Equity Monday: All that VC dry powder is damper than you think

Equity

TechCrunch

News, Business, Entrepreneurship, Business News, Technology

4.2 • 372 Ratings

🗓️ 23 January 2023

⏱️ 12 minutes

🔗️ Recording | iTunes | RSS

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Summary

Here's what Natasha got into now that she's back in The Bay: Big tech: Real quick, you should know that Elliott Management took a multi-billion stake in Salesforce, while Thoma Bravo scooped up a digital forensics company for $1.34 billion. Beyond that, the big tech news this week is Microsoft's multi-billion dollar, multi-year investment in Open AI. The extended partnership comes with lots of resources, quirks and legal headaches. Big idea: we're still thinking about this Anna Heim analysis, "The mirage of dry powder." Natasha talks about wet capital and failed capital calls, as to contextualize (not shut down!) some of the optimism in the market right now. (Use code "EQUITY" for 50% an annual TC+ membership). Big innovation (or in this case, reductions): Google's in-house incubator, Area 120, was severely impacted by Alphabet layoffs and Spotify cut 6% of staff, two layoff stories that had us thinking all about the fact that tech seems to have forgotten its umbrella. We end with tongue-twister note on Quordle, which just got scooped up by Merriam-Webster. As always, you can support Natasha by following her on Twitter and Instagram. The show also tweets from @equitypod, so follow us there! Equity drops at 10:00 a.m. PT every Monday and at 7:00 a.m. PT on Wednesdays and Fridays, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. TechCrunch also has a great show on crypto, a show that interviews founders, one that details how our stories come together, and more! Credits: Equity is produced by Theresa Loconsolo with editing by Kell. Bryce Durbin is our Illustrator. We'd also like to thank the audience development team and Henry Pickavet, who manages TechCrunch audio products. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Hello and welcome back to Equity, the Tech Crunch Podcast, where we unpack the
0:14.3	numbers and nuance behind the headlines. I'm Natasha Masquerainis and it is
0:17.9	Monday, January 23, 2023. I am back in San Francisco after five weeks of traveling around the East Coast and seeing almost everyone I love including Alex, his new baby, and a ton of friends from college and home.
0:31.5	So I am rejuvenated, but I am also super happy
0:34.1	to be back in my favorite city.
0:36.2	It truly feels like home.
0:37.2	Let's jump into the show.
0:38.7	All right, let's get right into big tech.
0:43.7	I have two quick hits before we jump into the big deal,
0:46.2	and if you get it right, I'm going to give you a brownie point
0:48.8	at the end of this section.
0:49.9	But first, we hear that Elliot Management,
0:52.2	which is an activist investor, has taken a multi-billion
0:55.3	dollar stake in sales force. For background, Elliot is the kind of investor that usually takes
1:00.3	stakes in companies that it wants to make a lot of changes in, all with the
1:03.7	goal of increasing shareholder value, which is a fancy way to say it's going to try and
1:08.2	cut a lot of costs. At least it has in the past, and we do know that Salesforce had a pretty rocky end to 2022 with its executive
1:15.8	shakeups.
1:16.8	So definitely more to come there and not surprising.
1:19.3	Speaking of billions, more positive news is from Tama Bravo, which is a private equity in growth
1:24.9	capital firm, it acquired magnet forensics for 1.34 billion. The Waterloo
1:30.5	based company is making software used by Defense Forces, which is quite vague, but we do know businesses use it to investigate cyber security threats, which is quite great, I think.
	...

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