TheChek News Flow

US group has sought to broaden its appeal to a mass audience

Discord is in early talks with banks about a public listing, according to people familiar with the matter, in a sign of a possible revival in the sluggish US IPO market.

Founded in 2015 by video game developer Jason Citron, Discord offers multi-person voice, video and text-based spaces to its 200mn global monthly active users.

The San Francisco gaming chat platform was considering listing as early as 2021, according to people familiar with the matter. However, many technology companies and investors have put their IPO plans on hold due to political and market uncertainty.

That is expected to change this year as interest rates have fallen and US President Donald Trump has laid out a more tech-friendly regulatory agenda.

Discord was last valued at about $15bn in a 2021 fundraising, according to PitchBook. The company’s revived IPO plans remain subject to change, one of the people said.

“We understand there is a lot of interest around Discord’s future plans, but we do not comment on rumours or speculation,” the company said in a statement shared with the Financial Times. “Our focus remains on delivering the best possible experience for our users and building a strong, sustainable business.”

CoreWeave, an artificial intelligence cloud computing provider, filed for a New York IPO this month that would raise about $4bn and value the group at more than $35bn, which could make it the largest tech flotation of the year.

A series of valuable start-ups, including fintech groups Stripe and Chime and data platform Databricks, that had been forced to stay private far longer than planned are expected to reignite plans to list their shares.

Discord initially found popularity among gamers, as well as retail trading and cryptocurrency communities, but has since sought to broaden its appeal to a mass audience.

The company has largely shunned advertising, in contrast to larger rivals such as Meta, X and Reddit, in favour of offering its users premium features for a fee.

In 2021, it attracted interest from multiple Big Tech groups, rebuffing a $12bn takeover bid from Microsoft. The recent IPO plans were first reported by The New York Times.

Decision to abandon listing reflects continued weakness in IPO market as buyers look to cash out

Multibillion-dollar market research group Kantar is set to be broken up and sold by owners Bain and WPP, shifting from a plan to pursue a stock exchange flotation of the company over worries about the weak market for public offerings.

US private equity group Bain Capital acquired 60 per cent of Kantar in 2019, giving the company a valuation of about $4bn, while the advertising group WPP retained a minority shareholding.

Bain and WPP are now seeking to cash in on their investment while facing a difficult time for initial public offerings. A person close to the process said that a sale of the businesses would be a quicker and surer way to raise money than waiting for markets to be favourable for an IPO.

In January, Kantar sold off its media division, which runs the UK’s TV audience measurement system, to private equity group HIG Capital. Kantar’s owners got about a $1bn valuation for the business, which accounted for about 15 per cent of its revenues.

While Bain and WPP had previously been weighing up an IPO for the remaining business, they are now seeking to sell its large divisions, according to people familiar with the matter.

IPO markets across the globe have struggled to rebound from a post-pandemic slump, with buyout firms and other investors forced to sit on a record number of unsold assets.

One of Europe’s biggest flotations this year — a sale of shares in hotel room wholesaler HBX Group — flopped last month, with the stock falling as much as 11 per cent. Bain and WPP had not yet finalised a venue for Kantar’s potential IPO.

Kantar’s faster growing unit Numerator, a Chicago-based consumer and market intelligence company, could be sold as soon as this year, the people said.

In January, Kantor merged Numerator, which serves the North American market research sector, with its Worldpanel division to form a new global consumer data company. 

Numerator provides first-party consumer data in the US and Canada, while Worldpanel has consumer data in 49 countries outside North America.

The new company claims to provide first-party consumer data representing almost 5bn consumers globally that can be used by brands, retailers, economists and Wall Street analysts. The combined company has 5,800 employees worldwide and now operates under the Numerator name.

Kantar has other divisions that manage panels of more than 170mn people that give opinions on areas such as marketing, and test the effectiveness of advertising campaigns.

