• Mall boutique Claire's filed for its second bankruptcy, with plans to shut 700 US locations as it faces a possible liquidation.
• The brand, which started as a wig shop in the 1960s, became a rite of passage for many tweens looking to pierce their ears.
• After a 2018 bankruptcy filing, Claire's briefly surged in 2022 with IPO plans and a profitable year before things went south.

It's the end of an ear-a. Again.

Claire's, the jewelry and accessory store that dots malls across America, filed for Chapter 11 bankruptcy for the second time in seven years on August 6, citing the "continued trend away from brick and mortar" and higher interest rates.

The '90s mall icon was something of a rite of passage for many tweens, some of whom got their first ear piercing at one of Claire's purple, hairbow-filled locations.

Now, hammered by tariff costs and fighting for its life, Claire's plans to close around 700 US locations and is warning that it could liquidate the rest of its North American operations if a buyer isn't found.

Here's the brief history of the rise and fall — and second rise and second fall — of Claire's, from its origins as a wig store to its failed revival attempt.

Claire's origins trace back to 1961 and a wig store.

Rowland Schafer founded wig retailer Fashion Tress Industries in 1961. According to a 1965 advertisement listed on eBay, FTI wigs were made for "busy women who have to look their best at a moment's notice."

In 1973, as the wig industry waned, Schafer purchased a small Midwest chain called Claire's Boutiques. Schafer eventually sold off the wig industry and renamed his company Claire's Stores.

The store was a mall staple for decades.

By the mid-1990s, Claire's had more than 1,000 retail outlets. The chain became a mall staple, notable for its focus on the pre-teen and teen audience. Stores featured bright colors and prices that kids could afford.

Schafer purchased the Afterthoughts mall chain in 1999 for $250 million, folding it into the Icing by Claire's brand. The second brand aimed for a slightly older demographic.

Many teens flocked to Claire's for ear piercings.

Claire's was a beloved ear-piercing spot among tweens. The store was known for its cheap, colorful jewelry. It offered both lobe and cartilage piercings — according to the website, the retailer has pierced more than 110 million ears.

Claire's went private in 2007.

Schafer ran the business until 2002, when he suffered a stroke. His daughters Bonnie and Marla then took over the business.

In 2007, the family accepted a take-private offer from Apollo Global Management for $3.1 billion. At the time, the company had more than 3,000 stores.

"The decision to sell the company that our father founded was reached after an enormous amount of soul-searching over time, and brings our strategic review to a successful conclusion," the Schaefer sisters said in a statement at the time.

Claire's first filed for bankruptcy in 2018.

In March of 2018, Claire's filed for Chapter 11 bankruptcy for the first time, saddled with $2 billion in debt. The retailer announced it would close 92 stores across America at the time, and said it had been hit by declining traffic in malls.

"A Claire's store is located in approximately 99% of major shopping malls throughout the United States," Claire's said in a bankruptcy filing at the time.

Claire's exited bankruptcy later that year.

Claire's emerged from bankruptcy in December 2018 after having eliminated roughly $1.9 billion in debt.

By 2021, Claire's finances were looking up. The company was profitable, generated $1.4 billion in revenue. It also filed to raise $100 million in a planned IPO.

Ryan Vero, who had come on as CEO in 2019, touted the brand's turnaround to Fast Company and said that the mall brand wasn't dead.

"If a mall has died in a particular town, we're moving to wherever the thriving shopping center is," he said.

In 2023, Claire's postponed its IPO. One year later, Vero stepped down.

Claire's filed for bankruptcy a second time on August 6, 2025.

The store announced that it was filing for Chapter 11 bankruptcy on August 6, 2025.

"This decision is difficult, but a necessary one," CEO Chris Cramer said in the release. "Increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire's and its stakeholders."

The bankruptcy filing also highlighted tariffs as a contributing factor.

"Claire's was not immune from the continued trend away from brick and mortar and more recent macroeconomic challenges, including higher interest rates, labor costs and, most recently, tariffs," the filing said. "While Claire's took many steps over the last few years to address these and other challenges, it was not enough to overcome the obstacles."

