The Morning Download: AI Pioneers Vibe Code CRM

Good morning. The WSJ Leadership Institute’s Isabelle Bousquette spoke to companies about how they are using AI to create their own custom software tools.  Her reporting shows that the frontier of AI adoption among businesses has gone further than many people would have expected.

Don’t miss her story about companies vibe coding their own CRMs. “Predictions that AI tools could help displace established business software are quietly coming true in some segments of the market,” she writes. Highlights:

A number of small and midsize companies say they are vibe coding their own customer relationship management software in an effort to get more customized systems at a better price. CRMs are a critical business system for tracking, analyzing and taking action on sales, marketing and customer data.

• In January, Dave Clark, the former CEO of Amazon’s consumer operations and current CEO of supply chain startup Auger, went viral with a post about how he vibe coded a new CRM over the course of a weekend. “We tried configuring an off-the-shelf tool for our cycle. Too many fields we don’t need, missing the ones we do…So I just built what we needed. Took a night and a morning,” he wrote.
• Bill Schonbrun, chief operating officer of water treatment company CarboNet, opted to build his own custom CRM for the 65-person company with the help of AI.

CarboNet worked with startup OverAI on the project.

OverAI, a startup with five full time employees and $6.35 million in venture funding, offers a conversational “AI Architect,” that helps companies build their CRM, or any other given system in natural language, while also pulling in prebuilt components, like permissioning systems and security alerts, said co-founder and Chief Executive Mollie Breen.

CarboNet’s Schonbrun said the costs of a project such as his are about $15,000 to $20,000 to build and $5,000 annually to maintain.
“You can be incredibly specific with exactly what you want it to do. And that makes the user’s lives way easier,” he said.

Nonetheless, market panic about the future of software companies is overblown, said Stefan Slowinski, global head of software research at investment bank BNP Paribas. Slowinski said some of the investor concern is less about customers walking away from established vendors in favor of vibe-coded alternatives and more that an explosion of new, AI-powered vendors could give customers negotiating leverage and put pricing pressure on the established players.

Has your company vibe coded custom software tools or applications? Let us know how that’s going.

Anthropic CEO calls OpenAI's Pentagon deal "safety theater." Anthropic investors are quietly reaching out to the Trump administration to defuse the company's standoff with the Pentagon over an AI safeguard dispute, Reuters reports. Last week the Pentagon labeled Anthropic a supply-chain risk.

The FT reports that CEO Dario Amodei has also been involved in last-ditch talks with Emil Michael, under-secretary of defense for research and engineering.

Possibly complicating the diplomacy is a staff memo Amodei sent Friday, since published by The Information, in which he dismissed OpenAI's freshly-minted Pentagon deal, arranged while Anthropic was frozen out, as "safety theater."

The 1,600-word missive won't be confused with anything issued by Amazon's Jeff Bezos and Berkshire Hathaway's Warren Buffett, pioneers of the Golden Age of CEO notes.

But it is something else.

After torching OpenAI, Amodei went further, suggesting the administration had soured on Anthropic because the company hadn't donated to Trump and, in his words, hadn't given the president "dictator-style praise."

South Korea says conflict threatens chip industry. Prolonged conflict in the Middle East could deal a serious blow to South Korea's semiconductor industry, a senior South Korean official has warned. Escalating hostilities threaten to choke off shipments of critical materials used in chip production while driving up energy costs for manufacturers.  South Korea, home to Samsung Electronics and SK Hynix, produces nearly three-quarters of the world's DRAM memory chips.

AI to the rescue? The WSJ reports that some newspapers are looking to AI to claw back some of the coverage (and relevance) the industry has lost over decades of advertising declines, consolidation and advances in digital technology. At outlets like the Philadelphia Inquirer, reporters are deploying AI to monitor community meetings, police scanners, and other classic beats that old-school shoe-leather journalism once owned.

Reporters are also using AI to scan meeting transcripts and compile requests for access to government data and even write first drafts.

“We publish news, not poetry. Who died? What restaurant closed? What was the Browns score?” Cleveland Plain Dealer Editor Chris Quinn wrote in one column detailing the paper’s work with AI tools.  “The quicker we get to the point, the happier our busy readers are.”

Big Tech goes to D.C., pledges to pay own power bills. Tech executives gathered around President Trump at the White House on Wednesday to announce a "ratepayer protection pledge," committing to independently source all electricity for their data centers rather than draw from local power grids. The voluntary pledge comes as fears over rising electricity bills and environmental damage has fueled grassroots resistance to the data centers that underpin modern AI. 

The backlash is already reshaping politics: The New York Times reports that Democrats flipped two seats on Georgia’s utility commission last year by making the cost of electricity a centerpiece. Electricity prices are up 6.3% this year, and utilities have requested an additional $31 billion in rate hikes, nearly double last year's ask, Barron's reports.

Apple flexes its supply chain muscle. Apple is positioning itself to capture more of the budget phone and laptop market by holding prices steady on its lower-end products — even as memory and storage costs surge industrywide. By leaning on its formidable supply chain, the company could pull ahead of rivals scrambling to source components, analysts tell the Journal. "Given unprecedented shortages in memory, Apple has a unique opportunity to gain share over lower-end Android smartphone makers who cannot secure enough memory," Bernstein analyst Mark Newman wrote in a client note this week.

OpenAI veteran bets on factory AI. OpenAI's former chief research officer is raising $70 million for a new startup aimed at automating manufacturing through AI, WSJ reports. The company, called Arda, is co-founded by Bob McGrew and is targeting a $700 million valuation. Founders Fund and Accel are co-leading the round, with Khosla Ventures and XYZ Venture Capital also participating.

McGrew left OpenAI in 2024 after eight years at the company, departing during a wave of high-profile exits that included chief technology officer Mira Murati. And for the Tolkien trackers: Arda joins Palantir and Anduril in pulling its name from the world of Middle-earth.

Senators grill Intel over China ties. A bipartisan group of six U.S. senators is pressing Intel for answers about its ties to ACM Research, a semiconductor equipment maker with significant links to China. The lawmakers said this was especially concerning since Intel is now partly owned by taxpayers, after the Trump administration acquired 10 percent of the company last year. 

Oil prices pushed higher early Thursday, extending an advance that has rippled through financial markets and threatens to set off convulsions in the world economy. (WSJ)

Russia is one of the biggest winners in the early days of the largest U.S. military confrontation in decades, as Iranian missiles deplete stocks of Patriot interceptors that Ukraine needs for its defense. (WSJ)

China signaled that the world’s second-largest economy is entering an era of slower expansion, setting a target for gross domestic product growth of between 4.5% and 5% this year. (WSJ)

Morgan Stanley is laying off around 3% of its workforce or about 2,500 people, according to people familiar with the matter. (WSJ)

The WSJ CIO Journal Team is Steven Rosenbush, Isabelle Bousquette and Belle Lin.

The editor, Tom Loftus, can be reached at thomas.loftus@wsj.com.