Axios : Stripe in talks to buy back stock from investors

Stripe in talks to buy back stock from investors

Stripe is in talks to repurchase shares from venture capital backers at a $106.7 billion valuation, Axios has learned.

Why it matters: The payments infrastructure giant caught grief, including from yours truly, for not going public when its valuation hit $95 billion before the pandemic — after which it was slashed to only $50 billion.

  • Now it's worth more and is offering liquidity without public-market glare.

Behind the scenes: Stripe hasn't yet determined how much stock it will repurchase, nor if the offer will be extended to employees. A source called the talks "flexible."

  • The $106.7 billion figure is Stripe's latest 409A valuation.
  • A company spokesperson declined comment.

Flashback: One year ago, longtime Stripe investor Sequoia Capital bought $861 million worth of Stripe shares from its own limited partners at a $70 billion valuation.

The bottom line: Stripe's founding brothers have never seemed interested in an IPO, and this is further indication that there won't be one anytime soon.

The Information : In OpenAI Megadeal, Nvidia Discusses a New Business Model: Chi

In OpenAI Megadeal, Nvidia Discusses a New Business Model: Chip Leasing

The Takeaway
  • Nvidia discusses new chip leasing model for OpenAI data centers.
  • OpenAI believes leasing the chips could be 10-15% cheaper than buying them.
  • Nvidia equipment would account for $350 billion to $450 billion of the total cost of the proposed project.

OpenAI and Nvidia are discussing an unusual way to structure their new artificial intelligence data center partnership, under which OpenAI would lease Nvidia’s AI chips rather than buying them, according to two people who spoke to executives at the companies about it.

The discussion shows how Nvidia is considering new business models to sell its products to customers that are less proven and would struggle to buy the chips on their own, compared to large cloud providers like Google and Microsoft that make up a majority of the chip firm’s revenue today.

Nvidia said Monday it would provide up to $100 billion in funding to OpenAI, allowing the ChatGPT maker to build its own data centers and use Nvidia’s chips to power them.

Leasing server chips from Nvidia could ease the financial burden on OpenAI, which is already burning billions of dollars in cash a year due to high computing costs. OpenAI has estimated a leasing arrangement could lower the cost of the server chips 10% to 15% compared to buying them, according to one of the people, though it isn’t clear how that was calculated. And by renting the hardware, OpenAI wouldn’t need to raise tens of billions of dollars to purchase it outright. It also frees OpenAI from the risk the chips become outdated sooner than expected.

OpenAI already rents Nvidia chip servers from Microsoft and Oracle. It isn’t clear how the cost of a leasing arrangement with Nvidia would compare to what OpenAI is already spending on server rentals.

The leasing deal could be structured to minimize risks for Nvidia. Nvidia could set up an entity that borrows money to buy the servers, using the chips as collateral. OpenAI’s lease payments could go towards paying back the loan.

That type of deal is “the only viable path” to building enough data centers for AI, said Aaron Ginn, the CEO of Hydra, whose software helps data center firms generate revenue from Nvidia chips. He isn’t involved in the deal.

Under the terms being discussed but which could still change, OpenAI would agree to lease the Nvidia chips for roughly five years, according to one of the people who spoke to executives involved in it. That’s similar to the length of the contracts OpenAI has signed with cloud providers such as Oracle to rent large pools of Nvidia chip servers

Nvidia’s equity investment in OpenAI, which will start with a $10 billion cash infusion this year at a $500 billion valuation—giving it a roughly 2% equity stake—would also make it easier for OpenAI to pay for the servers as well as the networking equipment that connects them. But OpenAI would still need to raise several times that amount to build data center facilities to handle those chips.

Altman told reporters last month that OpenAI is working on a new way to fund its data center expansion, and he wrote in a post on Tuesday that “given how increasing compute is the literal key to increasing revenue, we have some interesting new ideas” about financing.

OpenAI isn’t the only firm that is looking for creative ways to fund the enormous cost of Nvidia hardware. In recent years, several data center operators have financed new facilities in part by using Nvidia chips as collateral for multibillion-dollar loans.

OpenAI would have likely struggled to borrow money to buy Nvidia chips on its own, as lenders would question its ability to afford them over time, given its projected cash burn of $115 billion through 2029.

