OpenAI cuts back on side quests: is Jony Ive building a $6.5 billion pen? 🖊️ Plus New Balance overtakes Nike, and all the latest brand news

Issue #84

Weekly Exhale

What if it was a pen?

It’s a halcyon morning in San Francisco, late May 2025. Unbroken sky over the Financial District, the Transamerica Pyramid, the glass towers, the money.

At the corner where Little Italy meets Chinatown, the Sentinel Building catches first light. A Beaux-Arts flatiron, copper-green and defiant, its foundations laid before the 1906 earthquake, its exterior completed the year after.

Francis Ford Coppola bought it in 1973 for half a million dollars. His office is upstairs.

Cafe Zoetrope is on the ground floor.

Inside, Sam Altman and Jony Ive sit at a zinc bar running the length of the room. They’re drinking coffee from small cups and talking about the future of AI.

A few feet away, a crew directed by an Academy Award winner captured every second. The nine-minute film cost $3 million to make and SFPD had to shut all the roadways in the heart of North Beach. The credits thank “The Coppola Family.”

The wood panels of Cafe Zoetrope, a building born from seismic change, and an offer you can’t refuse — you couldn’t script a better setting for what happens next:

OpenAI is spending $6.5 billion to hire the man who designed the iPhone.

Jony Ive: “*I have a growing sense that everything I have learned over the last 30 years has led me to this moment.*”

Before the ink on the deal had even dried, the Wall Street Journal obtained a recording of an internal all-hands. Sam Altman told employees he expects to ship 100 million companions, faster than any company has ever shipped 100 million of anything.

But then Jony disappeared.

In the ten months since, Sam and Jony have appeared together exactly once. It was November at Emerson Collective’s 9th Annual Demo Day. The pair joined Laurene Powell Jobs on stage — widow of Steve Jobs, the man Jony once called his closest creative partner. No cameras this time.

Sam confirmed the first prototypes were “jaw-dropping”. Jony said he’d know when the design was right, “when you want to lick it or take a bite.”

After a $3 million film for a $6.5 billion hire, this wasn’t much of an update.

Earlier this year, leaks started trickling out, none of them telling the same story.

First, Vietnam. A contract manufacturer, Foxconn, tooling up for something. Or three somethings. One had codename: “Gumdrop.” It’s pen-shaped and works on any surface.

Then a second: “Sweetpea.” Something that looks like earbuds but isn’t quite earbuds, with a custom 2-nanometre chip.

Then rumours of a smart speaker.

Then, back to earbuds: a leaked Super Bowl ad. Alexander Skarsgård, the actor who played Succession’s chaotic tech billionaire, wearing metallic buds, tapping a tabletop device. Debunked as fake.

Then, more earbuds, Joe Gebbia — Airbnb’s co-founder, deep in Ive’s orbit — spotted in a San Francisco coffee shop, also drinking espresso, wearing shiny silver pills that bisect his ears. A clamshell disc on the counter. WIRED said the footage was real. OpenAI declined to comment.

Ten months in and we’re being led everywhere and nowhere.

If you’re feeling generous, this is Jony in Apple secrecy mode, maniacally focused on making something that’s insanely great. Leaks are irrelevant. The product will speak only when it’s ready. And when it does, it’ll speak for itself.

If you’re feeling less generous, this is classic Sam. None of the above.

Which leaves us to imagine. Wildly.

Late February, OpenAI closed a $110 billion funding round — the largest private raise in history — at an $840 billion valuation.

What everyone already knows: OpenAI needs roughly $280 billion in annual revenue to justify it, a figure no company founded after 2000 has come close to.

More simply, the numbers say OpenAI needs…a…miracle.

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My mum and dad were over before I made it to school. Soon my mum was dating again. And then a man came to stay.

He continued to stay. Despite me. And despite many other things.

He kept staying.

Some more time passed.

And then, not all at once, and without anyone quite knowing when, it felt like he’d be there forever.

I didn’t need to call him Dad. It was cooler than that. I just used his first name, Graham.

And I grew to love him very much.

When he passed away suddenly, I was 21 and Mum never recovered.

Graham ran a pub for as long as anyone could remember. The sticky-carpet kind, with regulars called Mick the Boat and Big Brian and another everyone knew as Suitcase but nobody could explain why. Men who laid bricks and drove vans all week, then sat on the same stool every Friday and drank away all their wages chewing each other’s ears off about nothing.

Somehow that was the glue.

So when the day came, the whole community showed up.

