🍋 Free Credit

Why are private equity megafunds working for free on private credit transactions, plus McDonalds and Krispy Kreme partnership.

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“Nearly all the great fortunes acquired by entrepreneurs arose because they had nothing to lose.” — Felix Dennis

Good Morning! You’ll be able to buy Krispy Kreme donuts at McDonald’s, with a national rollout coming by 2026. Citi says they’ve completed their reorganization - so hopefully layoffs are in their rearview mirror. But Canada Goose will cut 17% of its corporate workforce - and it can’t be a coincidence more of Wall Street is wearing Moncler. Hedge funds are ditching U.S. stocks, and investment bankers are getting to work on a $660 billion M&A revival.

Looking for exposure to the fast moving world of AI? Invest in the supercomputers powering AI with NVIDIA elite partner, NexGen Cloud. Download the strategy brief to learn more.

SQUEEZ OF THE DAY

Free Credit

The private credit industry is becoming more cutthroat than ever. And even the big guns like Apollo are starting to roll out the red carpet with 'no-fee' deals to keep their investors happy. It’s a big pendulum swing from charging exorbitant fees to basically agreeing to work for free.

According to a new report, Apollo will reportedly manage the assets of Mubadala, the UAE’s private wealth fund, for $0 through its BDC. For one year, they're waving goodbye to management and incentive fees, and in the following year, they're only taking half their usual cut. 

It’s a big change for the private credit industry. The fee structure in private credit has been untouchable over the past few years. But now, investors have leverage and are reclaiming their share of the pie, fueled by the cash waterfall from central bank rate hikes.

KKR and Carlyle are already returning carry to investors, signaling that these alpha funds might not have as much leverage as previously thought. And other firms are trimming their management fees to keep clients happy.   

Fundraising is also looking bleak, these funds are in customer retention mode and are trying everything to keep investors on board. The global pool for private debt funds hit a four-year low at $190 billion in 2023.

Takeaway: The private credit market has been booming lately, ballooning to $1.7 trillion from a modest $500 billion back in 2015. But in 2024, there’s just more competition. Investors find themselves with more funds to pick from, but with less capital to deploy. While the mega funds are still hogging the stage and landing the biggest deals, the private credit market is pulling out all the stops to keep the capital flowing and the investors happy.

PRESENTED BY NEXGEN CLOUD

NVIDIA Elite Partner Introduces — Supercomputers as an Asset Class

A new bull market is here, and here’s one AI asset class to buy and hold forever. Last year, NVIDIA swam in profits thanks to their GPUs serving as the backbone for AI.

This year, it’s time for you to share those profits. NexGen Cloud, an Elite NVIDIA partner, is giving investors the opportunity to directly invest in the heart of AI. 

You can now own and profit from the supercomputers driving AI and large language models.

The company is projecting 30-50% annualized returns and other impressive fundamentals:

  • Targeting 150% profit over 5 years 

  • Uncapped ROI 

  • Income-producing hands-off asset 

  • Early mover advantage with a deep NVIDIA partnership .

HEADLINES

Top Reads

  • McDonald’s to sell Krispy Kreme donuts nationwide by end of 2026 (CNBC)

  • Citi has completed its reorganization (Reuters)

  • Canada Goose to cut 17% of its corporate workforce (CNBC)

  • Hedge funds flock to Europe, ditch U.S. stocks (Reuters)

  • Megadeals make a comeback to power $660 billion M&A revival (BB)

  • Andreessen backs startup to fix faxes in healthcare (Axios)

  • How quiet luxury is changing how the rich travel (CNBC)

  • NFL owners push off vote allowing private equity ownership (BB)

  • Canva strikes biggest acquisition yet in race to take on Adobe (YF)

  • Cocoa prices hit $10k per metric ton for first time ever (CNBC)

CAPITAL PULSE

Markets Rundown

Stocks closed lower for the 3rd-straight session as its rally loses steam.

Movers & Shakers

  • (+) Krispy Kreme ($DNUT) +39% after the donut chain entered a national partnership with McDonalds.

  • (+) Viking Therapeutics ($VKTX) 17% after the company posted promising weight loss drug results.

  • (–) Canada Goose ($GOOS) -7% after a string of corporate layoffs.

Private Dealmaking

  • Nuvation Bio acquired AnHeart Therapeutics, a precision cancer medicines developer, for $544 million 

  • Cyera, a cloud data security startup, is raising up to $300 million

  • Avenzo Therapeutics, a cancer drug developer, raised $150 million 

  • Succinct, a zero-knowledge proof tools developer, raised $55 million

  • oG Labs, a web3 infrastructure startup, raised $35 million

  • Espresso Systems, a blockchain startup, raised $28 million

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

BOOK OF THE DAY

The Tools

The Tools offers a solution to the biggest complaint patients have about therapy: the interminable wait for change to begin.

The traditional therapeutic model sets its sights on the past, but psychiatrist Phil Stutz and psychotherapist Barry Michels employ an arsenal of techniques—“the tools”—that allow patients to use their problems as levers that access the power of the unconscious and propel them into action.

Suddenly, through this transformative approach, obstacles become new chances—to find courage, embrace discipline, develop self-expression, deepen creativity.

A dynamic, results-oriented practice, The Tools aims to deliver relief from persistent problems and restore control and hope right away. Every day presents challenges—big and small—that the tools transform into opportunities to bring about bold and dramatic change in your life.

“These tools are emotional game changers. They do nothing less than deliver you to your best and most powerful self.”

DAILY VISUAL

Trend Wage is Sticky Around 5%

Source: Apollo

DAILY ACUMEN

Calm

When faced with a day that's spiraling out of control, there are effective steps to help steer it back on track.

Start by calming your body's stress response through deep breathing or a walk outdoors.

Next, boost your mood by engaging in activities like exercise or affectionate contact, which release feel-good hormones.

Once calmer, prioritize tasks to regain control. Delegate when possible and focus on what you can change.

Ending the day with restorative activities tailored to your needs—be it physical rest or social connection—will help reset for the next day.

With these strategies, you can navigate through rough patches more smoothly and set yourself up for future success.

ENLIGHTENMENT

Short Squeez Picks

MEME-A-PALOOZA

Memes of the Day

 

 

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