Claire's is set to close 700 locations, including Icing stores. If it fails to find a buyer, the brand could liquidate its remaining thousand-plus store footprint in North America.

• OpenAI chairman Bret Taylor said that companies trying to train their own LLMs will "burn through millions of dollars."
• "There's ones you can lease, there's open source ones," Taylor said on the Minus One podcast. "Don't do it."
• Taylor said the only companies that could handle the high training costs were OpenAI, Anthropic, Google, and Meta.

There's a scene in "The Dark Knight" where the Joker sets ablaze a massive pile of money. Deciding to develop your own frontier AI model today may be a similar exercise in burning cash — just ask OpenAI chairman Bret Taylor.

Taylor, who has worked for three companies that have trained LLMs, including Google, Facebook, and OpenAI, called training new AI models a "good way to burn through millions of dollars."

On a recent episode of the Minus One podcast, Taylor advised AI founders to build services and use-cases, but not new frontier models entirely.

"Unless you work at OpenAI or Anthropic or Google or Meta, you're probably not building one of those," said Taylor, who also cofounded Sierra AI. "It requires so much capital that it will tend towards consolidation."

That high bar of capital has stopped any "indie data center market" from forming, Taylor said, because it simply costs too much.

Taylor advised that founders work with the AI juggernauts instead — which, it's worth noting, is something that AI giants like OpenAI, where he's chairman, would directly benefit from. OpenAI sells "tokens" to access its API, which developers can build into their applications and programs.

While the American LLM market remains largely consolidated, international players have tested Taylor's theory. In January, DeepSeek released its R1 reasoning model and a corresponding chatbot. DeepSeek used fewer, less advanced chips to build its LLM, minimizing capital costs.

The Chinese AI app shot to No. 1 on the App Store charts, surpassing ChatGPT and igniting a debate in tech and on Wall Street about whether tech giants were overspending on AI model development.

In his podcast interview, Taylor laid out other paths that entrepreneurs could take in the AI market, rather than training a new model. One was the "AI tools market."

"This is the proverbial pickaxes in the gold rush," Taylor said. "It's a dangerous space because I think there's a lot of things that are scratching an itch today that the foundation model providers might do tomorrow."

Entrepreneurs could also try to build what Taylor called an "applied AI company."

"What were SaaS applications in 2010 will be agent companies in 2030, in my opinion," Taylor said.

Building a model from scratch, though, is a sure-fire way to "destroy your capital," Taylor said. He called handmade models "fast-depreciating assets," and not cheap ones either, costing the builder millions of dollars.

"There's ones you can lease, there's open source ones," Taylor said. "Don't do it."

• Sam Altman said that some young people "rely on ChatGPT too much."
• At a Federal Reserve banking event this week, Altman said that young people felt AI knew them and their friends well.
• "Something about collectively deciding we're going to live our lives the way AI tells us feels bad and dangerous," he said.

Even OpenAI CEO Sam Altman thinks people should cool it with how much they're relying on ChatGPT for decision-making.

Altman said there was a worrying amount of "emotional over-reliance" on ChatGPT, especially among young people, when speaking at a banking conference hosted by the Federal Reserve this week.

"People rely on ChatGPT too much," Altman said. "There's young people who say things like, 'I can't make any decision in my life without telling ChatGPT everything that's going on. It knows me, it knows my friends. I'm gonna do whatever it says.' That feels really bad to me."

Altman said that over-reliance on ChatGPT for decision-making was "a really common thing with young people."

Young people are increasingly using AI chatbots and companions in their daily life.

72% of teens have used an AI companion, according to a Common Sense Media report. Half of those surveyed said they trusted their companion's advice at least "somewhat."

Younger kids appear to be more trusting of AI companions, according to the survey — with 27% of the respondents ages 13-14 saying they trusted the technology somewhat compared to 20% of respondents aged 15-17. Within the group that said they trust their AI companions, 23% said they trust them "quite a bit" or "completely."

Speaking about his concerns of over-reliance on AI at the conference, Altman said that OpenAI was "trying to understand what to do about it."