Before Monday’s announcement, OpenAI had accessed Nvidia chips by signing deals to rent them from cloud providers such as Microsoft and Oracle. Over the summer, OpenAI projected spending $450 billion to rent servers from cloud providers through 2030, peaking at about 8 gigawatts of data center capacity. That’s enough to power multiple large U.S. cities. (To put this into perspective, Microsoft’s Azure cloud unit operated around 5 GW of capacity as of 2023.)

Nvidia and OpenAI said their deal could scale to 10 GW of data center capacity. Chips and networking equipment from Nvidia would account for around $350 billion to $450 billion of the total cost, which could range between $500 billion to $600 billion, according to one of the people.

In the deal they are discussing, OpenAI would select data center locations and Nvidia would serve as a type of advisor, offering feedback on engineering and design decisions. OpenAI would make the final decision and own the underlying data center, this person said.

WSJ : Peter Thiel Wants Everyone to Think More About the Antichrist

Peter Thiel Wants Everyone to Think More About the Antichrist
In a series of appearances, the billionaire investor has offered his analysis intertwining technology, government and a biblical perspective on the end of the world

Billionaire investor Peter Thiel is giving a lecture series on biblical prophecies and the potential for technology to bring about an apocalyptic future.
Thiel suggests that fearing or regulating technological progress, such as AI, could hasten the coming of the Antichrist.
He believes the Antichrist could be a charismatic individual or entity that gains power by promising to regulate existential risks from technology.

Peter Thiel, the billionaire investor in data, AI, defense and weapons development technology companies, wants everyone to think more about the end of the world.

For about a year now, Thiel has been publicly laying out his understanding of biblical prophecies and the potential for the rapid advance of technology to bring about an apocalyptic future.

In a lecture Monday, he encouraged an audience to continue working toward scientific progress, whether in AI or other forms of technology. Fearing or regulating it, or opposing technological progress, would hasten the coming of the Antichrist, Thiel said, according to people who attended.

A devout Christian, Thiel is expanding on a number of speeches and public interviews he has given about the Antichrist in a closed, four-part lecture series this month in San Francisco. The second lecture happened on Monday, and the series will end in early October.

He is among a number of Silicon Valley figures who have recently spoken more openly about their faith, a contrast to the cultural milieu of the epicenter of the tech world, which is mostly secular.

This is how Thiel says the end of the world might happen, according to a Wall Street Journal review of his recent lectures. Existential risks will present themselves in the form of nuclear war, environmental disaster, dangerously engineered bioweapons and even autonomous killer robots guided by artificial intelligence.

As humans race toward a last battle—the Armageddon—a one-world government will form, promising peace and safety. In Thiel’s reckoning, this totalitarian authoritarian regime, with real teeth and real power, will be the coming of the modern-day Antichrist, a figure defined in Christian teachings as the personal opponent of God who will appear before the world ends.

Not ‘defeatist’
The point of these talks is “not to be defeatist,” Thiel said last October in an interview series produced by the Hoover Institution. In driving people to think more about the Armageddon or the Antichrist, his hope is that human society can find a third way and avoid both outcomes. “I think the biblical language, it sounds crazier, but it’s actually more hopeful,” he said.

The AI arms race gripping Silicon Valley has prompted more spiritual reflection by many tech luminaries, including those who have called for Christian concepts to inform the advance of the technology. Pope Leo XIV has begun to speak about the threats posed by AI, even choosing his papal name in a nod to technological revolution in the past.

“In the last two years, with AI, it definitely feels like we’ve unleashed more of a high-stakes conversation on all fronts,” said Jonathan Gundlach, an ordained minister and attorney who is attending the lecture series and counts tech workers among his parishioners. “There’s a heightened sense of spirituality because it feels like we’re dealing with a new form of being that has infinite potential. It’s kind of like a God,” said Gundlach. He said Thiel occasionally attended a church where Gundlach was formerly a minister.

Former Intel Chief Executive Pat Gelsinger gave a lecture this summer about his Christianity. Garry Tan, chief executive of startup incubator Y Combinator, also has hosted fireside chats discussing how religion fits in with science and technology. Elon Musk, who has extolled the virtues of Christianity in recent public remarks, quoted from a scripture in the New Testament Sunday on X.

