A lot of ink—and keyboard strokes—have been dedicated to how the pandemic has accelerated the move to the cloud and the application of AI in a vast array of business contexts. AI is transforming every industry you can think of as businesses figure out ways to support remote work, automate business processes, and deliver customer value without requiring in-person interaction. In one sense, AI tools have been democratized; resources and tool-kits are readily available to any company looking to innovate. But as much as it may seem obvious that organizations need to apply AI to their business, execution isn’t so easy.… Read more...
Cryptocurrencies are now estimated to be worth roughly $2 trillion and — despite pressure from regulators — demand from investors continues:
In July 2021, FTX—the Antigua-based cryptocurrency derivatives exchange which offers futures, leverage tokens and OTC trading—raised $900 million from over 60 investors. This included venture capital firms Paradigm and Sequoia, hedge funds and the private equity group Thoma Bravo. It was the largest private equity deal in the crypto industry’s history, valuing the business at $18 billion—one of the largest rounds of financing for a digital assets startup.
In May 2021, Block.one —the Peter Thiel, Alan Howard and Louis Bacon backed blockchain software firm—pumped $9.7 billion into a new cryptocurrency exchange subsidiary called Bullish Global.
Jeffrey Funk and Gary Smith, well known to many of our readers, have just published an article at MarketWatch, warning against heedless optimism about “unicorn” stocks. As they put it, “The stock market unleashes its ‘animal spirits’ on an animal that doesn’t exist.” They begin by pointing out that most new businesses flop.
The president of one venture capital company estimated the chance of success at one in 1,000. An SEC study of 500 randomly selected new issues found that 43% were confirmed bankrupt, 25% were losing money but still afloat, and 12% had disappeared without a trace. Of the remaining 20%, just 12 companies seemed solid successes — a scant 2% of the companies surveyed.
No successful VC pitch starts with a 50 page white paper. It’s about explain the problem you solve, your added value, what it will cost, and how will you make money.
Most of the developing world lives out of $2 a day. They are not going to switch to cryptos to lose suddenly $1 because some hacker, ‘authority’ or whale cracks into some marketplace.
Large institutions are not going to risk trillions of dollars in some immutable but trackable database. Rely on some Russian teenager to unfreeze funds is not a viable option for fund managers. If you solve one problem by creating bigger ones you haven’t solved anything.… Read more...