From trying to woo to trying to sue
Happy Friday. Welcome to The Chaos Coordinator! We are Brain Candy's snarky little sister, delivering carefully curated news happening across the industry (that you should probably care about) right to your inbox, with a hefty dose of irreverence.
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In this issue, we dive into:?
What's happening in.....
PE/VC?
Optimism in the Dealmaking Landscape Reignites?
All it took was nearly a half-trillion dollars.?
Private equity firms have amassed a massive $722 billion in dry powder as of June 30, marking a 9% increase from the previous year. According to Bloomberg, they’re gearing up for a deals comeback. This surge in readily available capital comes as the Federal Reserve is expected to cut interest rates. "The macro, inflation, and rates backdrop has improved; markets are open—and the deal market is back," said KKR Co-Chief Executive Scott Nuttall. Recent years saw deal-making slow due to high debt costs, but now firms like KKR, Apollo Global Management, Blackstone, and Carlyle Group are actively pursuing opportunities. TPG CEO Jon Winkelried highlighted the potential of the current market, noting, "Periods of market dislocation create compelling investment opportunities."
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Read more here.?
Capital Markets
The Regulation Police Are Back At It Again?
What do you call an AI chip that’s always getting into trouble? A snacktivist! Or in this case, a product of Nvidia.?
Chip giant Nvidia is facing significant regulatory scrutiny. Not long after a federal judge ruled against Google for antitrust violations, the US Department of Justice began investigating Nvidia’s sales practices and recent acquisitions, signaling a tightening grip on big tech. Nvidia is feeling the pressure, especially since it hasn’t established the same kind of connections in Washington as other tech giants. CEO Jensen Huang hasn’t been a regular visitor to DC, and this is becoming apparent as the company deals with its newfound spotlight. “Nvidia wasn’t ready for the attention it has received from the AI boom and subsequent scrutiny," The New York Times noted. Despite Nvidia’s rise to become one of the top tech companies globally, some argue it may be too early to label it a monopoly. The AI industry is still relatively young, with other players like AMD and Amazon also making strides in the field. Meanwhile, the regulatory landscape itself is wildly chaotic: the US is addressing these issues through individual lawsuits, while Europe is taking a slower approach with new laws that could take years to fully implement.?
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Read more here.?
Generative AI / Tech?
Powering Artificial Intelligence?
Prepare for more ConEd texts about conserving energy.
While the excitement around artificial intelligence has cooled, investors are increasingly focusing on the utilities sector, which has become the second-best performer in the S&P 500. Fund managers are seeing investors pour billions of dollars into the sector even as concerns grow about whether tech companies’ enormous spending on A.I. will pay off, reports the NYT. This shift is driven by the massive power demands of AI-driven data centers, which require vast amounts of electricity and water. Utilities like Duke Energy and Dominion Energy are capitalizing on this trend, securing deals with tech giants like Google, Microsoft, and Amazon. The growing AI boom could increase U.S. electricity demand by up to 20% by 2030, raising concerns about the current power grid's capacity. As a result, there's renewed interest in low-carbon energy solutions, such as nuclear power, to support this demand while helping tech companies achieve their net-zero goals.?
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Read more here.?
Marketing
From Trying to Woo to Trying to Sue?
Maybe this is why we don't tell advertisers to "go f*ck themselves," Elon.?
X (formerly Twitter) has filed an antitrust lawsuit against the Global Alliance for Responsible Media (GARM), the World Federation of Advertisers (WFA), and several prominent brands, including CVS Health, Mars, Orsted, and Unilever, alleging that these groups and brands organized a boycott against X, leading to significant financial losses for the platform. CEO Linda Yaccarino shared an open letter accusing the advertising industry of damaging behavior. Since Elon Musk's acquisition, ad spending on X has sharply declined, with major advertisers abandoning the platform due to perceived reputational risks. The lawsuit hinges on a report from the House Judiciary Committee that claims to have evidence of this organized boycott. The complaint suggests that the boycott is part of a broader issue where brand safety standards are being used to target right-wing media. Despite efforts to mend relationships, including reinstating ties with GARM, X has struggled to regain advertiser confidence, with a 73% drop in ad spending by top advertisers since Musk took over. X's revenue has seen a steep decline, with internal documents showing a 53% year-over-year drop in U.S. revenue.?Marketing consultant Lou Paskalis commented that the reputational risks of advertising on X far outweighed any benefits, a sentiment echoed across the industry, further exacerbating X's challenges in the advertising market.
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Read more here.?
Chaos Connections
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