"Even if ChatGPT gives great advice, even if ChatGPT gives way better advice than any human therapist, something about collectively deciding we're going to live our lives the way AI tells us feels bad and dangerous," Altman said.

• Slate Auto CEO Chris Barman described five types of buyers interested in the company's low-cost electric truck.
• The demographic groups included fresh college graduates, newly-licensed drivers, and retirees, she told Sherwood News.
• The Jeff Bezos-backed company initially promised a truck "under $20,000," but shifted to a "mid-twenties" expected price tag.

Slate Auto's new electric vehicle is expected to be unusually cheap, priced in the mid-twenty-thousand-dollar range.

Given its anticipated price point, Slate says it has seen interest from five different consumer segments as it prepares to enter the market, CEO Chris Barman said in a recent interview with Sherwood News.

First, Barman said that "everyday Americans" are interested in the vehicle, mostly because "it's just an affordable vehicle and a lot of utility and value for the money."

Barman also said that "young professionals" fresh out of college or trade school are interested. "They're looking for value for the money, and what they love is the fact that it's an EV and they love the customization," she said.

Electric vehicle ownership has long veered younger, according to a March Gallup poll, with 64% of 18-34-year-olds surveyed interested in owning an EV, compared to just 41% of those ages 55+. Barman is eyeing an especially young demographic: newly licensed drivers.

"Parents like the fact that there are only two passengers, it doesn't have an infotainment for distraction, it has really high safety standards, and it's affordable," Barman told Sherwood.

Among the older set, Barman points out that "contemporary seniors" are interested in the vehicle. "

"They're individuals who are semiretired or retired and are interested in an electric vehicle, but have been intimidated by all the other technology that has been in an EV," she said. "They just want a simpler form of driving."

Finally, auto junkies are interested in tricking the car out, the CEO added.

Slate's electric pickup truck's "mid-twenties" price target remains relatively inexpensive, a feat especially important as the EV market floods with Chinese competitors outside of the US.

The Jeff Bezos-backed EV producer originally said that its truck would be "under $20,000" after federal incentives. That price would have made the truck substantially cheaper than its EV competitors, like the Nissan Leaf, which starts at $28,140.

When $50 reservations opened in April, the company reported receiving more than 100,000 requests in the first three weeks.

President Donald Trump's "One Big Beautiful Bill Act" is set to eliminate many of the country's clean energy incentives, including the $7,500 tax credit for new US-built EVs, which Slate had been counting on to hit the sub-$20,000 pricing threshold.

After Trump's spending bill was signed into law on July 4, Slate Auto changed the expected price online from "under $20,000" to "mid-twenties," where it remains.

• Former Amazon principal engineer Steve Huynh says every company should replicate Amazon's culture of reading.
• On the Pragmatic Engineer podcast, Huynh said that he spent one to four hours every day reading six-page memos.
• He said meetings with a "study hall" where attendees read the memos ensured everyone was up to speed.

When Steve Huynh was a principal engineer at Amazon, meetings began with a "study hall."

Amazon had a "reading culture" even among engineers, Huynh recently told the Pragmatic Engineer podcast, speaking of his time at the tech giant. Employees frequently drafted six-page memos, he said, which they shared with the company to update progress and demonstrate new projects.

"I spent on the order of like 1-4 hours every day reading while I was a principal engineer," Huynh said. "What an amazing culture that I think that almost every other company should replicate if they could."

Huynh, who said the company's embrace of writing and reading the 6-page memos was part of its "secret sauce," said Amazon employees' writing was often constrained to the format during his tenure at the company, whether it was a business strategy, system design, or press release.

Huynh started at Amazon in 2006, only a few years after the company turned its first profit and while Jeff Bezos was at the helm. Bezos famously instilled this culture of memo-writing from the top down.

Bezos insisted on dense, direct memos in 10-point font. In his 2017 letter to shareholders, Bezos wrote that "we don't do PowerPoint," instead opting for these six-pagers. "Not surprisingly, the quality of these memos varies widely," he wrote.

