It’s Raining Money in California

The AI boom is flooding California startups with unprecedented amounts of money.

So far this year, California-based companies have raised over $366B in venture capital, more than three times the fundraising total of the other 49 states combined. It’s also twice California’s previous record, which was set in 2025.

OpenAI and Anthropic are leading the charge, having raised $122B and $95B this year, respectively. OpenAI’s haul was the largest funding round in Silicon Valley history. OpenAI and Anthropic are currently the most valuable private companies in America, each valued above $800B.

But it’s not just the AI giants raising VC money. According to PitchBook data, 4,000 California-based startups have raised capital in 2026. In recent reports covering the Bay Area and LA County, we’ve seen this boom ourselves. It’s hard to find a billboard in the Bay Area that’s not an AI company, and VC leaders we talked to – including one that invested in OpenAI when it was still a nonprofit – said there’s a strong sense of “FOMO” for all investors in the Valley. In LA County, we visited hard tech companies that are raising massive rounds by merging AI and robotics.

The fundraising haul is a boon for both the state’s finances and the Bay Area housing market. It’s just a matter of time until we get our first $5,000-a-month sleeping pod!

–Max Towey

A boon for California’s finances is turning out to be a bust for Ohio’s GOP…

As midterms near, AI-driven data centers are becoming a hot political issue in the state and across the country. A June poll from Reuters/Ipsos found that, across parties, only a third of Americans said the pace of current data centers was mainly a good thing, 14% said they’d be comfortable with a data center built nearby, and 77% fear data centers will raise electricity costs.

Perhaps nowhere captures this concern better than Ohio’s Senate race, where former Senator Sherrod Brown (D) is neck-and-neck with Republican incumbent Senator Jon Husted, who filled Vice President JD Vance’s seat in 2025. Tech companies are planning to invest upwards of $40B by 2030 into data centers in the state, a move that might be the state Republicans’ downfall.

The National Republican Senatorial Committee – the GOP’s Senate campaign wing – sent a private memo to major AI companies warning that public anger at data centers is jeopardizing Husted’s Senate seat in Ohio, according to Axios, which obtained the document.

The memo said Democrats have built their campaign against Husted largely around the data center issue, and that their strategy is succeeding (polls now show Brown ahead). The memo says: “If [Husted] loses and data centers get the blame, politicians across the country will take notice — and they will not go near the next one…This has become a sleeper issue for the entire election cycle.”

Husted supported tax breaks for data center developers when he was lieutenant governor from 2019 to 2025 but has since pointed to his effort to make data center developers carry a higher share of utility costs. Brown has spent millions on summer ads branding Husted “the face of data centers in Ohio.”

The GOP memo puts the burden on AI companies to explain to Ohioans “who benefits, who pays, and why a community should want [a data center].” The party warned that if perceptions don’t change soon, the backlash could domino across the country.

Supporters argue that AI is a continuing source of American economic growth and is needed to counter China. Goldman Sachs estimates that AI investment will reach around $600B this year, roughly 2% of GDP. The Financial Times found that the six largest cloud companies – Alphabet, Microsoft, Amazon, Oracle, Meta, and Nvidia – already have a total of $1.5T in purchase commitments, largely tied to AI, plus another $1.5T in long-term leases on buildings and land. That $3T in bills will come due whether or not the AI boom takes off.

For the Trump Administration, the national security question has played a large role. President Trump signed an executive order in June directing agencies to use AI to strengthen federal systems against cyberattacks, and the Pentagon’s fiscal 2027 budget request includes $29.5B for an “AI Arsenal initiative” that would build a portfolio of hardened data centers and stock them with a government-owned fleet of AI supercomputers.

So the Trump Administration and the private sector are preparing for the AI boom to continue, but if Senate Republicans are right, the GOP will be DOA come November.

–Max Hudgins

Tensions are flaring up in East Asia: North Korea fired about 10 short-range ballistic missiles into the sea on Thursday, according to South Korea’s military.

The launches came from the Pyongyang area around 5 PM local time and flew east into the Sea of Japan. Japan’s prime minister’s office said it detected a suspected launch that had already come down, while South Korea’s presidential national security council held an emergency meeting and ordered the military to resume full readiness, calling on Pyongyang to stop the launches.

