Good Morning! American Eagle surged 25% after beating earnings and crediting Sydney Sweeney for a “brand and business reset.” Wall Street bankers, meanwhile, are preparing for their busiest stretch of the year, with up to five IPOs expected to price next week.

Goldman is facing an $11.9 million claim from a former compliance manager who says he was fired after taking six months of paternity leave. Apple’s $3,500 Vision Pro is carving out unexpected niches, from pilot training to kitchen design, while Figma shares sank 14% in their first earnings report since July’s IPO.

Plus: KKR and Apollo are fueling a wave of private investment into Asia’s schools. Former Jefferies banker Przygoda has launched his own boutique advisory, Goldman is raising cash to support PE firms struggling to return capital, and the best morning routine.

Bracing for your first fund audit or tax filing? Carta’s tax ready playbook can help you stay compliant, win LP trust, and sail through tax season.

SQUEEZ OF THE DAY

The Yale Model Hits a Wall

For decades, David Swensen’s Yale endowment strategy was the gold standard for institutional investing. By steering billions into private equity and other alternatives, Yale delivered 13.1% annualized returns over his 36-year tenure and set the playbook that pensions, foundations, and rival endowments rushed to copy.

Alternatives went from the “dark corners” of the market to the centerpiece of multi-billion-dollar portfolios.

Fast forward to 2025 the Yale model is breaking down. Private equity has lagged the S&P 500 for three consecutive years, and distributions to investors are at their weakest levels since 2009.

Higher rates have frozen exits, leaving institutions stuck with paper gains while lacking the cash to put back into public markets. For investors trained to expect PE to outperform, the reversal has been painful.

Portfolio composition is shifting as a result. Average private equity allocations at large universities and foundations have already dropped to 46% as of June 30, down from 58% just two years ago.

Yale, once known for its careful diversification, has cut its bond allocation from around 10% in 2020 (Swensen’s last year) to just 4% in 2024. Hedge funds, another source of diversification, have grown less useful as many managers pile into the same handful of mega-cap tech stocks.

Liquidity stress has pushed schools into moves Swensen avoided. Harvard has already sold PE assets on the secondary market at discounts, and Yale is considering similar sales.

A recent increase in the endowment tax has only heightened the urgency to monetize holdings. Across the Ivy League, 10-year annualized returns have slipped to their lowest since 2019, underlining the limits of the model in today’s environment.

Takeaway: Swensen’s run was fueled by a 40-year decline in interest rates, which lifted valuations and made private equity’s illiquidity premium worthwhile. His successors face the opposite: higher borrowing costs, a tougher exit environment, and a $7 trillion private equity industry where alpha has narrowed and returns have become commoditized.

The unraveling of the Yale Model doesn’t just mark the end of an era, it signals a turning point toward a very different private equity future.

HEADLINES

Top Reads

• American Eagle stock surges 25% thanks to Sweeney driven sales (CNN)

• Bankers prep for the busiest U.S. IPO week of 2025 (BB)

• Goldman fights $11.9M claim from manager who won paternity-leave suit (BB)

• Apple’s Vision Pro gains traction in niche business use cases (WSJ)

• Figma's stock plunges after company's first earnings report since IPO (CNBC)

• OpenAI boosts secondary share sale to $10.3B (CNBC)

• Goldman’s top Asia banker says China stock rally has room to run (BB)

• Goldman sees lucrative lifelines as private-equity logjam eases (BB)

• Tariffs and high prices set to squeeze 2025 holiday shopping (Axios)

• CRE giant BGO says AI can spot undervalued properties as distress deepens (CNBC)

• KKR, Apollo fuel rush of private investment into Asia’s schools (BB)

• Veteran banker Przygoda launches own boutique advisory firm (BB)

• Moody’s: Europe’s private credit market is poised to catch up with the U.S. (BB)

• Watches of Switzerland shares jump on confirmed targets (WSJ)

• Walmart-backed OnePay adds wireless service (CNBC)

• Global bond selloff deepens, long-duration debt leads losses (BB)

• Amazon eliminates Prime “Share” shipping benefit (CNBC)

• Long-end Treasury yields push toward 5% amid global bond retreat (BB)

• Starbucks fall menu drives record sales as PSL season returns (Axios)

PRESENTED BY CARTA

Navigate Tax Season With Confidence

Raising your first institutional VC fund is a major milestone, but it comes with growing pains, especially when it comes to taxes and audits.

Whether you’re gearing up for your first audit or preparing your first tax filings, Carta’s end-to-end playbook for emerging VC funds can help you stay compliant, build trust with LPs, and save time.

Download it now for everything you need to know, including:

• How venture funds are taxed

• How to navigate the QSBS tax exemption 

• How to manage key tax documents like K-1s 

• How to stay prepared for audits year-round

• A rundown of important tax deadlines

• A comprehensive annual fund tax and audit checklist

CAPITAL PULSE

Markets Rundown

Market Update

• Tech led today’s rebound, with the Nasdaq outperforming after a favorable ruling in the Google antitrust case.

• Alphabet shares jumped 8.5% after being allowed to keep Chrome and its revenue-sharing deal with Apple intact, sparking a tech rally.

• Bond yields retreated, reversing part of Tuesday’s rise, after July job openings fell to a 10-month low.