My three best friends who’d known him longest laid flowers. Tucked into the arrangement was a small card. They were obviously lost for words, because they only wrote one:

“Cheers!”

Blue ink, fountain pen. I knew immediately which of the three did the writing. The slight forward slant, the letters leaning as if holding each other up.

That card is still in a box.

And when it comes out, I can feel Graham’s big calloused palms holding my face, from the other side. On my shoulder, the hands of close friends still safely on this one.

So in whatever drunk, dazzling, slightly absurd chapter of history this turns out to be, I dream about the pen.

And if we’re imagining wildly, Jony has been living with codename Gumdrop in his hand for some time.

Jony’s father was a silversmith. A lecturer at Middlesex Polytechnic. Every Christmas, he gave Jony one day in his college workshop, just the two of them, no one else around, to make anything he wanted. His father’s only constraint: draw it by hand first.

Jony’s first commercial product was also a pen — the Zebra TX2, designed as a student, a white ballpoint with a fiddle mechanism on top that served no purpose other than to make you want to pick it up and play with it. It sold in the millions.

Today, Jony owns a Marc Newson pen for Hermès and a vintage Montegrappa. He sketches in brown ink, like Leonardo da Vinci.

Had Steve Jobs not wandered into a calligraphy class at Reed College, Apple wouldn’t exist. Jobs described the letterforms as “beautiful in a way that science can’t capture.”

Jony lost him in 2011. He remembers a hazy October sky, tight shoes, sitting in Steve’s garden for a long time.

And, there’s a darker motivation.

Jony himself has said that the iPhone — his iPhone — ended up enabling the thing he most despises: technology that separates people from their lives, and from each other.

So when he talks about everything leading up to this moment, maybe it isn’t a miracle he’s planning.

Maybe it’s amends.

A pen, then. Pen first. AI after.

A weighted body, sapphire nib. Real ink on real paper. You don’t learn anything new, you just write or scribble the way you always have — in a Moleskine, on the back of a napkin, on whatever’s in front of you.

Everything the pen captures is expanded by a companion intelligence layer, specific to you. Your handwriting is as unique as your fingerprint. Your doodles a window into your soul. Post-it notes become white papers. Numbers, business models. Circles and squares, fully rendered plans. Over time, it becomes something no app or chatbot has ever been — a way to micro-dose, a way to expand whatever’s already in your head. Neuroscience confirms it, a pen in your hand triggers the brain differently than anything else.

No product launch promo. No dry ice.

Jony gives five hundred pens to architects, surgeons, novelists and philosophers. He excludes anyone with a ring light or a masterclass to sell. Each pen arrives in a matte black case with a handwritten note in Ive’s own spidery italic. Just three words:

Please use this.

First sighting is in the pocket of a Patagonia vest at Davos. Then in the hands of a rapper photographed for the Paris Review. A blurred photo on X — “Anyone know what this is?” — triggers a political argument within seven comments.

The Verge puts out an extended podcast explaining absolutely nothing, because OpenAI won’t confirm or deny.

A shirtless man on TikTok uses it to write “I think before I type” on a rock in a forest. Gets more views than the Super Bowl.

A brand strategist on LinkedIn coins the phrase “analogue abundance” and 43,000 other brand strategists repost it.

Saturday Night Live does a sketch. He holds up the pen and whispers about “celebrating what makes us irreducibly human.” Tina Fey asks, “But what does it actually do?” Jony pauses, smiles. “It writes.” Fey stares. “For twelve hundred dollars?” Jony leans in: “*...beautifully.*”

The pen sells out the following Tuesday.

The good version? Like AirPods and Apple Watch before it, Jony’s design supercharges the known market for luxury and smart pens. Seven to ten million units at maturity, $15–20 billion in hardware sales, securing another few billion in highest tier paid subscriptions.

Roughly a tenth of what OpenAI needs.

Which is...nowhere near enough.

It’s not the pen’s fault. You’d need roughly every adult in Japan buying one. Or every adult in the UK buying three. Neither seems imminent.

Nor the earbuds. Nor a clamshell on your desk. Even if Jony expands every known market he enters, the volumes just don’t add up.

Launched together as a family, they might just about lock people into an OpenAI companion ecosystem. Decent maybe, miraculous unlikely.

And this week, OpenAI’s head of applications told staff to stop chasing “side quests” — Sora, the browser, hardware, all of it under review. Sam insists the device survives. But when your own company is calling code red, does Jony start to look like a very expensive side quest?

