Latent Space and Unsupervised Learning recap AIE Europe and agent lab thesis

Latent Space and Unsupervised Learning have released their second annual crossover episode, recorded just after AIE Europe and before the Cursor-xAI deal. The conversation covers a wide range of topics including the "agent lab" playbook — starting with frontier models, specializing for a domain, then training proprietary models once data and workload justify it — and why domain-specific model training is real rather than just marketing. The episode also explores the AI coding wars, the vertical vs. horizontal startup debate, why memory and personalization may become the next major wedge, and how AI valuations have broken traditional startup intuitions about scale and durability. Jacob Effron hosts alongside swyx, who shares his view from the center of the AI engineering world on topics ranging from context engineering and evals to open models and non-NVIDIA hardware.