Michael Dodd

Just a venture guy in Austin, Texas

[Thierry from arvy 🇨🇭 @ThierryBorgeat]

Citadel Securities just put institutional weight behind what the AI bulls won't say out loud.

In a new macro note titled "Tokenomics," Citadel makes the argument plainly: even the most powerful technology on earth still has to pass through the boring discipline of cost curves, capacity limits, and marginal returns.

The evidence is piling up:
– Amazon removed its token usage leaderboard
– Microsoft cancelled Claude Code subscriptions
– Multiple companies reporting unexpectedly massive token bills

Their conclusion is the part that matters.

Adoption is no longer about what AI can do in principle. It's becoming about the price and scarcity of the inputs needed to run it at scale. Compute. Power. Cooling. Memory bandwidth. Inference budgets. All real, all binding constraints.

And here's the kicker from the chart.

The Silicon Data LLM Token Expenditure Index, a benchmark for how much the market is actually spending on AI tokens, has started rolling over. Citadel reads it as a shift toward cheaper models. Companies substituting away from expensive frontier AI toward "good enough" alternatives.

That's economics 101 doing what it always does. When the price of something rises, people use less of it, or find a cheaper version.

Citadel sees a bifurcation forming. Frontier AI concentrated among a few firms with the balance sheets to absorb the cost. Everyone else quietly downgrading to simpler, cheaper models.

This is the part of every technology revolution the early narrative ignores.

The technology being real was never the question.

The question was always whether the economics could carry the valuations.

When one of the most sophisticated trading firms on earth starts writing about AI in the language of cost curves and rationing instead of limitless demand, the conversation has quietly changed.

The hype was about what AI could do.

The reckoning is about what it costs.

[Michael Dodd @MichaelJDoddJr]

@AskeBay I need help. I purchased a set of new golf irons on ebay. The seller looked legit. They charged my CC & gave me a UPS shipping ID. The ID shows it's coming from China. When I try to contact seller it says "no longer registered user" Help!

[Michael Dodd @MichaelJDoddJr]

@meelonmuskusa 56

[Michael Dodd @MichaelJDoddJr]

@AUStinAirport Hmm, SLC built a new 100+ gate airport in under 5 years, and overcrowded AUS will only complete 3 new gates by 2026 and concourse B by….maybe 2060? We should and need to do a lot better!!!

[Michael Dodd @MichaelJDoddJr]

@jimcramer Come on Cramer - I’m a fan, but that Pelosi interview was a joke...all softballs. You didn’t even ask her about indemnification for small businesses which you need for your bar and you talked to McConnell about...jeez. U know plaintiff lobby owns Ds! - Dissapointed fan :-(

[Michael Dodd @MichaelJDoddJr]

Numero Seis for Silverton! Our march continues to help great entrepreneurs.

[Crunchbase News @crunchbasenews]

Now on @crunchbasenews: #Austin's @silvertonvc closes on $144M across two funds. The raise marks the largest flagship venture capital fund raised by the firm since its inception in 2006, via @bayareawriter

https://t.co/4ZVre9qJzb

[Michael Dodd @MichaelJDoddJr]

Great piece on a revolutionary brand developed by two entrepreneurs at the top of their game https://t.co/FmA1NjgXBv

[Michael Dodd @MichaelJDoddJr]

Never, ever, ever fly this airline! They frequently cancel flights with no warning or reason. #Silverairways Silver Airways | Official Website| Flights to Florida, Bahamas & More
https://t.co/c8AMlqHUGu

[Michael Dodd @MichaelJDoddJr]

More Apple in Austin! https://t.co/GADaBQVsrT

[Michael Dodd @MichaelJDoddJr]

What an honor, marrying my younger brother Andrew Dodd and Amy Ecker last weekend here in Austin! Congrats you two, can't wait for the next chapters. Amy, welcome to the family!

[Michael Dodd @MichaelJDoddJr]

A BIG congrats to Rod and the amazing team at Spredfast. This is a fantastic outcome...and proud to have been a small part of it. https://t.co/K9wUTW4AOY

[Michael Dodd @MichaelJDoddJr]

https://t.co/u7cCOo2WWq

[Michael Dodd @MichaelJDoddJr]

@SouthwestAir Hello - how can i tell in my SW account whether I have credit in the form of dollars from a canceled flight? thx

[Michael Dodd @MichaelJDoddJr]

@teehugs @FOXTV couldn't agree more.

[Michael Dodd @MichaelJDoddJr]

Great afternoon of… https://t.co/pOBcyOBmtn

[Michael Dodd @MichaelJDoddJr]

Great piece by the CEO of Tracking FIrst - Silverton's latest investment!
The Enterprise Marketing Disconnect that Nobody Wants to Talk About https://t.co/t5hvUxlEa1 via @RWW

[Michael Dodd @MichaelJDoddJr]

Couldn't be more excited to be back working again with Verl Allen - former partner-in-crime at https://t.co/H1tk1cvg1B and Omniture...back in the day! Congrats co-founders Craig Scribnerer and John Boyd, this is going to be a fun one.
https://t.co/UjStQMTvED

[Michael Dodd @MichaelJDoddJr]

This way to the exit: Why Austin VC firm Silverton seems to have a midas touch - Austin Business Journal https://t.co/xMihka8o1I

[Michael Dodd @MichaelJDoddJr]

Why Austin VC firm Silverton Partners seems to have a midas touch https://t.co/xMihkapYTg via @MyABJ

[Michael Dodd @MichaelJDoddJr]

Dog at the office day!