Good morning! Thoma Bravo posted the second-largest loss in PE history, a $5 billion wipeout on its 2021 investment after Medallia was handed to lenders. The Fed held rates steady in Kevin Warsh's first meeting as chair. And Clearlake raised $14.8 billion for its eighth private equity fund.

VSCO is taking on Adobe with a new app and a $500 plan for pros. A Florida stock-picker lost $50 billion by snubbing Nvidia for Adobe. And the space race is sparking a luxury hotel boom along Florida's coast.

Plus: Citigroup wants to double its share of the Nordic M&A boom, and how generosity became cringe.

The T-REX 2X Long SpaceX Daily Target ETF (SPAX) is now live, seeking 2x SpaceX's daily performance. Check it out here.

SQUEEZ OF THE DAY

Bankers Picking Teams

The IPO market is back, but the next wave is creating an awkward problem for Wall Street: bankers may have to choose teams. OpenAI and Anthropic are both preparing for potential IPOs later this year, and Goldman Sachs and Morgan Stanley are expected to play major roles in both. The catch is that the same individual bankers cannot work on both deals, so the firms are creating separate teams to make sure no sensitive information gets shared between the two AI rivals.

It’s an unusual move because competing companies rarely go public at the same time using the same top underwriters. When Uber and Lyft listed in 2019, Wall Street split the mandates across different banks: JPMorgan, Credit Suisse, and Jefferies led Lyft while Goldman, Morgan Stanley, and Bank of America led Uber. But OpenAI and Anthropic are so large, so important, and so fee-rich that Goldman and Morgan Stanley cannot exactly sit one out. Instead, they are building internal walls and asking bankers to pick a side in the AI wars.

The money explains the scramble. SpaceX’s IPO used 23 banks and generated roughly $500 million in total fees, with Goldman and Morgan Stanley reportedly earning about $100 million each. OpenAI and Anthropic could be the next mega-paydays, with both companies potentially seeking trillion-dollar valuations. For tech bankers, this is the Super Bowl, the World Cup, and bonus season walking into the same conference room.

The conflict risk is real. OpenAI is trying to catch Anthropic in enterprise customers, while Anthropic is dealing with its own political and regulatory complications. Bankers advising either company will see sensitive details on revenue growth, customer pipelines, compute costs, risk factors, and investor messaging. You probably do not want the same MD helping both companies explain why they are the defining AI platform of the decade.

Takeaway: The AI IPO boom has gotten so big that even Goldman and Morgan Stanley need separate internal camps. SpaceX proved investors will show up for a trillion-dollar future story. OpenAI and Anthropic are about to test whether the market can handle two of them at once. And somewhere inside every tech banking group, a bunch of MDs are quietly figuring out whether they are Team Sam or Team Dario.

PRESENTED BY REX SHARES

One Ticker, 2x SpaceX

SpaceX is finally public, and there's already a leveraged way to trade it. SPAX, the T-REX 2X Long SpaceX Daily Target ETF from REX Shares, is now trading on NYSE Arca.

How it works: SPAX seeks 200% of SpaceX's daily performance, before fees and expenses. Double the daily move, up or down, resetting each day. Built for active traders, not long-term holds.

SPAX is part of the T-REX lineup of daily 2X long and inverse ETFs across 40+ tickers from REX Shares and Tuttle Capital Management.

Visit rexshares.com/spax for the prospectus and risk disclosures*. Investing in SPAX is not equivalent to investing in SpaceX.

HEADLINES

Top Reads

• Medallia taken over by private credit lender group led by Blackstone (Pitchbook)

• Fed holds interest rates steady in first meeting under chair Kevin Warsh (Fox Business)

• Clearlake raises $14.8 billion for eighth private equity fund (WSJ)

• VSCO challenges Adobe with new app and a $500 plan for pros (BB)

• Snubbing Nvidia for Adobe costs Florida stock-picker $50 billion (BB)

• The space race is sparking a luxury hotel boom on Florida's coast (CNBC)

• Citigroup seeks to double share in Nordic M&A boom (BB)

• Warburg Pincus duo prepare to launch new firm (WSJ)

• Tech's next IPO wave promises a charitable windfall (WSJ)

• Why the PE firm that owns Pizza Hut sold it for half what it paid (Axios)

• SpaceX posts first losing day as stock sinks 5%, losing momentum after a multiday rally (CNBC)

• AI meme stock gains shape Gen Z's embrace of risk assets (BB)

• Amazon says it's 5 years ahead on quantum computing timeline (CNBC)

• Simpson Thacher reaps $70M in 5 years leading Carlyle fundraisings (Law.com)

• SpaceX surge is creating a unique hedging opportunity (CNBC)

• Passive investors who dodged bitcoin are now forced to own SpaceX shares — three times more volatile (CNBC)

• Cyber startup ENT raises $100 million in seed funding (WSJ)

CAPITAL PULSE

Markets Rundown

Market Update

• Markets closed lower after the Federal Reserve's June meeting, with investors reacting to a more hawkish policy outlook.

• The Fed held rates steady, but policymakers removed the projected 2026 rate cut from the dot plot.

