Daily Musings

Billion Dollar Unicorns and My Two Cents

Author

Philip Kurzrock
September 18, 2024 • Today's Reading Time: 3 minutes

Evening all

If we knew what we were doing, it would not be called research

Einstein famously claimed

For proof of this, one needs to look no further than the frantic changes in economic researchers’ opinions about J Pow’s rate decision. Reminiscing of my glory days as an equity researcher, I do not claim or dispute to know what I am doing as I share today’s musings.

Cheers
Philip

Today’s Stories

  • MSFT and Blackrock to launch a USD 30bn AI Infra fund. Big move for the wider infra and AI space, after BlackRock pivoted into the space acquiring GIP recently

  • The FT reports Insight Partners is looking to close the 13th multibillion dollar vintage. Volume earmarked at an impressive USD 10 - 12bn. Yet. Investors want more. Initial commentary already critiques the significant step down from the last achieved fund volume of USD 20bn. Insight is a household name in the large-cap VC space - investment hits include cybersecurity venture Wiz

  • Poland’s largest fund of funds - PFR Ventures - has distributed its first allocations to early-stage VCs. Originally they planned to deploy at the start of 2023. now after politically induced delays, the fund hopes to channel EUR 490m into 40 early-stage VCs. 12 VC managers have already been bookmarked. Four VCs have been confirmed:

    • 24Ventures. EUR 12.6m first close of a new fund. Looking to invest in 18 startups in the next four years. Focus on digital transformation and ClimateTech

    • Digital Ocean Ventures Starter. First close @ EUR 8.4m. Focus on FinTech and AI

    • Hard2beat. Raised EUR 19.6m to invest in 20 DeepTech startups

    • Tar Heel Capital Pathfinder. Raised vintage #2 @ EUR 18.7m. Aims to write 30 tickets in AI, SaaS, marketplaces, CleanTech, EdTech, MedTech and cybersecurity

Chart Art

Bloomy tables outline interesting macro sentiment. US economic data for industrial production is resilient. Retail sales are down (only online shopping performed stellarly) - speaks for considerable economic pressures on lower-income households. Yet. Markets have completely changed gear in sentiment: within hours traders are now placing high odds on a 50bps cut tomorrow. The market is pricing a 66% for 50. The majority of economists expect 25. An unprecedented divergence. Latest figures:

118 economists surveyed

  • 4: unchanged

  • 101: 25bps

  • 13: 50bps