“Change is not a threat, it’s an opportunity. Survival is not the goal, transformative success is." — Stephen Schwarzman
Good Morning! With banker bonuses down again this year, there’s some hope with private equity dividend recaps making a comeback to their highest level since November 2021. Amazon and iRobot abandoned their deal after a roadblock with regulators. And Evergrande, the poster child of China’s property woes, is heading to liquidation. Plus the three types of people who try and steal your money, and seven simple steps to strategize your life.
SQUEEZ OF THE DAY
AI’s New Landlord
Don’t let the cringy holiday video distract you - Blackstone is building a data center empire. Data centers are essentially the storage facilities for your data residing in the "cloud."
Blackstone made a $10 billion bet on the niche, obscure industry in 2021 when the firm bought data center operator QTS Realty Trust. And some execs at the private equity firm say it could already be its greatest investment ever. Blackstone’s stake is already valued at $25 billion.
The generative AI boom gave some visibility to the otherwise boring, under-the-radar data center industry.
Demand for data has shot through the roof, and we don’t have enough computing power to meet the demand. Leasing rates for some data centers have doubled to as high as $150 per kilowatt, from $70 to $80 per kilowatt three years ago.
Blackstone’s President says the players with land and capital will be at an advantage. And right now, Blackstone-backed QTS is building several data centers across the country. Once complete, QTS says they’ll be equipped to provide the electric equivalent of powering 5 million homes.
But Blackstone and QTS are having a tough time winning approvals. It turns out some communities in areas like Virginia and Arizona don’t want a data center in their backyard.
Takeaway: Blackstone's data center play is a classic move. And it looks like the private equity firm was several years ahead of the generative AI boom. Blackstone could provide solutions for AI’s demand for both energy and infrastructure. But not everyone loves private equity and wants them to build data centers in their communities. Yet, if there’s any one that can navigate through legal challenges, it’s probably the largest private equity firm in the world.
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Banker bonuses are down again - but it stings this time (WSJ)
Private equity dividend recaps are back in sign of investor optimism (Axios)
Activists are eyeing tech stocks ahead of expected M&A rebound (CNBC)
Amazon, iRobot abandon merger in face of EU opposition (Reuters)
Top Goldman executive Jim Esposito to retire (YF)
Remote workers are 30% more likely to get laid off (WSJ)
Evergrande, symbol of China’s property crisis, heads to liquidation (CNN)
Private equity is starting to share with workers (NYT)
Private fund lobbyists get set for high-stakes SEC court fight (WSJ)
Investors suggest Reddit aim for $5 billion valuation ahead of IPO (Fox)
The S&P 500 closed to a fresh record as Big Tech earnings loom.
(+) SoFi Technologies ($SOFI) +20% after the fintech firm posted its first-ever quarterly profit.
(+) Beam Therapeutics ($BEAM) +16% after JPMorgan upgraded the biotech company.
(–) iRobot ($IRBT) -9% after Amazon terminated its acquisition of the company.
Willscot Mobile Mini bought McGrath RentCorp, a portable building company, for $3 billion
Bluewhite, a tractor-driving robots developer, raised $39 million
Lightship, an electric RV maker, raised $34 million
Soly, a Dutch solar energy provider, raised $33 million
Disco Pharmaceuticals, a biotech focused on lung cancer, raised $22 million
Xyte, a servitization platform for device manufacturers, raised $20 million
For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.
BOOK OF THE DAY
Too often, accomplishment does not equal success. We did the work but didn't get the promotion; we played hard but weren't recognized; we had the idea but didn't get the credit.
We convince ourselves that talent combined with a strong work ethic is the key to getting ahead, but also realize that combination often fails to yield results, without any deeper understanding as to why.
Recognizing this striking disconnect, the author, along with a team of renowned researchers and some of the most advanced data-crunching systems on the planet, dedicated themselves to one goal: uncovering that ever-elusive link between performance and success.
Now, based on years of academic research, The Formula finally unveils the groundbreaking discoveries of their pioneering study.
"Barabasi will indelibly transform the way we all think about success."
German Home Prices Declining Sharply
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Temptation bundling, pioneered by Professor Katherine Milkman, offers a powerful solution to procrastination by pairing instantly gratifying activities with beneficial but delayed-reward tasks.
In a study on exercise and audiobooks, participants practicing temptation bundling showed a remarkable 51% increase in gym visits compared to a control group.
This strategy extends beyond exercise, allowing individuals to combine enjoyable activities, like watching TV or listening to podcasts, with less desirable tasks, transforming routine activities into opportunities for instant gratification.
By aligning 'wants' with 'shoulds' in a personalized manner, this technique not only curtails procrastination but also enhances long-term efficiency, contributing to improved mental and physical well-being.
Short Squeez Picks
Memes of the Day