Good Morning! OpenAI officially closed on one of the largest VC rounds of all time - a $6.6 billion in funding at a $157 billion valuation. Meanwhile, the Miami Dolphins are poised to become the first NFL team to sell a stake to private equity. Tesla deliveries disappointed last quarter, and Miami workers are surprisingly back in the office. Election betting was cleared by a U.S. appeals court, with Kalshi’s presidential market expected to go live today. Plus, why it’s paying a lot less to change jobs these days, and the U.S. stock market now makes up 50% of the world market cap.

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_{SQUEEZ OF THE DAY}

WeWork_v2

It’s 2024 and we’re still talking about Adam Adam Neumann. The infamous WeWork founder, who pocketed $1.7 billion before the company’s downfall, is re-entering the arena with what he claims is a new mindset. After a failed attempt to buy back WeWork earlier this year, Neumann didn’t give up… he's launched a direct competitor called Workflow, and this time, he says he’s learned his lesson.

Workflow wants to become the ‘zen-like’ alternative to WeWork. Neumann is going for more of a calm vibe, replacing ping-pong tables and kombucha-on-tap from WeWork with fancy artwork and plush furniture.

There’s no doubt Neumann had a great idea with WeWork. But he definitely stumbled a little with his crazy parties, community-adjusted EBITDA and hotboxing his private jet. So Workflow is really his one shot at a redo. 

This time Neumann is targeting corporate tenants, and Workflow will operate out of residential buildings Neumann already owns. WeWork ran into issues when they locked in long-term leases and rented to short-term tenants. However, Workflow is targeting a more well-rounded business model, where customers can both live and work at the locations. 

They’ve opened “community-first” buildings in Miami, Atlanta, and Nashville where residents can both live and dabble in amenities like yoga and coworking.

Neumann says he’s listening to advice from venture capital legends Marc Andreessen and Ben Horowitz, especially when they told him not to bet on interest rates. And he insists Workflow’s growth will be more sustainable than the hyper-speed of WeWork.

Takeaway: Neumann is back and doing things slightly differently: “I know my priorities because of what I went through. It taught me so many things. But one of them was ‘Slow down.’ The other one was ‘Listen,’ and not just listen to what you want to hear—listen to what you don’t want to hear.”

Adam Neumann was always good with words but only time will tell if he has truly learned his lesson.

_{PRESENTED BY SIDEBAR}

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_HEADLINES

Top Reads

• OpenAI gets $6.6 billion in new funding, valuing company at $157 billion valuation (CNBC)

• Miami Dolphins owner nears selling stakes to Ares (YF)

• Tesla’s Q3 deliveries fall short (YF)

• Why Miami workers are back in the office (Vox)

• Bank of America says widespread outage is nearly fixed (CNN)

• 10 years after leaving Carlyle, Churchill’s founders have created a $50B business (Fortune)

• Mandatory composting begins for 5 NYC boroughs (NYP)

• McKinsey weighs asking staffers to come to office more often (BB)

• Election market: Who will win the U.S. Presidency (Kalshi)

• It’s paying a lot less to change jobs these days (YF)

_{CAPITAL PULSE}

Markets Rundown

Market Commentary

Wednesday’s market started with nerves but gained some ground as the day went on. All eyes were on the Middle East, as traders waited to see how Israel might respond to Iranian missile strikes. Oil prices jumped early on, but cooled off, leaving WTI crude with a modest bump, while stocks clawed their way back from the morning dip.

In the stock world, Tech and Energy were the day’s heroes, lifting the market out of its slump, while consumer staples dragged things down like a shopping cart with a broken wheel. Despite the gloom in certain sectors, investors didn’t panic, as the Fear and Greed Index stayed comfortably in the “Greed” zone.

On the jobs front, there was a bit of good news: the U.S. added more jobs than expected in September, showing the economy is still holding up. But gold, usually the go-to safety net, took a breather as profit-takers cashed in, and the U.S. dollar flexed its muscles.

All in all, the market ended on a cautious but steady note, with everyone watching to see what’s next in the geopolitical chess match.

Movers & Shakers

• (+) StandardAero ($SARO) +36% after the enterprise software company made a big bet on crypto.

• (–) Tesla ($TSLA) -3% after the EV maker missed on deliveries.

• (–) Humana ($HUM) -12% after the insurer’s Medicare ratings plummet.

Private Dealmaking

• Bain Capital bought T-Gaia, a Japanese smartphone retailer, for $980 million

• Toyota invested $500 million into Joby Aviation 

• Impulse Space, an orbital vehicle developer, raised $150 million

• 11x AI, an AI sales rep developer, raised $50 million

• Nym, a medical coding startup, raised $47 million

• Series Entertainment, a game studio startup, raised $28 million

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

_{BOOK OF THE DAY}

Private Equity Deals

Over the past 20 years, the private equity industry went from a cottage industry to a powerful juggernaut that touches every corner of the global economy. Totalling $5 trillion of investments, private equity constitutes an important investment allocation for public and corporate pension funds, university endowments, non-profit foundations, hospitals, insurance companies, families, and sovereign wealth funds worldwide.

There’s no more important sector of institutional portfolios or the global economy to understand than private equity. Private equity owned businesses are everywhere around us and touch every aspect of our daily lives.

In Private Equity Deals, Ted Seides gives you an insight to the conversations that typically happen behind the closed doors of institutional investors and private equity managers. Through a series of case studies across different types of private equity transactions, Private Equity Deals shares the dynamics of deal making, companies, and ownership that make private equity a force in the world.

“An inside view of how the industry operates.”

_{DAILY VISUAL}

US Dominance Continues

_{PRESENTED BY HEBBIA}

Analysts: If You’re Still Diligencing By Hand, Read This

Andreessen Horowitz, Index Ventures, Google Ventures, and Peter Thiel just plugged $130 million into Hebbia (you know, the AI taking Wall Street by storm). 

Why? 

• Used by a third of the top 50 asset managers globally

• Saves hours of work per day on diligencing, screening, memo writing

• Understands, PDFs, emails, docs, and more of ~unlimited~ length

• Drafts one-pagers based on your team’s investment philosophy

Book a quick demo to see Hebbia in action.

_{DAILY ACUMEN}

The Baader-Meinhof Phenomenon

Also known as frequency illusion, this cognitive bias occurs when something you've just learned suddenly seems to appear everywhere.

It's not that the frequency has increased, but your awareness has.

This phenomenon highlights how our selective attention works and can influence our perception of trends or patterns.

Understanding it helps us recognize when our newfound awareness might be skewing our perception of frequency.

_{ENLIGHTENMENT}

Short Squeez Picks

• 6 warning signs to spot bad leadership

• Phrases smart people use to succeed at work

• 5 strategies for execs to master work-life balance and thrive

• Why managing people is so hard

• Is the Oura Ring or Whoop better?

_{MEME-A-PALOOZA}

Memes of the Day