• Oil prices dropped 2.7% as OPEC+ considers a production hike at its upcoming meeting.

Economic Data Highlights

• Labor market shows cooling signs: job openings fell to the lowest in nearly a year, potentially signaling reduced hiring appetite.

• 30-year Treasury yields briefly hit 5%, reflecting global pressure as long-dated yields in Europe and Japan also reached decade highs.

• Consensus for Friday’s NFP remains at +75K payrolls and a tick up in unemployment to 4.3%, which could strengthen the case for a September Fed rate cut.

Reported Earnings

• Salesforce (CRM) – Beat on EPS and revenue; AI adoption driving subscription growth and margin expansion.

• Figma (FIG) – Delivered strong enterprise seat growth; new AI design features seeing early adoption and boosting monetization.

• GitLab (GTLB) – Posted solid revenue growth and improving operating leverage; guided toward breakeven profitability next fiscal year.

Earnings Today

• Broadcom (AVGO) – Focus on AI chip revenue contribution, hyperscaler demand, and margins.

• Lululemon (LULU) – Key watch: same-store sales growth, international expansion, and inventory management.

• DocuSign (DOCU) – Investors watching enterprise adoption, e-signature volume trends, and AI-enabled contract analytics.

Movers & Shakers

• (+) Macy’s ($M) +21% after the retailer saw its sales rise the most in three years.

• (+) Alphabet ($GOOGL) +9% because a judge ruled Google won't be forced to sell Chrome.

• (–) Dollar Tree ($DLTR) -8% after tariffs dampened the retailer’s near-term outlook.

Private Dealmaking

• StepStone aims to raise $7 billion across two secondaries funds

• IQM, a quantum computing company, raised $320 million

• Treasury BV, a bitcoin treasury platform, raised $137 million

• LayerX, a back-office AI SaaS provider, raised $100 million

• Kapital, a commercial fintech, raised $86 million

• ID.me, a digital identity company, raised $65 million

• HappyRobot, an AI workforce management platform, raised $44 million

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

BOOK OF THE DAY

How to Untie a Balloon

Description:
A practical and powerful conflict-management guide from a former hostage negotiator. Using the metaphor of an overstretched balloon, Dunlap shows how unmanaged pressure can make us snap—and how to navigate high-stress situations with calm, clarity, and control. The F.I.R.S.T. Steps framework (Feelings, Interests, Relationships, Situation, Toll) provides a step-by-step roadmap to manage emotions, defuse tensions, and lead with composure.

Book Rating: 4.6 / 5

Book Length: 218 pages
Audiobook Length: Approximately 4 hours

Ideal For: Leaders, negotiators, caregivers, and anyone who wants to stay composed, grounded, and effective under pressure—without losing themselves.

“Popping under pressure isn’t a sign of weakness—it’s a call to learn how to untie your own knot.”

DAILY VISUAL

S&P 500 September Struggles

PRESENTED BY MACABACUS

Turn Messy Models Into Client-Ready Decks

TL;DR: Financial modeling errors and sloppy slides tank credibility. Macabacus gives banking & finance firms an enterprise-grade productivity tool to deliver error-free models & decks with confidence and speed.

Why It Matters

• Missed links and hard codes = delays, rework, and awkward client moments. 

• Formula errors = inaccurate models, incorrect decisions. 

• A tight workflow = tighter timelines and a safer reputation. 

What You Get

• Excel → PowerPoint linking: Seamlessly & reliably update tables, charts, and text as your models change. 

• Model Check + Tracing Tools: Surface hard codes, broken/circular refs, and bad links before they hit leadership or clients. 

• Deck Check: Enforce brand standards automatically (fonts, layouts, logos) across every slide. 

• AI Writing Assistant: Turn analysis into slide narratives that align with your brand guidelines and tone-of-voice. 

• Shared Libraries & Templates: Access firm-approved slides, templates, and a logo library for consistent, on-brand deliverables. 

The Outcome 
Ship error-free, client-ready work and spend your time on high-value analysis instead of clean-up.

DAILY ACUMEN

Narrative Premium

Markets price stories as much as numbers.

Tesla isn’t valued only on cash flows; it’s valued on a shared belief about the future.

People are valued the same way. Two employees may produce the same output, but one is seen as “strategic” while the other is “tactical”—and the market pays them differently.

Narrative premium is the gap between what you actually are and what people believe you are.

It isn’t about spin or manipulation. It’s about consistency: shaping the signals you send so that others tell the story you want amplified.

The market pays a multiple on story because stories drive expectations—and expectations drive behavior.

Craft your narrative before someone else writes it for you.

ENLIGHTENMENT

Short Squeez Picks

• Here’s the science-backed “best” morning routine

• Great leaders do 3 simple things to motivate employees

• 8 vacation spots that look great online but aren’t worth the hype

• 3 things to never say in a job interview

• Can you be truly happy without a sense of purpose?

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.

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

🔒 Short Squeez Premium – Insiders: Access exclusive content, including investment analysis, wellness features, career tools, and our full recruiting resource library. Upgrade to Premium. 

🧢 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.

🏠 Real Estate Newsletter – City Squeez: Latest news and exclusive listings for those looking to buy, rent, or invest in real estate around the world. Sign up here.

📚 Courses: Level up with our excel, modeling, and private equity courses. View offerings.