• Treasury yields moved higher, with the 10-year yield near 4.49% and the 2-year yield rising to 4.21%.

• Oil prices rose modestly but remained in the mid-$70s, while the U.S. dollar strengthened.

Fed Watch

• The Fed kept the federal funds rate unchanged at 3.50%-3.75%.

• Policymakers raised inflation forecasts and removed their easing bias from the policy statement.

• The updated dot plot showed nine officials projecting at least one rate hike, eight expecting no change, and one projecting a rate cut.

• The Fed also lowered its near-term growth outlook while upgrading its labor-market assessment.

Economic Data Highlights

• Retail sales increased 0.9% in May, above expectations for a 0.6% gain.

• Higher gasoline prices contributed to the increase, with gas station sales rising 3.4% month-over-month.

• Core retail sales measures that feed directly into GDP also posted solid gains.

• The report indicated continued strength in consumer spending despite weak sentiment readings.

Movers & Shakers

• (+) La-Z-Boy ($LZB) +15% after crushing Q4 estimates as operating profit surged 40% on margin expansion.

  (+) Robinhood ($HOOD) +9% because the company laid off 10% of its workforce, prompting analyst reratings.

  (–) SpaceX ($SPCX) -5% after pulling back from Monday’s intraday high of $225 because IPO hype faded.

Prediction Markets

• The fees are raining down this IPO season. Who is left lead here?

• Trade on real-world events with Kalshi. Use code OWS to get a $10 bonus when you trade $10.

Private Dealmaking

• CuspAI, a U.K. AI startup focused on material sciences, raised $400 million

• Odyssey, a developer of world models, raised $310 million

• Ent, a workspace security startup, raised $100 million

• Triveni Bio, a developer of antibody treatments for immunological and inflammatory disorders, raised $65 million

• FirstClub, an Indian quick commerce startup, raised $55 million

• Adaptive Innovations, a home health care agency, raised $50 million

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

BOOK OF THE DAY

Fool’s Gold

Description:
A candid look into the realities of startup investing from Henry Fiorillo that challenges the glamour often associated with venture capital and angel investing. Through stories, lessons, and hard-earned experience, the book explores why even smart investors lose money, how portfolio thinking works, and what separates disciplined investing from speculation. Rather than focusing on the rare unicorn success stories, it highlights the failures, biases, and risks that define the startup investment landscape.

Book Length: 288 pages
Release Date: April 29, 2025

Ideal For:
Angel investors, entrepreneurs, venture capital enthusiasts, and anyone interested in understanding the realities of startup investing and risk management.

The secret to successful angel investing is not avoiding losses, it is surviving enough of them to find the few winners that matter most.

DAILY VISUAL

Yum Sells Struggling Pizza Hut for $2.7B

PRESENTED BY PRIMER

How to Equip Yourself for the Three Trillion Dollar IPOs

With three trillion dollar companies IPO’ing in the next several months (SpaceX last week!) and a flood of headlines, investment-grade tools are becoming essential for the everyday investor. Very few people can - and have time to - read an S-1 (we did a deep dive here), but now you don’t have to.

Primer, an institutional AI platform for hedge funds, has just launched that same platform for retail. It can read filings, build a model, and compose detailed analyses for any public, or soon-to-be public, company. In analyst modeling tests, it scores nearly twice as well as any other AI model. Conduct institutional-level analysis on SpaceX, Anthropic, OpenAI, or any other company in your portfolio to find what is real and what is noise.

For a limited time, get your own hedge fund analyst for a free week.

Try Primer today.

DAILY ACUMEN

Local Maximum

You can climb to the very top of a small hill and be genuinely stuck, because every direction from the summit leads downhill, and the only way to reach a higher peak is to first climb down and cross the valley between them. In the language of optimization, this is a local maximum, and it traps more capable people than failure ever does.

The danger is that being at the top of your small hill feels like success. The good-enough job, the comfortable city, the competent-but-uninspiring relationship. Nothing is wrong, which is exactly what makes it so hard to leave. Improvement requires a period of deliberately being worse.

Most people will not descend a hill they have already climbed. So they spend their lives on a respectable summit, looking across at taller mountains, unwilling to pay the temporary cost of the valley that separates them.

ENLIGHTENMENT

Short Squeez Picks

• How to build stronger, more supportive relationships at work

• The founder who sends the same 10-word text every week

• 12 WFH essentials for maximum productivity

• How generosity became cringe

• The psychology of confidence

• The finance bro’s focus tool**

MEME-A-PALOOZA

Memes of the Day

📣 Partner With Us: Get in front of an audience of over 1 million finance professionals, business leaders, and policy influencers. Submit a partnership inquiry.

📊 Wall Street Comp & Culture Data: Get the most detailed comp, carry, and culture insights across 800+ Wall Street firms. Explore the data.

📈 Grow With Us: Work directly with the Overheard on Wall Street team to scale your finance brand. Schedule your free consult.

🧢 Wall Street Shop: Explore our collection of finance-themed apparel and merchandise. Visit the shop.

📬 Deals Newsletter – Buysiders: A curated roundup of major M&A, private equity, and VC activity. Plus access to private deal flow. Subscribe here.