Good Morning! Nvidia stock bounced back after Microsoft indicated it would continue to invest heavily in AI. Instagram accidentally permanently deleted some users’ photos, while parent company Meta crushed Q2 earnings. Boeing named aerospace industry vet Kelly Ortberg as new CEO. Delta revealed the CrowdStrike woes will cost the airline $500 million. Taco Bell is rolling out new AI drive-through ordering. Watching the Summer Olympics on your phone during work? You might be contributing to $2.6B in lost productivity. Plus why Americans are snubbing McDonald’s and Starbucks.

High returns, recurring monthly income, diversification–private credit is a $1.9 trillion asset class, and everyday investors can invest today with Percent.

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Ackman’s IPO Bust

Hedge fund titan Bill Ackman officially withdrew his IPO for Pershing Square USA yesterday. 

Ackman had aimed to capitalize on his growing influence among retail investors, boasting one million followers on social media platform X, where he often shares his thoughts on just about every topic in his lengthy tweet essays.

The IPO would have provided a rare opportunity for the public to invest directly in a hedge fund, with Ackman intending to model the offering after Warren Buffett’s Berkshire Hathaway.

Ackman initially sought to raise around $25 billion for Pershing Square’s IPO. But last week, Ackman revealed in a regulatory filing he was looking to raise just a fraction of that - $2 billion. 

It sounds like Ackman saw the writing on the wall - the investors he needed just weren’t that interested. Many institutional investors questioned if they were better off waiting for the stock to start trading rather than purchasing shares at the IPO.

Baupost decision’s to pull out may have been the final nail in coffin for Ackman, after Ackman had previously touted Baupost's involvement as a significant endorsement in a letter to investors.

Ackman issued a statement acknowledging the challenges: "While we have received enormous investor interest in PSUS, one principal question has remained: Would investors be better served waiting to invest in the aftermarket than in the IPO? This question has inspired us to reevaluate PSUS’s structure to make the IPO investment decision a straightforward one. We will report back once we are ready to launch a revised transaction."

Takeaway: 25 different investment banks were reportedly working on the deal - so pour one out for the analysts who had their last weekend in July blown up for nothing. But don’t worry - Ackman says he’ll be back with a revised transaction, and he seems like the type of guy who means what he says.

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Investing in Private Credit Could Help Hedge Your Portfolio Against the Next Downturn

The stock market is burning red hot these days, which has many investors wondering: If a market correction happens, where can we ride out the storm? 

A Bloomberg survey¹ reveals that many institutions now prefer private credit over bonds to hedge against economic downturns. 

Why? T. Rowe Price data² suggests that allocating 10% to private credit historically reduces volatility and improves risk-adjusted returns. 

But this ‘safe haven’ asset class isn’t just for Blackstone, KKR, and Morgan Stanley–now, everyday investors can diversify with private credit using Percent. 

• Low minimums: Start with $500

• Shorter durations: Maturity in 6-36 months (average ~9 months)

• Monthly cash flow: Most deals offer cash flow through monthly interest payments.

• Return potential: Percent boasts a net return over 14% in the last 12 months as of Q1 2024

Sign up with Percent and get a bonus of up to $500 with your first investment.

_HEADLINES

Top Reads

• Nvidia and chip shares soar as Microsoft increases AI spending (FT)

• Global chip stocks rally (CNBC)

• Instagram just permanently zapped some people’s photos (CNN)

• Meta beat Q2 earnings (CNBC)

• Boeing names Kelly Ortberg CEO to steer turnaround (YF)

• Delta CEO says CrowdStrike-Microsoft outage cost the airline $500M (CNBC)

• CrowdStrike is sued by shareholders over huge software outage (YF)

• Taco Bell to roll out AI drive-thru ordering (Axios)

• Powell says September rate cut ‘on the table’ if inflation data continues to cool (CNBC)

• The Summer Olympics are costing American companies $2.6B in lost productivity (MW)

• Why Americans are snubbing McDonald’s and Starbucks (CNN)

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Markets Rundown

Stocks closed higher because of the chip rally, Fed willingness to cut rates.

Movers & Shakers

• (+) Match ($MTCH) +13% after Tinder and Hinge’s parent company announced job cuts; strong earnings.

• (+) Nvidia ($NVDA) +13% after Microsoft indicated it would continue to invest heavily in AI.

• (–) Pinterest ($PINS) -14% after announcing weak guidance.

Private Dealmaking

• American Industrial Partners bought assets from Veolia North America for $620 million

• Flo Health, a women’s health app, raised $200 million

• Rapido, a taxi ride-booking app, raised $120 million

• AIRNA, an RNA editing company, raised $60 million

• Rhombus, a physical security startup, raised $45 million

• Finaloop, an e-commerce accounting platform, raised $35 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{BOOK OF THE DAY}

When: The Scientific Secrets of Perfect Timing

Everyone knows that timing is everything. But we don't know much about timing itself. Our lives are a never-ending stream of "when" decisions: when to start a business, schedule a class, get serious about a person. Yet we make those decisions based on intuition and guesswork.

Drawing on a rich trove of research from psychology, biology, and economics, Pink reveals how best to live, work, and succeed. How can we use the hidden patterns of the day to build the ideal schedule? Why do certain breaks dramatically improve student test scores? How can we turn a stumbling beginning into a fresh start? Why should we avoid going to the hospital in the afternoon? Why is singing in time with other people as good for you as exercise? And what is the ideal time to quit a job, switch careers, or get married?

In When, Pink distills cutting-edge research and data on timing and synthesizes them into a fascinating, readable narrative packed with irresistible stories and practical takeaways that give readers compelling insights into how we can live richer, more engaged lives.

“The longer it takes for a boss to respond to their e-mails, the less satisfied people are with their leader.”

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Share of Energy Coming From Renewables

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Are You Overpaying Your Financial Advisor?

Ah, summer. Time for barbecues, beach vacays, and oh yea–your financial advisor taking their quarterly fees. 

It's the perfect time to ask: How much are you really being charged? Are hidden fees gouging your returns?

• Passive fund fees average 0.11%–what do you pay?

• Management fees range from 0.80% to 1%–are you overpaying?

• Red flag report: Is your advisor a true fiduciary, or just a registered broker?

With Rainbook, you can answer these questions in just a few clicks. Even better, it offers ongoing monitoring at no cost to keep tabs on your advisor’s performance.

Find out if your advisor is a fiduciary at Rainbook.

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McDonald’s Theory

“I use a trick with co-workers when we’re trying to decide where to eat for lunch and no one has any ideas. I recommend McDonald’s.

An interesting thing happens. Everyone unanimously agrees that we can’t possibly go to McDonald’s, and better lunch suggestions emerge. Magic!

The same goes for groups of people at work. The next time a project is being discussed in its early stages, grab a marker, go to the board, and throw something up there. The idea will probably be stupid, but that’s good! McDonald’s Theory teaches us that it will trigger the group into action.”

Source: Jon Bell

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Short Squeez Picks

• How to be seen as an emerging leader

• Habits of successful people who keep moving forward in life

• Is Zyn going to kill you and the boys?

• How to design a life that gives you freedom

• Four ways to be a more successful leader

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Memes of the Day