According to a review of his past lectures, Thiel draws on a theory that the Antichrist could be an individual or entity that is incredibly charismatic but talks repeatedly about the end of the world, thereby convincing society to give it the power needed to regulate the existential risks from science and technology.

Jay Kim, the lead pastor at WestGate Church in the Bay Area, who has had a front-row seat to the new attention to Christianity emerging in Silicon Valley, said Thiel’s focus on the Antichrist is misplaced.

“My best understanding is that the New Testament writers focus very little, if at all, on pointing followers of Jesus towards spending their energy on accurately identifying the Antichrist,” he said. “To give all your energy into thinking about all that, to me, feels like a pretty futile endeavor.”

Thiel’s speaker series is hosted by ACTS 17, a San Francisco-based nonprofit co-founded by Michelle Stephens, an executive at a healthcare software startup. Her husband is Trae Stephens, an investor at Thiel’s venture firm, Founders Fund and co-founder of Anduril Industries, one of the few privately held tech companies to land contracts with the Defense Department. The couple does Bible study with Thiel, she said.

In an interview, Michelle Stephens said she started ACTS 17 in part because of the questions she and her husband faced as practicing Christians working in tech. “Trae was building his own tech company and really facing hostility around what he was building, why he was building unmanned defense systems with Anduril,” she said.

ACTS 17, an acronym for “Acknowledging Christ in Technology and Society,” aims to create a community of Christians and non-Christians to talk about many topics, including religion and Jesus.

Stephens said she has faced questions on whether they are seemingly “tending to the rich” with ACTS 17’s work rather than giving back to the poor. She pushes back on that criticism. “Christians actually don’t do a very good job of ministering to the wealthy, who can think that they’re basically gods themselves which can be very dangerous,” she said.

A charismatic Antichrist
The twin concepts of the Armageddon and the Antichrist have been the subject of intense scrutiny and attention for generations, especially interpretations of the Book of Revelation, which includes vivid imagery as it describes the conditions that lead to a final battle between good and evil.

At one recent lecture, an audience member asked Thiel if a certain world leader was the Antichrist. Thiel said the leader wasn’t “charismatic enough,” according to Nestor Tkachenko, a startup CEO who is attending the lectures. In the past, Thiel has named certain left-leaning political figures as analogues for what the Antichrist could be.

This month’s lectures appear to build on Thiel’s two-hour interview with Peter Robinson, a former speechwriter for President Ronald Reagan and host of “Uncommon Knowledge,” a show by Stanford University’s Hoover Institution.

The two discussed Thiel’s sourcing for his theories on Armageddon and the Antichrist, which include biblical texts like the Book of Revelation and the Book of Daniel, and fictional books such as “Lord of the World,” a dystopian science-fiction novel written by a Catholic priest in 1907.

At one point in the conversation, Robinson asked Thiel why he believed in texts that much of contemporary society has ignored. “One can take it seriously without taking it completely literally,” Thiel responded.

“The Antichrist probably presents as a great humanitarian, it’s redistributive, it’s an extremely great philanthropist as an effective altruist,” Thiel said. “And these things are not simply anti-Christian, but it is always when they get overly combined with state power that something is very wrong.”

Thiel also draws heavily from theories and personal conversations with René Girard, a French historian who taught at Stanford University. For his San Francisco lecture series, Thiel has added new sources, including Renaissance paintings from the Italian artist Luca Signorelli to Japanese comic books, also known as manga, according to people in attendance.

“In some sense, the apocalyptic prophecies are just a prediction of what humans are likely to do in a world in which they have ever more powerful technologies in which there are no sacred limits on the use of these technologies,” said Thiel in past talks.

FT : Nvidia’s $100bn bet on ‘gigantic AI factories’ to power ChatGPT

Nvidia’s $100bn bet on ‘gigantic AI factories’ to power ChatGPT
Jensen Huang seeks to ensure US chipmaker stays at the heart of new tech

Even for the biggest ever public company and the most valuable start-up in history, this week’s artificial intelligence data centres deal between Nvidia and OpenAI was a blockbuster.

Nvidia, valued at $4.3tn, pledged to make the tech industry’s largest private investment into OpenAI, spending up to $100bn to fund new computing power.