As for Jony: no matter how lickable or edible his designs are, Sam will require they’re built to harvest the most intimate human data possible.

That’s a long way from making amends. Maybe for $6.5 billion, Jony can get over it.

For sure, the lightning that struck at Cupertino between Jony and Steve was unique. Two kindred spirits, at just the right time in their lives, at just the right vector in the universe.

What we’re watching on the corner of Little Italy and Chinatown is two men, sipping from small cups, whose dreams this time may not be the same.

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Back in my home office, I don’t keep books. I keep inscriptions. The messages people write inside the cover, by hand, before they give them to you. The books themselves barely matter.

The writing is everything.

A Bic biro from the back of the kitchen drawer will do. The one with no cap, fluff stuck to the end, that you have to lick three times and scratch furiously in the corner of the page to get working.

Graham always said: “Remember. Everything in life is on loan to you.”

He was right. If you’ve known people for a very long time, you’ll have lost some along the way. Soon you’ll lose more. Or maybe they lose you.

But when you put pen to paper, something stays long after the loan is up.

Tonight, for no particular reason, I’m feeling it. So I take out the card. Blue ink, that familiar forward lean, the letters pressed together like last orders at the bar.

“Cheers!”

And he walks into the room.

Let’s rise together with every issue. ♡

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Market Moves

Iran War is causing dramatic effect on UK economy | BBC

Bank of England warns of inflation risks | Financial Times

Stocks tumble as oil breaches $110 per barrel | The Wall Street Journal

Brand Beat

Nielsen data shows traditional TV briefly back on top | The Wall Street Journal

What is Joe Gebbia’s mysterious metallic device? | Wired

What McDonald’s ‘Burgergate’ pile-on means for brands | Fast Company

Colgate targets stressed millennials with resilience campaign | Marketing Dive

Inside Apple’s plan for a low-cost MacBook Neo | Forbes

Influencers paid $3,000 to per reel to rediscover Facebook | BBC

Netflix disrupts traditional TV upfront deal model | Digiday

Oscars viewership drops 9%, first decline since 2021 | The New York Times

Can buying Depop make eBay cool again? | Modern Retail

Taco Bell emerges as the Apple of fast food | Fast Company

Sprite reclaims NBA sponsorship from PepsiCo’s Starry | The Wall Street Journal

Home Depot drops its latest World Cup marketing campaign | Brand Innovators

Paramount’s $110 billion bet on Warner Bros | The Verge

Lloyds pushes to be UK’s biggest fintech | Sifted

DoorDash CMO Kofi Amoo-Gottfried to step down | Adweek

Sweetgreen slips further behind peersm| Bloomberg

BrewDog’s rise and fall: brand community lessons for marketers | Marketing Week

Kraft Heinz confronts structural reckoning in legacy CPG | GlobalData

New Balance’s ‘dad shoes’ overtake Nike amid 19% sales surge | CNBC

Saying goodbye to Mr. Clean, the iconic cleaning mascot | Vice

The CMO taking Coach to $10 billion in sales | The Wall Street Journal

Reddit’s plan to be the antidote to AI shopping | Vogue

System 1’s Ad of the Week is Philadelphia Cheese | System1

Starting Up

Startups as family-run businesses | TechCrunch

David Protein responds to controversies | Feed Me

Pizza cupcakes: the best of Expo West 2026 | New York Times

A conversation with Garry Tan, CEO, Y Combinator | SXSW

Tech Tidbits

Silicon Valley musters behind Anthropic | The New York Times

Microsoft weighs legal action over Amazon-OpenAI $50 billion cloud deal | Slashdot

OpenAI to cut back on “side quests” | The Wall Street Journal

Meta winds down VR | Wired

OpenClaw is the new ChatGPT says Jensen Huang | CNBC

Venture Vibes

How Robinhood’s rose to a $68B valuation | The Week In Startups

AI grants you superpowers: what’s your next move? | a16z

Just three companies dominated $189B in venture capital last month | TechCrunch

Sequoia and OpenAI back European AI accelerator to rival YC | Sifted

Design Driven

The Brand Age: Avoid brand building if you can | Paul Graham

Clarks shoes shaped pop culture from Britpop to Breaking Bad | It’s Nice That

NPR turns its logo into questions to defend curiosity | Adweek

Why typography may be the last thing AI can’t fake | Creative Boom

Happiness

What makes some people instantly likable to others | Big Think

Why bringing your whole self to work traps women | Fast Company

Consciousness is a mystery | The Grey Area

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