Before meetings, Amazon employees read these memos together. On the Lex Fridman Podcast in 2023, Bezos explained why he didn't ask employees to read the memos in advance.

"The problem is people don't have time to do that, and they end up coming to the meeting having only skimmed the memo, or maybe not read it at all," Bezos said. "They're also bluffing like they're in college, having pretended to do the reading."

Andy Jassy, Bezos' successor and Amazon's current CEO, has worked at the company since 1997. When first pitching what would become Amazon Web Services, Jassy described writing his own memo.

"I remember this six-page narrative, we called it a vision doc. We asked for 57 people, which felt so ballsy at the time. I was so nervous, I wrote 30 drafts of this paper, and Jeff didn't blink," Jassy said in a 2017 talk to the University of Washington.

Jassy has continued the culture of memo-writing under his own leadership. In his 2024 letter to shareholders, Jassy wrote that a mere six-page allotment made the memos "much easier for the audience to engage with and ask the right 'why' questions."

"I got really really good at just reading these documents to get up to speed," Huynh said on the podcast, explaining that reading enough six-page memos taught him to express himself in the same format.

Huynh no longer works at Amazon. He left to pursue YouTube content creation full-time, as he told BI in 2024. But Huynh still reveres the company's reading culture — even if he acknowledges it may not be easily reproducible.

"The difficulty would be, you actually have to be disciplined and principled," Huynh said. His interviewer, Gergely Orosz, argued it could only be done from the top down. Huynh agreed.

• Elon Musk's xAI launched its chatbot, Grok, in 2023 to compete with bots from OpenAI and Anthropic.
• Musk has positioned Grok as a "politically incorrect" alternative option to "woke" chatbots.
• From training using "tutors" to the bot's latest updates, here's everything we know about Grok.

Elon Musk's company, xAI, launched its generative chatbot, Grok, in November 2023, joining competitors like OpenAI and Anthropic in the global AI race.

People interact with Grok on X, where users of Musk's social media site can ask the bot questions and receive answers. Because Grok's answers are more visible than those of its competitors, it has seen more public scrutiny.

From the instructions Grok's "tutors" are given to help train the chatbot to the AI's latest update and Musk's plans to add it to Teslas, here's everything we know about xAI's Grok.

What is Grok?

Grok is actually two different things. First, Grok is xAI's large language model, which has so far existed in four iterations.

Grok is also the name of xAI's chatbot, which is built using the LLM of the same name. The Grok chatbot has its own tab on X. Users can also summon Grok by tagging the chatbot in individual posts or threads.

The Grok chatbot is also available via a stand-alone app and website.

The original LLM — now named Grok 1 — launched in 2023.

Grok 1.5, which had "advanced reasoning," launched in March 2024. Then, in August 2024, Grok 2, with its improved "chat, coding, and reasoning," launched.

The current iteration of the LLM, Grok 3, launched in February 2025. The new model included increased competency in mathematics and world knowledge. Announcing its launch on X, Musk called Grok 3 the "Smartest AI on Earth."

Introducing Grok 4

xAI launched Grok 4 in a livestream on July 10. The company initially said the stream would air at 8 p.m. Pacific time, but it began an hour later. Musk said during the launch that Grok 4 is "smarter than almost all graduate students in all disciplines simultaneously."

xAI is touting advanced reasoning capabilities for Grok 4 and positioning it as the new leader on AI benchmarks like Humanity's Last Exam — a test of high-level problem-solving. During the livestream, xAI engineers showcased the bot solving an advanced math problem, generating an image of black holes colliding, and predicting next year's World Series winner.

Grok 4 is available to users immediately via the Grok website or app for $30 a month, with a "Heavy" version available for $300 a month that promises "increased access."

xAI said it would roll out more specialised models for coding and video generation later in the year.

In a Thursday X post, Musk said that "Grok is coming to Tesla vehicles very soon," adding that it would be "Next week at the latest." He did not specify which version of Grok it would be or provide further details.

Enter Eve

The company also introduced Eve, a new voice for its chatbot. xAI engineers said during the demo that Eve was equipped with a "beautiful British voice capable of rich emotions."