As the last remaining founder-chief executive of a major tech company from before the dotcom era, Nvidia’s Jensen Huang is leveraging his commanding position in Silicon Valley like never before to ensure the AI boom endures — and his chipmaker remains at its centre.

“[$100bn] is a huge number but we are talking about a company with a market value of nearly $4.5tn,” said Michael Cusumano, professor of technological innovation and entrepreneurship at MIT’s Sloan School of Management. “That’s also unprecedented.”

It comes after a whirlwind of huge deals from Nvidia, including investing $5bn in its rival Intel last week.

Despite all the superlatives, Nvidia and OpenAI’s announcement left big uncertainties around the proposed $100bn investment.

Its unclear how quickly such huge facilities could be built and where the companies can source enough energy to run then.

OpenAI plans to lease chips from Nvidia as part of the deal, according to people with knowledge of the matter, but details of the arrangement have not been announced.

Nvidia’s decision to pump money into OpenAI to fund its need for the chipmaker’s hardware has raised concerns over the agreement’s circular structure.

Still, analysts concede Nvidia’s investment can be comfortably funded from the chipmaker’s rapidly growing cash flows — and if fully consummated the deal could drive hundreds of billions of dollars in revenue for the company.

It will also help fortify Nvidia’s position as an indispensable player in the infrastructure underpinning AI models such as OpenAI’s ChatGPT. Nvidia’s share price has surged roughly 1,000 per cent since the chatbot launched in late 2022.

However, OpenAI has recently moved to diversify its semiconductor supply chain, striking a deal with Broadcom produce custom chips.

One senior Big Tech executive said the deal highlights Nvidia’s “reliance” on OpenAI, and Huang’s desire to “head off the threat of his biggest customer building its own chip with Broadcom”.

Nvidia pushed back against any such suggestion, saying its AI infrastructure provided “an unparalleled combination of performance, versatility and value, and is available to every AI lab, cloud and enterprise”.

The relationship between Nvidia and OpenAI dates back to 2016, when Huang delivered a device he has dubbed “the first AI supercomputer the world ever made” to the AI lab when it was barely a year old.

Nine years later, Huang negotiated this week’s deal directly with Sam Altman, OpenAI’s co-founder and chief executive, said a person familiar with the matter.

The two founders worked largely without formal advice from the bankers who would normally act as intermediaries in such deals, putting the finishing touches to the agreement last week in the UK during President Donald Trump’s state visit.


The data centres — Huang has called them “AI factories” — allow OpenAI to train its AI systems and produce answers, charging customers for the output.

Huang has said that for every 1 gigawatt of AI infrastructure deployed, as much as $50bn is spent on the computing hardware, including Nvidia’s specialised processors and its own networking technology, as well as the server racks that are produced by the likes of Foxconn, HP, Dell and Super Micro.

“These are gigantic factory investments,” Huang said at an event in Taiwan in May.

Nvidia’s OpenAI deal calls for “at least” 10GW of computing power to be built, over an unspecified period. The International Energy Agency estimates 10GW of AI data centres would consume as much energy in a year as 10mn typical US households.

OpenAI said the deal is separate from the extravagant plans for Stargate, its global infrastructure project with Japan’s SoftBank and US tech group Oracle, which includes a recent $300bn contract with Oracle.

Morgan Stanley has estimated deploying 10GW of AI computing power could cost as much as $600bn, of which $350bn “potentially” goes to Nvidia.


Morgan Stanley’s analysts wrote in a note to clients: “That’s a very large number so we are not viewing this level of investment as a certainty but part of the framing of the longer-term bull case [for Nvidia stock].”

Still, the investment will only fuel the “arms race” to develop advanced AI, the analysts added. “The scale and scope of OpenAI investment is starting to dwarf all peers, but the desire to build intelligence compute remains intense.”

OpenAI on Tuesday said it has struck agreements to develop five new US data centres, pushing the cost of Stargate to about $400bn.

“Our vision is simple: we want to create a factory that can produce a gigawatt of new AI infrastructure every week,” Altman said in a blog post on Tuesday.

OpenAI is competing with Google, Meta, Elon Musk’s xAI and Anthropic in the US, as well as with Chinese rivals including DeepSeek and Alibaba.

Their infrastructure arms race continues despite persistent warning signs that the industry’s vast capital outlay is far outpacing the revenue that AI is delivering.

