How Generative A.I. Is Changing This VC's Investment Decisions | Marketing When Budgets Are Down | Inside Paypal’s Billion Dollar Battle For Payment Processing Dominance | FTX was a boys’ club. When Caroline Ellison asked Sam Bankman-Fried for equity in the hedge fund she ran, he said ‘it was too complicated’

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How Generative A.I. Is Changing This VC's Investment Decisions - Inc.com

Linus Liang loves working with founders to build companies from the ground up. After eight years at venture capital firm Signia, Liang set out on his own this year, co-founding Kyber Knight Capital, a San Francisco-based firm that invests in early-stage tech companies, particularly those in artificial intelligence, e-commerce, and media. Kyber Knight's inaugural $120 million fund launched in June, with limited partners including former eBay and HP CEO Meg Whitman and former Walt Disney chairman and CEO Michael Eisner.

With his new fund, Liang's investment strategy has radically shifted in response to the boom in artificial intelligence startups, which he calls "the most exciting opportunity we've seen in a decade."

The cost to start a new company now is so cheap, he says, that he's now putting extra scrutiny on any potential investment's go-to-market strategy--their plan to get a product in front of consumers. "One or two people can start up something in a weekend, versus before it took years and millions of dollars," says Liang. "That's disrupting the whole funding landscape on the VC side and on the entrepreneur side."

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Marketing When Budgets Are Down - Harvard Business Review

The general rule of enterprise finance is that marketing budgets drop like a stone at the first sign of trouble and rise like a feather once the environment is more settled. In mid-2023 we’re far from a settled state — projected GDP growth in western markets is depressingly flat, inflation is proving to be rather stubborn, and those disruptions just keep on coming. It’s tough to see a significant increase in marketing budgets in the near term. Gartner’s annual survey of hundreds of CMOs charts the evolution of marketing spending over recent history, offering guidance for how enterprise leaders can deliver results and build the capabilities to fuel growth in a time of less.

Marketing’s digital transformation brought with it unprecedented growth, both in the scope of the function and in its spending power. New channels, new technologies, and new capabilities demanded new levels of investment. But the good times couldn’t last forever, and the pandemic ushered in a new, more austere era as budgets flatlined. This placed chief marketing officers (CMOs) under pressure to reduce spending on previously sacrosanct parts of their portfolio, such as marketing technology.

Gartner’s annual survey of hundreds of CMOs charts the evolution of marketing spending over recent history, offering guidance for how enterprise leaders can deliver results and build the capabilities to fuel growth in a time of less.

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Inside Paypal’s Billion Dollar Battle For Payment Processing Dominance - Forbes

Consumers rarely even think about who processes their payments at checkout. Whether it's being handled in the back offices of a traditional bank like JPMorgan or by a fintech like PayPal or Stripe, it merely needs to be fast, and hassle free. However, behind the scenes there is a battle underway to control 'buy now' technology. Last year e-commerce sales in the U.S. alone surpassed $1 trillion, from which billions in revenues and profits flowed to dozens of firms vying to be at the center of the transactions.

Among processors PayPal, with $27.5 billion in 2022 revenues, is an industry giant. In September, its new CEO Alex Chriss, 46, took the reins, inheriting a company that has embraced a risky low price strategy, similar to Dell's approach to selling IBM PC clones in the 1990s. Last year, the San Jose company began cutting the cost of payment services it offers under its Braintree brand, a white-label service that lets companies small and large accept debit cards, credit cards and other payment methods from consumers. Research firm MoffetNathanson estimates that Braintree revenue jumped to $8.4 billion in 2022 from $6.2 billion in 2021, making up roughly 30% of PayPal's total net revenue. Braintree is now growing faster than other parts of PayPal and unbranded transactions, which are mostly driven by Braintree, jumped 40% in 2022. PayPal's branded business, when consumers click on the yellow PayPal button, grew only 5% in 2022.

"PayPal was doing something to juice that growth and it was likely giving it up on pricing," says Chris Donat, fintech and payments research lead for BWG Strategy.

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FTX was a boys’ club. When Caroline Ellison asked Sam Bankman-Fried for equity in the hedge fund she ran, he said ‘it was too complicated’ - Fortune Crypto

Caroline Ellison is arguably the star witness in the government’s case against Sam Bankman-Fried, the former CEO of the bankrupt crypto exchange FTX who’s on trial for fraud. And what became apparent during her testimony on Tuesday is that, compared with three other key lieutenants who’ve all turned on their former boss, she took similar risks for far smaller rewards.

Ellison, who testified that she conspired with Bankman-Fried “to commit these crimes,” is the former CEO of Alameda Research, a crypto hedge fund Bankman-Fried also owned. She was given no equity in Alameda and only a half-a-percentage-point stake in FTX. When she broached a conversation with him over receiving equity in the hedge fund, he was “initially receptive” but later told her “it was too complicated.”

Gary Wang, cofounder and the former CTO of FTX, had a 16% stake in FTX and a 10% stake in Alameda. Nishad Singh, former director of engineering at FTX, owned 5% of the company, according to Michael Lewis’s recent SBF tell-all. And Bankman-Fried owned the lion’s share—90% of Alameda and more than half of FTX, per Lewis.

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