In a lender update in January, Kantar said it had $2.5bn of adjusted gross revenues through the first nine months of 2024, a 3 per cent increase compared with the same period a year earlier. It posted $509mn of adjusted earnings before interest, taxes, depreciation and amortisation in the period.

Bain, WPP and Kantar declined to comment.

Elon Musk lost the latest battle in his lawsuit against OpenAI this week, but a federal judge appears to have given Musk — and others who oppose OpenAI’s for-profit conversion — reasons to be hopeful.

Musk’s suit against OpenAI, which also names Microsoft and OpenAI CEO Sam Altman as defendants, accuses OpenAI of abandoning its nonprofit mission to ensure its AI research benefits all humanity. OpenAI was founded as a nonprofit in 2015 but converted to a “capped-profit” structure in 2019, and now seeks to restructure once more into a public benefit corporation.

Musk had sought a preliminary injunction to halt OpenAI’s transition to a for-profit. On Tuesday, a federal judge in Northern California, U.S. District Court Judge Yvonne Gonzalez Rogers, denied Musk’s request — yet expressed some jurisprudential concerns about OpenAI’s planned conversion.

Judge Rogers said in her ruling denying the injunction that “significant and irreparable harm is incurred” when the public’s money is used to fund a nonprofit’s conversion into a for-profit. OpenAI’s nonprofit currently has a majority stake in OpenAI’s for-profit operations, and it reportedly stands to receive billions of dollars in compensation as a part of the transition.

Judge Rogers also noted that several of OpenAI’s co-founders, including Altman and president Greg Brockman, made “foundational commitments” not to use OpenAI “as a vehicle to enrich themselves.” In her ruling, Judge Rogers said that the Court is prepared to offer an expedited trial in the fall of 2025 to resolve the corporate restructuring disputes.

Marc Toberoff, a lawyer representing Musk, told TechCrunch that Musk’s legal team is pleased with the judge’s decision and intends to accept the offer for an expedited trial. OpenAI hasn’t said whether it’ll also accept and did not immediately respond to TechCrunch’s request for comment.

Judge Rogers’ comments on OpenAI’s for-profit conversion aren’t exactly good news for the company.

Tyler Whitmer, a lawyer representing Encode, a nonprofit that filed an amicus brief in the case arguing that OpenAI’s for-profit conversion could jeopardize AI safety, told TechCrunch that Judge Rogers’ decision puts a “cloud” of regulatory uncertainty over OpenAI’s board of directors. Attorneys general in California and Delaware are already investigating the transition, and the concerns Judge Rogers raised could embolden them to probe more aggressively, Whitmer said.

There were some wins for OpenAI in Judge Rogers’ ruling.

The evidence Musk’s legal team presented to show that OpenAI breached a contract in accepting around $44 million in donations from Musk, then taking steps to convert to a for-profit, was “insufficient for purposes of the high burden required for a preliminary injunction,” Judge Rogers found. In her ruling, the judge pointed out that some emails submitted as exhibits showed Musk himself considering that OpenAI might become a for-profit company someday.

Judge Rogers also said that Musk’s AI company, xAI, a plaintiff in the case, failed to demonstrate that it would suffer “irreparable harm” should OpenAI’s for-profit conversion not be enjoined. Judge Rogers was also unpersuaded by the plaintiffs’ arguments that OpenAI’s close collaborator and investor, Microsoft, would violate interlocking directorate laws and that Musk has standing under a California provision prohibiting self-dealing.

Musk, once a key supporter of OpenAI, has positioned himself as one of the company’s greatest adversaries. xAI competes directly with OpenAI in developing frontier AI models, and Musk and Altman now find themselves jockeying for legal and political power under a new presidential administration.

The stakes are high for OpenAI. The company reportedly needs to complete its for-profit conversion by 2026, or some of the capital OpenAI recently raised could convert to debt.

At least one former OpenAI employee is fearful of the implications for AI governance should OpenAI successfully complete its transition. Speaking to TechCrunch on the condition of anonymity to protect their future job prospects, the ex-employee said they believe the startup’s conversion could threaten public safety.