A report by consultancy Bain, released just hours after the Nvidia-OpenAI deal was announced, estimates AI companies need to spend $500bn on capital investment each year to meet anticipated demand by 2030.

Funding that huge outlay sustainably would require $2tn in annual revenues, Bain projected, but the industry is on pace to miss that target by some $800bn.

With such uncertainty over AI’s returns, OpenAI’s future has been clouded by questions over which groups it would get to fund its vast infrastructure projects.

Nvidia’s $100bn pledge goes some way to answering those questions, providing capital that it will receive in increments as its data centre construction progresses and making it cheaper to finance the hundreds of billions more it needs to execute on its plans.

Altman on Tuesday said he would “talk about how we are financing” OpenAI’s infrastructure ambitions “later this year”.

The deal marks a “new financing model . . . where we can pay over time, instead of buying them up front”, he added. “The chips and the systems are a humungous [percentage] of the cost and its hard to pay that upfront.”

With more than 700mn people using ChatGPT every week, OpenAI executives have said privately for months that they are already starved of the compute capacity they need to deliver such a complex product on a massive scale.

Altman is betting that “innovation is increasingly gated by access to infrastructure rather than ideas”, said Dimitri Zabelin, AI analyst at PitchBook, which tracks venture capital deals.

Huang’s move to ensure Nvidia is OpenAI’s “preferred strategic compute and networking partner”, as Monday’s announcement put it, will make it harder for AI developers to move away to rival processors.

Nvidia’s Cuda software platform, which has become the default way to write the AI software that runs on its chips, adds to the company’s grip on the industry.

The deal comes at a time when many of the chipmaker’s biggest customers — including Google, Meta, Amazon and Microsoft — are racing to develop their own custom processors as an alternative to Nvidia.

Cusumano likens Nvidia’s use of Cuda to extend its dominance to the way Microsoft and Apple gave away the tools needed to build apps for their Windows and iOS operating systems, allowing their platforms to dominate the personal computer and smartphone eras.

“The difference with Nvidia is it’s like combining Microsoft and Intel at their peak into one company,” he said. “It’s like a drug — software developers will use Nvidia’s tools and they have to use [Nvidia’s] hardware.”

Huang has continued a strategy that can be traced back directly to that first supercomputer delivery to a fledgling AI lab in 2016.

By keeping AI developers hooked on its product, Huang’s investment into OpenAI — as well as dozens of other start-ups involved in AI applications, cloud computing, robotics and healthcare — “will pay off multifold in the future for Nvidia”, Cusumano added.

FT : The Man Group malaise: can the largest listed hedge fund rebound?

The Man Group malaise: can the largest listed hedge fund rebound?
Falling share price, investor withdrawals and lacklustre performance present a strategic dilemma for London group

In May, London-based hedge fund Man Group handed its quant teams a three-month long mission: figure out what was ailing its computer-driven hedge fund unit AHL.

Shares in the world’s largest listed hedge fund had fallen 36 per cent in the past year, key strategies were in the red and wealthy individuals were pulling their money.

The conclusion? “Nothing is broken,” said one person familiar with the review.

Instead, the quants — analysts who use algorithms to identify investment opportunities — pinned the blame for three years of lacklustre performance on a “particularly unfavourable” trading environment for the type of trend-following strategy that Man is famous for.

But the collapse in its shares and the spectre of more investors pulling money from its most lucrative strategies has forced the group to confront some key strategic dilemmas: does it continue to seek out alternative revenue streams as it has for the past decade, or instead concentrate on reviving its core hedge fund performance? And will its publicly listed status allow it to do either well?

Under chief executive Robyn Grew, who came up through compliance rather than trading, and her predecessor Luke Ellis, Man has prioritised expansion in new areas. 

It has completed a string of acquisitions in the past decade or so, including Boston-based long-only specialist Numeric, real assets investor Aalto and private credit firms Varagon and Bardin Hill, with the aim of cross-selling “content” — management’s term for investment strategies.


But while it has steadily built income streams from these other businesses, they have not come close to offsetting the returns from its hedge fund business, which is struggling. 

Former employees argue Man should focus on just being a great hedge fund, investing in developing innovative strategies that will generate huge profits. 

