🍋 Consultants Down Bad

Consulting firms are facing tough times ahead as the pandemic and economic uncertainty have put a damper on the once-booming industry. McKinsey and KPMG are just two of the firms feeling the pinch with job cuts and a decrease in demand for their services. The days of big spending and record fees may be coming to an end as clients tighten their belts and face the threat of inflation.

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“There shouldn’t be a work-life balance. There should just be one consistent hobby.” — Christian Angermayer

Good Morning! Twitter allegedly laid off another 200 workers - the company now has less than 2,000 employees, down from 7,500 when Elon Musk took over. Rents are falling across the country, and according to recent data, those who signed new leases in January spent 3.5% less compared to rates last August.

Snapchat announced a partnership with ChatGPT. Economists are delaying when they think the onset of a recession will be. Most economists now think it will be in either the summer or fall. And looks like even the Tooth Fairy is feeling the squeeze of inflation! Kids are raking in a record $6.23 for a single lost tooth, up from last year's $5.36.

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1. Story of the Day: Consultants Down Bad

Consulting firms are facing tough times ahead as the pandemic and economic uncertainty have put a damper on the once-booming industry. McKinsey and KPMG are just two of the firms feeling the pinch with job cuts and a decrease in demand for their services. The days of big spending and record fees may be coming to an end as clients tighten their belts and face the threat of inflation.

The pandemic saw a rush to digitize operations, and consultants were the answer to companies' prayers. However, as the frenzy dies down and borrowing costs rise, the outlook for the consultancy sector is looking uncertain. The party may be over for high-flying consultants who once commanded hefty fees, with deal activity slowing down.

Firms like McKinsey are accustomed to high turnover rates. But a sluggish economy has led to fewer exit opportunities for their staff, and firms are starting to reevaluate their recruiting methods. Start-ups are finding it harder to lure talent away from consulting firms due to an increasingly competitive funding environment.

Takeaway: McKinsey says they only laid off non-client facing, back-office roles. But watch out for consulting firms to get more aggressive with their notorious ‘up-or-out’ policies - even if they don’t want to call them layoffs.

2. Markets Rundown

Stocks closed higher yesterday, following their worst week of 2023.

Movers & Shakers

  • (+) Fisker Inc. ($FSR) +30% after the EV maker announced it will ramp up production.

  • (+) Seagen ($SGEN) +10% after Pfizer is reportedly in discussions to buy the drug maker.

  • (+) Union Pacific ($UNP) +9% because the CEO announced he will step down after a push from activist investors.

Private Dealmaking

  • Pfizer considering acquiring biotech company Seagen for over $30 billion

  • Skydio, a California-based drone manufacturer, raised $230 million

  • Typeface, a generative AI startup, raised $65 million

  • Transcend Therapeutics, a neuropsychiatric diseases drug development company, raised $40 million

  • Slync, a logistics software company, raised $24 million

  • Unyoked, an Australian startup that sells vacation rentals, raised $19 million

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3. Top Reads

  • Salesforce and Marc Benioff face a defining moment (YF)

  • Why investors are so fond of stock buybacks (Axios)

  • Inflation still has corporate America concerned (YF)

  • Why Goldman’s consumer ambitions failed (CNBC)

  • Canada bans TikTok on government devices (BBC)

  • Apartment rents fall as crush of new supply hits market (WSJ)

  • TD Bank pays $1.2 billion to settle Stanford Financial Ponzi case (NYT)

  • Capital spending rebounded in January (Axios)

  • 3 things to watch on Tesla investor day (YF)

4. Book of the Day: Lean In

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6. Daily Visual: New US Home Sales

Source: Axios

7. Daily Acumen: Elevated Standards

Having elevated standards is crucial for achieving exceptional results in all areas of life.

When you challenge yourself to exceed expectations, you become more focused, efficient, and produce high-quality work.

Elevated standards not only inspire you to excel but also encourage others to do the same, creating a culture of excellence.

Conversely, accepting substandard work creates mediocrity and hinders progress.

Therefore, it's important to maintain high standards through continuous learning, reflection, and commitment to excellence, leading to a sense of accomplishment, personal growth, and success.

8. Job Board

9. Memes of the Day

 

 

 

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