AI, AI, and more AI
Happy Friday! This was a busy week that really flew by. Thanks to my never-boring reporting assignment of covering technology mergers and acquisitions. The rollout of DeepSeek, more rumors on buyers for TikTok, and the new fundraising round for OpenAI, have kept me busy.
On Monday, as the market saw tech stocks plummet in reaction to DeepSeek's AI, I asked some people familiar about what this means for their clients. They told me that services-heavy businesses, for instance, which rely on their employee headcount, were especially concerned for their future. The threat of jobs being replaced by AI has become a lot more real this past weekend. Moreover, thanks to AI, subscription-based software models may be less favored than outcome-based business models in software, people familiar added. What do you think of it, readers?
Outside of the big AI topic, people familiar have started to cast skepticism on whether this year is going to be that great and that busy, as they originally anticipated.
The notion of a much more relaxed anti-trust policy is beginning to fade as well, after the U.S. Department of Justice has sued to block Hewlett Packard Enterprise's $14 billion deal to acquire networking gear maker Juniper Networks, arguing that it would stifle competition.
It's been a long week and I have a lot of thoughts, as you can see. But I will stop here, and wrap it up.
In AI...
My colleagues Krystal Hu , Anna Tong , and I reported that SoftBank Group is in talks to lead a funding round of up to $40 billion in artificial intelligence developer OpenAI at a valuation of $300 billion, including the new funds, sources said, in what could be a record single funding round for a private company.
The funding comes as Chinese startup DeepSeek has launched an inexpensive AI model that has caught worldwide attention and challenged expectations of what it costs to develop and deploy AI.
Still, SoftBank has valued OpenAI, the maker of ChatGPT, at $260 billion going into the funding round, up from $150 billion a few months ago, the sources, who requested anonymity to discuss private matters, told Reuters.
In software...
I reported that Japanese technology group NEC Corp has been talking to its advisers about the possibility of making an offer for CSG Systems, which provides customer care and billing solutions for cable and phone companies, according to people familiar with the matter.
Tokyo-based NEC has been working with investment bankers at Morgan Stanley on a potential offer for CSG, which has explored a sale over the past year, the sources said, requesting anonymity as the discussions are confidential.
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In fintech...
David French and I reported that DailyPay , a financial services firm that helps workers access their pay early, has kicked off preparations for a potential U.S. stock market listing that could come as soon as the second half of the year, according to people familiar with the matter.
The New York-based company is in talks to hire investment bankers for its planned initial public offering that could value the company between $3 billion and $4 billion, the sources said.
Other TMT news and commentary:
TMT people moves:
What else is going on? For any anonymous deal tips you can find me on Signal (@MilanaVinn.01) and Telegram (@milanavinn). I am also available by email [email protected] and via cell.
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Have a great weekend!
Milana