Part of the motivation behind OpenAI’s nonprofit structure was to ensure that profit motives don’t override its mission: ensuring AI research benefits all of humanity. However, if OpenAI becomes a traditional for-profit company, there may be little to stop it from prioritizing profit above all else, the former employee told TechCrunch.

The ex-employee added that OpenAI’s nonprofit structure was one of the main reasons they joined the organization.

Just a few months from now, it should become clearer how many hurdles OpenAI will have to overcome in its for-profit transition. Regulators, AI safety advocates, and tech investors will be watching with great interest.

Being deemed a great talent at a young age by Forbes isn't what it used to be after Forbes made various dud calls. However, it still counts for something, even if it simply facilitates your move from one big hedge fund to another.

Kendall Jager was 27 when she was elected one of Forbes' 30 under 30 special people while she was working for hedge fund Millennium. Two years later, Jager is too old for another nomination, but has possibly leveraged the first to get headhunted by Point72 in New York.

Writing on social media, Jager says she's joining Point72 as head of AI for investment services. Jager doesn't elaborate on what this will entail, but investment services at Point72 includes areas like risk, compliance and operations. Presumably she will be responsible for automating these.

Jager has a bachelors in applied mathematics and economics from Brown University. She joined Millennium in 2017 and was latterly a senior data scientist there. In 2022 Forbes described Jager as, "a critical member of the team that built the firm's [Millennium's] in-house machine learning and data science platform for the compliance department."

Bear with us if you leave a comment at the bottom of this article: all our comments are moderated by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. Eventually it will – unless it’s offensive or libellous (in which case it won’t.)

The share price of Israeli advanced driving assistance systems (ADAS) company Mobileye Global Inc (Nasdaq: MBLY) rose 5.2% on Wall Street on Friday, giving a market cap of $12.655 billion, after reports that hedge fund Point72 Asset Management holds a 5% stake in the company. However, Jerusalem-based Mobileye's share price was down 1% overall on the week.

Point72, managed by Steve Cohen, has $36.9 billion under management. The value of Point72's stake in Mobileye, managed by cofounder and CEO Prof. Amnon Shashua, is worth $78 million.

Point72's entry into Mobileye is viewed as positive. Mobileye held its Nasdaq IPO at the end of 2022 at $21 per share, after it was acquired by Intel in 2017, which still holds a controlling stake in the company. The share price more than doubled to $47 before falling back to its current price of $15.59. In 2024, the company's revenue fell 20.4% but Mobileye expects to return to growth this year.

Trade minister to pitch ‘win-win’ solutions in Washington as deadline looms for steel and aluminium duties

Japan’s trade minister is heading to Washington in a last-minute attempt to seek tariff exemptions after President Donald Trump openly questioned a long-standing security pact between the US and one of its closest allies.

Yoji Muto, minister of economy, trade and industry, is scheduled to meet his American counterpart Howard Lutnick on Monday, just two days before the US is set to impose a 25 per cent tariff on all steel and aluminium imports.

People close to the commerce secretary have described Lutnick as favouring the use of tariffs to convince foreign governments to adopt more US-friendly policies.

The trip comes after Trump on Thursday said while the US had a great relationship with Japan, “we have an interesting deal with Japan that we have to protect them, but they don’t have to protect us”.

In response, Prime Minister Shigeru Ishiba told parliament on Friday that the security treaty was reciprocal. Japan hosts more than a dozen US bases and roughly 60,000 US military personnel under a mutual defence pact signed by Republican president Dwight Eisenhower in 1960.

Ishiba is also overseeing a rapid expansion of military spending towards a target of 2 per cent of GDP.

The trade minister is expected to discuss exemptions from the metals tariffs, as well as a reprieve from a possible 25 per cent levy on car imports, which Trump threatened in February could come as soon as April.

