THE BUZZ: FIRST IN PLAYBOOK: One of Silicon Valley’s heaviest hitters is wading into the fight over California’s AI regulations. Y Combinator — the venture capitalist firm that brought us Airbnb, Dropbox and DoorDash — today issued its opening salvo against a bill by state Sen. Scott Wiener that would require large AI models to undergo safety testing. Wiener, a San Fracisco Democrat whose district includes YC, says he’s proposing reasonable precautions for a powerful technology. But the tech leaders at Y Combinator disagree, and are joining a chorus of other companies and groups that say it will stifle California’s emerging marquee industry. “This bill, as it stands, could gravely harm California's ability to retain its AI talent and remain the location of choice for AI companies,” read the letter, which was signed by more than 140 AI startup founders. It’s the first time the startup incubator, led by prominent SF tech denizen Garry Tan, has publicly weighed in on the bill. They argue it could hurt the many fledgling companies Y Combinator supports — about half of which are now AI-related. While Wiener’s bill explicitly targets the biggest AI models, Y Combinator is leaning into the argument that it will hurt the little guys. “This grassroots letter, which bubbled up from our community of founders in less than 48 hours, represents the voice of 'Little Tech' in California,” Luther Lowe, Y Combinator’s head of public policy, said in a statement. Wiener’s Senate Bill 1047 has been a target of regulation-wary tech companies since its inception in February, but it managed to glide through its house of origin without major resistance. Now, it’s getting hit hard in the Assembly, where opponents have been ramping up the pressure to knock down a measure they say would stifle the homegrown industry. The bill would require developers of the biggest AI “frontier models” that cost $100 million or more to train, to conduct risk assessments of those systems, with the goal of preventing catastrophic harm. Wiener has long characterized the requirements as reasonable. Earlier this week he said the bill had a “light touch.” Many companies disagree. Online vitriol exploded after the bill passed the Senate last month. Industry group Chamber of Progress just launched an online petition against SB 1047 earlier this week. In its letter to Assembly Judiciary Committee Chair Ash Kalra and privacy chair Rebecca Bauer-Kahan, Y Combinator said the bill could “threaten the vibrancy of California's technology economy and undermine competition.” The startups raised concerns about the liability tech companies could face for misuse of their models, and say vague language could lead to an inadvertent crackdown on their industry. “California is at the center of this revolution. AI is powering our post-COVID recovery,” the letter says. They also argued that, because developers are required to certify their compliance with the safety standards every year under penalty of perjury, any misuse of their software could send them to jail — an argument that has been parroted across the internet. Wiener emphatically disputes that claim. "This is not a bill that's going to send anyone to prison," he said. "I think it's really unfortunate to convey to these startup founders that there's a risk they're going to go to prison. That's completely and utterly untrue." Proponents of the bill say public support is on their side. A large majority of likely voters, 77 percent, support SB 1047, according to a recent poll conducted by David Binder Research for the Center for AI Safety, the sponsor of Wiener’s bill. In an interview with Playbook, the San Francisco lawmaker was careful not to alienate powerful constituents, saying it was a dispute among friends. While he has great respect for Tan and Y Combinator, he said their position hinges on a number of inaccuracies. The bill only impacts the largest models, and should not affect small start-ups, Wiener said, as a key point of clarification. | 
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