A White House memo says David Sacks and Craft Ventures are divesting holdings in AI companies and hyperscalers like xAI and Meta
THE WHITE HOUSE WASHINGTON COUNSEL TO THE PRESIDENT TO: DAVID O. SACKS SPECIAL ADVISOR … Bluesky: @thinkyparts : I think it's tax free for him to sell because he's in the administration right? [embedded post] X: Dan Primack / @danprimack : 2/ When Sacks took the crypto and AI czar role, I wrote that he'd need to be transparent about his financial conflicts, and likely divest some of them, in order to have legitimacy. He seems to have done that. Dan Primack / @danprimack : 3/ Also worth noting that this new memo was released today by the WH, but appears to be months old. Dan Primack / @danprimack : NEW: @DavidSacks and his VC firm are divesting stakes in AI foundational model companies and hyperscalers, including xAI and Meta, per a new White House memo. He's retaining dozens stakes in dozens of SaaS and hardware startups, some of which may use AI. https://www.axios.com/...
Context & Ripple Effects
Sacks’ White House role was initially described as constrained in part because he would not divest Craft Ventures, making financial-conflict management central to the appointment from the outset. His earlier sale of more than $200M in digital-asset-related investments showed the administration using divestment to address that issue in an adjacent policy portfolio.
The new memo extends that separation to AI model providers and hyperscalers, while leaving stakes in many SaaS and hardware startups intact. It matters because the dividing line is being drawn around companies most directly exposed to federal AI policy rather than technology investing as a whole.
First-order effects
- Sacks and Craft Ventures must shed the identified AI-company and hyperscaler holdings, including xAI and Meta, reducing their direct exposure to policy-sensitive firms while he serves in government.
- Sacks retains investments in dozens of SaaS and hardware startups, so the memo narrows rather than eliminates his venture-industry financial ties.
Second-order effects
- The divestments give the White House a clearer basis to defend Sacks’ participation in AI policy, after the earlier concern that his adviser role would be limited because Craft was not being divested when the role’s conflict constraints were first reported.
- Other officials and outside advisers with concentrated AI holdings may face greater pressure to disclose, recuse, or divest when their portfolios overlap with the companies affected by their policy work.
Third-order effects
- If applied consistently, this points toward a more formal conflict-management framework for technology advisers: ownership in foundational-model and infrastructure companies becomes harder to reconcile with direct AI policymaking than broader startup exposure.
- The remaining startup stakes show the practical limit of that framework: government can separate officials from the most consequential platforms without fully severing Silicon Valley investment networks, leaving recurring scrutiny over where the boundary sits.
The trend: AI policymaking is increasingly forcing governments to define which private technology holdings are compatible with public-sector influence over the sector.