The CTO Show Brief: Issue 152

Author

Mehmet Gonullu
January 04, 2026

Welcome to Issue 152 of The CTO Show Brief.

The year closed with three structural moves: Nvidia absorbed its most credible inference challenger, secondary markets became the default liquidity mechanism, and a major outage rewrote the rules of cloud architecture. Meanwhile, sovereign capital continued its pivot from passive allocation to active ecosystem-building.

These are not 2025 stories. They are the operating conditions of 2026.

Nvidia Closes the Inference Gap

Nvidia's ~$20B licensing deal with Groq—plus the acqui-hire of founder Jonathan Ross—neutralizes the most viable architectural threat to GPU dominance in inference. Groq's deterministic LPU design solved the latency problem that plagues real-time agents. Rather than buy the company outright and trigger antitrust review, Nvidia licensed the IP and absorbed the talent. The strategic read: hardware challengers no longer exit via disruption. They exit via licensing. The 'Nvidia killer' thesis is dead; the new play is becoming a Nvidia supplier.

Secondaries Are Now the Primary Exit

Global secondary transaction volume hit $103B in H1 2025, with full-year projections exceeding $160B—a 51% year-over-year surge. This is not a temporary workaround for closed IPO windows; it is structural. LPs facing the denominator effect are demanding distributions, and GPs are manufacturing liquidity through continuation vehicles. The bid-ask spread has finally compressed as sellers accept that 2021 valuations are not returning. For founders, this means planning for rolling liquidity events—employee tenders, early-investor buyouts—rather than waiting for a single binary exit.

Agentic AI Hits the Verification Wall

Enterprise agent deployments are showing a 40% failure rate. The root cause: autonomy amplifies dysfunction. Companies are layering agents over undocumented, broken processes and generating errors at machine speed. The response is a new architectural primitive—auto-judging—where models verify their own outputs before execution. This adds compute cost and latency, but it is becoming table stakes for enterprise sales. Founders building agents without a verification layer are building unsellable products.

The Cloud Fragility Reckoning

The Christmas Outage—which cascaded through Epic, Fortnite, and major online services—was not a server failure. It was a demonstration that high-availability zones are an illusion when dependencies are shared. A failure in a federated identity provider collapsed services across redundant infrastructure. The new CTO mandate for 2026: graceful degradation over uptime promises. Systems must function in degraded states rather than fail completely. The mantra has shifted from 'the cloud never fails' to 'how do we survive when it does.'

The Gulf Becomes a Tech Destination, Not Just a Capital Source

Saudi VC deployment hit $860M in H1 2025—up 116% year-over-year—with investment spreading across stages rather than concentrating in mega-projects. More consequential: SDAIA's new Secondary Use of Data regulation creates a legal framework for AI training data that is explicitly permissive, positioning the Kingdom as a 'data safe harbor' while the West remains tangled in regulatory friction. The UAE's Microsoft partnership ($15.2B) and 97% AI adoption rate reinforce the thesis: the Gulf is no longer just writing checks. It is building sovereign AI infrastructure and competing for the companies, not just the allocation.

The question for 2026: In a world where liquidity is engineered, inference is consolidated, and sovereignty is strategic, who builds the systems that survive failure—and who builds the systems that cause it?

🎙️Episodes Recap:

In this episode, Mehmet Gonullu sits down with Nat Rajesh Natarajan , Chief Operating Officer and Chief Product Officer at Globalization Partners, to explore what it really takes to deploy AI in highly regulated environments. From labor laws and compliance across dozens of countries to human-in-the-loop AI systems, Nat shares how Globalization Partners built explainable, trustworthy AI that enterprises can actually rely on. This is a grounded, operator-level conversation on moving beyond AI hype toward real productivity and trust.

In this episode, Mehmet sits down with Michael Ferranti , a seasoned tech executive and product leader at Unleash, to explore why DevOps alone can no longer meet the reliability, speed, and risk demands of modern software systems. From real-world outages at Google and Cloudflare to the rise of AI-driven delivery, this conversation introduces FeatureOps as the missing control plane that allows teams to move faster without breaking production.

 📖 From Nowhere to Next

Every week I share startup lessons and stories through The CTO Show Brief. But if you want to go deeper, my book From Nowhere to Next brings together the experiences and insights that shaped my own journey.

Thanks for reading — and for being part of this growing, global-minded network.

— Mehmet