Earlier this week, South Korean President Lee Jae Myung used a Liberation Day ceremony – celebrating South Korea’s liberation from Japanese rule – to propose talks on formally ending the Korean War. The two sides remain technically at war after signing an armistice in 1953 but never a peace treaty.

The salvo also comes after days of US outreach to the DPRK. President Trump ordered the Pentagon to scale back Ulchi Freedom Shield, one of two major annual US-South Korean military exercises, hours before it began on Monday. Trump called the drills, which were shortened from 11 days to five, inappropriate and hostile to a North Korea that had been “unthreatening and respectful.” He pointed to his relationship with Kim Jong Un and to Seoul’s refusal to back the US in the conflict with Iran.

Trump said on Wednesday that he expects to meet Kim Jong Un this year. Though Kim Jong Un’s sister, Kim Yo Jong, denied recent contact between her brother and Trump, and dismissed the shortened military drill, saying it is no less provocative.

In response to Trump, Kim Yo Jong said his and Kim Jong Un’s relationship stays “excellent,” but one can’t help thinking the missile tests are a firm “no” from the DPRK to both South Korea and Trump’s overtures.

–Max Hudgins

The Roca Mag

We got great feedback this week on Issue 4 of the Roca Mag. There were a lot of interesting comments on Max Towey’s article about the South’s cultural takeover, so we’re sharing some of those below.

Greg from Atlanta said:

This is a fantastic analysis of what many of us have been “feeling” for years... and supported by a Roca hallmark: facts that speak for themselves.

But it’s not as if the South is coming to the rest of America, it’s the reverse. The rest of America is coming to the South and, therefore, expanding the South’s reach to the rest of America through networks of transplants’ (as they are locally known) friends, families, and business relationships.

Whether it be retirees moving down (not many folks retire and head north!), favorable business and tax environments, increasingly strong education and entertainment, or just a feeling of living life beyond the concrete jungles of many northern and west coast cities, there is without doubt a cultural attraction to many.

It’s NOT “the South shall rise again,” it’s that the New South welcomes all :)

Keep up the great work

Ted said:

I’m curious of what you mean by “the south is resisting the monoculture?” The premise of the article, while often on point, is that the south is promoting a new americana or monoculture that is participated in largely through digital adoption. The southern driven tropes of football, beer, country, rushtok are all examples of template-driven media (marvel-included, also southern as you note) that are nothing if not an often corporate and profit driven monoculture? Liking all of these things is fine and many of them I also enjoy, but I find many of these things are liked because that IS the culture, not because of critical decisions. Isn’t that what a monoculture is? Sorry if I find that dystopian rather than inspiring.

And Atmos wrote:

I’ve definitely noticed this, after living in Charleston, SC for two years I really began to see the culture and I was definitely blown away by all the other states I visited. Berkeley County is one of the fastest growing in the nation, not only are they taking over music, streaming as well. Caseoh became one of the biggest streamers in these past years too. It’s cool to be able to put some statistics to the feeling that the country as a whole is heading more south.

If you missed Towey’s piece, read it here!

Max Hudgins’ article on the Gen Z dating crisis also garnered quite a lot of comments — below are a handful of those.

Carrie wrote:

Many women (especially older Gen Z) are looking for a companion and partner, not necessarily a provider. They want someone with emotional IQ and no where is that being talked about in the “manosphere”. I’ve only seen it discussed in psychology circles. Not only are women more financially independent but they are also going to therapy more than previous generations. The same issue is happening in Gen X. Many women in that age group are finding themselves more financially independent and wanting a partner but the men are still living as if women just need a provider. There a large discrepancy between what women are looking for and what men think their role is.

Anonymous wrote:

More love for Max H here. His piece on men and dating is probably my favorite Roca piece I’ve ever read and as a young woman, it’s the story I’ve been waiting for for years at this point. THANK YOU!!! He did a fantastic job explaining the good, the bad, and the truth of the situation.

And Becky said:

As a 60 yr old woman who plays D&D with some 20 something college educated young men, I see this mindset in them. They are intelligent, kind, good people: great husband material, but they don’t ask women out or form relationships because they think they have nothing to offer, or fear making a mis-step in the wake of the metoo era. They don’t feel being their good qualities are enough to attract or keep a woman.

Check out Hudgins’ piece here!

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