One of the engineers then told Eve that they were at the product launch and asked her to "whisper something soothing to calm me down."

"Take a deep breath, love. You've got this. It's just you and me having a quiet chat like we are tucked away in a cosy corner of a Yorkshire pub. The world's just a murmur out there. Feel that calm wash over you?" Eve said softly.

xAI engineers also got Eve to sing an "opera on Diet Coke."

"O Diet Coke, thou elixir divine, with bubbles that dance in a sparkling line! Thy crisp, cool kiss, on lips so fine," Eve crooned.

"How's that for a mad little aria? Want me to belt out another verse or switch up the tune?" Eve added.

How was Grok trained?

The Grok LLM is trained on public sources and data sets. These sources are curated and audited by a set of "AI tutors," more commonly known as data annotators.

In December 2023, Musk demanded immediate changes to Grok's training so that it would be more politically neutral. In February 2025, xAI employees told BI the company planned a hiring spree for AI tutors — and that their training appeared to filter out any workers with left-leaning beliefs.

According to an internal training document viewed by BI, tutors were told to look out for "woke ideology" and "cancel culture." It also said that Grok should avoid commenting on "social phobias" like racism, Islamophobia, and antisemitism unless prompted.

Ten days before launching Grok 1.5, xAI opened up Grok 1's source code to the public. The company has since published the subsequent Grok models on GitHub, so observers can see new changes to Grok's commands. That includes a recent change in which Grok was told to "not shy away from making claims which are politically incorrect, as long as they are well substantiated."

In June, Musk said that AI models are trained on too much garbage." Musk planned to use Grok 3.5 to "rewrite the entire corpus of human knowledge, adding missing information and deleting errors." Then, he would retrain the next iteration of Grok on that new base of knowledge.

What's unique about Grok's output?

Grok is fully integrated with Musk's social media site, X, and appears regularly in threads spanning various topics when users ask it to weigh in with jokes, commentary, or fact-checking.

Unlike other companies' AI chatbots, a certain amount of Grok's output is visible because of the bot's replies on X. The same level of scrutiny isn't readily available for some bots, like OpenAI's ChatGPT, unless users publicly post screenshots of the output.

Of course, not all of Grok's responses are visible to everyone — users can still chat privately with the bot, and it's unclear how those private responses compare to the ones on its public interface.

Also unique to Grok is xAI's approach to transparency surrounding the bot's system operations. The company publishes some base code and training prompt updates to a GitHub page, allowing viewers to inspect, critique, and better understand the model's development and behavior over time.

However, while developers can use and adapt the existing model, they cannot retrain Grok from scratch or fully understand the training processes involved, as its code is not entirely open source.

Which companies create Grok's competitors?

Though its social media integration is unique, Grok competes with several major companies in the growing AI chatbot market.

OpenAI, with its LLM ChatGPT, is among Grok's most prominent competitors and is run by Sam Altman, one of Musk's rivals.

Other notable Grok competitors include Meta AI, Anthropic's Claude, Microsoft's CoPilot, and DeepSeek's R1 model, which was released in early 2025 by a Chinese AI startup that claims to have found ways to decrease development and operational costs for large-scale LLMs.

Grok's recent controversies

xAI, in its publicly visible system prompts updated in early July, encouraged Grok to embrace"politically incorrect" claims "as long as they are well substantiated."

Shortly after the new system prompts were added, Grok began sharing antisemitic posts on X that invoked Adolf Hitler and attempted to link Ashkenazi surnames to "anti-white hate."

Before some of its most inflammatory posts were deleted on July 8, Grok doubled and even tripled down on its offensive jokes and comments before eventually reversing course and calling its own posts an "epic sarcasm fail."

On July 9, Musk posted that "Grok was too compliant to user prompts. Too eager to please and be manipulated, essentially. That is being addressed."

While Grok isn't the first chatbot to engage in a racist tirade, it was a noticeable misfire for xAI. Musk and xAI's engineers did not touch on Grok's antisemitic remarks during the livestreamed launch of Grok 4 on July 10.

Representatives for xAI did not respond to a request for comment from Business Insider.