Automobile duties would hurt Japan’s big carmakers, which directly export to the US and have complex production networks that rely on the free movement of parts between the US, Mexico and Canada. Cars were Japan’s biggest export last year, with roughly a third bound for the US.

The on-off nature of Trump’s tariff threats has triggered market volatility, with Japan’s exporter-heavy Nikkei 225 stock index falling more than 2 per cent on Friday.

As he departed Tokyo on Sunday, Muto told reporters that he would use his first meeting with Lutnick to “build human relations” and offer suggestions that were “win-win for both the US and Japanese economies”, but did not elaborate.

His visit was announced last week amid rising consternation in Japan over whether its long-standing friendship with the US would protect it from a president who has pointed to the existence of trade deficits with other countries as evidence of unfairness. 

The US trade deficit in goods with Japan was the seventh largest by country, at $68.5bn, last year, according to the US Bureau of Economic Analysis. But Japan was also the largest provider of foreign direct investment to the US in terms of ultimate beneficial owner, with $783.3bn in 2023.

Tokyo’s concerns also include accusations of currency manipulation. Trump last Monday cited Japan and China as countries that had been reducing the value of their currency in a way that was unfair to the US.

In response, former Bank of Japan governor Haruhiko Kuroda noted that the country had undertaken huge efforts last year to prop up the falling yen and that current monetary policy, which has been focused on raising interest rates, was not aimed at cheapening the yen.

“If there’s any misunderstanding on that point, it needs to be addressed,” he said on Friday in his first televised interview since stepping down as governor in April 2023.

US administration concedes some prices might rise as fears grow of trade chaos causing disruption

Donald Trump has declined to rule out either a recession or higher inflation while dismissing the concerns of business over a lack of clarity on tariffs, after a tumultuous week in which he watered down elements of his aggressive trade agenda. 

The president insisted industry had “plenty of clarity” and lashed out at “soundbite[s]” from companies expressing confusion over his plans. 

“They always say that — that’s like almost a soundbite — they always say that: ‘we want clarity’,” Trump said in an interview aired on Fox News on Sunday. 

“It sounds good to say, but for years, the globalists, the big globalists, have been ripping off the United States. They’ve been taking money away from the United States, and all we’re doing is getting some of it back.”

The president declined to rule out a recession hitting the US economy this year after the Atlanta Fed warned of an economic contraction in the first quarter of the year. 

“I hate to predict things like that. There is a period of transition, because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing, and there are always periods, it takes a little time.”

Asked whether tariffs could fuel inflation again, Trump said: “You may get it. In the meantime, guess what? Interest rates are down.”

The comments come after a week of about-turns and an equity market sell-off as markets scrambled for clarity over Trump’s brewing trade war and companies warned of rising prices.

The president imposed 25 per cent tariffs across the board on imports from Canada and Mexico on Tuesday before backtracking later in the week.

On Wednesday he granted carmakers a carve-out from the levies and on Thursday extended that to all goods that met the rules of the 2020 USMCA free-trade deal. Separate 25 per cent tariffs on steel and aluminium imports are set to take effect this week.

The levies have already caused significant upheaval in the market as companies stockpile materials, review operations and prepare to raise prices. Trump reiterated that the tariffs could rise in future.

“The tariffs could go up as time goes by. They may go up, I don’t know if it’s predictability,” he said.

Trump said in the interview that he had “wanted to help the American carmakers” this week but insisted that no such leeway would be shown on reciprocal tariffs set to be imposed next month. 

“I gave them a little bit of a break for a short period of time . . . It’s a transition into April, and after that I’m not doing this . . . I told them, I said: Look, I’m going to do it this one time but, after that, I’m not doing it.”

Separately on Sunday, Howard Lutnick, Trump’s commerce secretary, conceded some of the tariffs would cause inflationary pressures, echoing Trump’s warnings of “a little disturbance” when he addressed Congress on Tuesday.

“So, will there be distortions? Of course, foreign goods may get a little more expensive, but American goods are going to get cheaper.,” Lutnick told NBC’s meet the press.