“We have to focus all of our resources, because it’s so hard to compete” with other quant hedge funds such as Renaissance Technologies and DE Shaw, said a former senior employee. “We should just focus on what we do very well.”

The company declined to comment. 

Man Group was one of the pioneers of a style of investing that relied on large amounts of data and sophisticated mathematical models to make bets on the direction of asset prices, buying a majority stake in quantitative hedge fund business AHL in 1989.

Even with its acquisitions, AHL is the group’s profit driver. It can charge both chunky management fees, and a substantial performance fee when its strategies do well.


Man’s wider hedge fund business, which includes AHL, charges management fees that are five times higher than its long only computer-driven business. In 2022 — the last truly good year, when the group made $779mn in performance fees — at least 60 per cent of the total came from just three AHL strategies.

Trend-following strategies, however, have faltered across the industry as markets have yo-yoed. When markets turn on the whim of the US president, it is difficult to bet on clear trends in asset prices — and to make money for investors. As AHL’s trend-following strategies have struggled, the group’s performance fees have also weakened.

Last year, Man’s flagship institutional trend-following strategy, AHL Alpha, gained 3 per cent: better than the 1 per cent gain in 2023, but a result that helped garner the group just $310mn in performance fees.

So far, Alpha is down 2.4 per cent for 2025, although that is a marked improvement on the 9 per cent fall it had suffered earlier in the year. Since 2014, AHL Alpha has recorded annualised returns after fees of 4.9 per cent, comparable with US Treasury yields.

Man Evolution, another core trend strategy that trades esoteric markets, is down 5.2 per cent this year, having fallen 6.1 per cent last year.

“We fear that unless performance notably recovers, Man could see larger redemptions from institutional investors,” Citi analyst Nicholas Herman said last month, before performance started to improve.


The outsized importance of AHL’s trend following strategies to Man’s profits has made it both tougher to find revenue streams to counterbalance it and more urgent to do so.

“To truly diversify away from AHL, they need to add quite a big leg to the stool,” said another former employee. However, growth in its top multi-strategy offering, Man 1783, has been slow with just $2.5bn in assets flowing in since its launch in 2020. Jain Global, a new rival multi-manager that started trading last year, already has more than $5bn.

Recent acquisitions in private credit have also yet to pay off. Company filings show that US direct lending assets — which Man started reporting when it acquired Varagon two years ago for $183mn — have already fallen $800mn to $9.9bn, although a person familiar with the position said the group had been holding back its firepower as it focused on risk management.


Some of Man’s quant rivals have had more success. London-based Qube and Paris-headquartered CFM have had built up other quant strategies beyond trend following, for example with statistical arbitrage.

One person close to the firm said there was innovation within the hedge fund, but it was happening within Man’s more opaque solutions business, where the group bundles strategies for big investor clients. Man had been developing a strategy based on statistical arbitrage over the past two to three years, and had $1.5bn across two strategies trading Chinese assets, they added.

“What you get in return for the enormous margin [in hedge funds] is everyone wants to eat your lunch all the time,” said a former executive. “If you don’t innovate, you die.”

Revitalising its hedge fund business will entail hiring and retaining top quants and portfolio managers and making pay competitive with American rivals. Grew has already taken some action on that front, promoting Greg Bond, the head of Boston-based quant unit Numeric, in July to be the company’s chief investment officer, four years after the last CIO left.

Voluntary staff turnover across the group is the third-lowest in eight years, and the numbers in quant investment teams were at a record, a person familiar with the situation said.

But Man has also parted ways with some of its most senior investing chiefs over the past year. Jens Foehrenbach, the head of the group’s discretionary investing division in public markets, left to become co-chief investment officer of US macro hedge fund Graham Capital, while Eric Burl, head of discretionary investing for the whole group, has resigned.

Insiders privately acknowledge that Man Group cannot compete on pay with the likes of rivals such as Citadel and Millennium for key portfolio manager roles. However, they have long argued that the company makes up for a pay shortfall with a less cut-throat and more flexible work culture than some US rivals, and that team-based roles are competitive.

But that may not cut it anymore. Man earlier this year tightened non-compete terms for its traders — a tacit acknowledgment that it risks losing its talent to rivals.

Given that pay as a percentage of adjusted revenues is at the very top of the company’s range, funding better pay could entail halting expansion in non-core areas such as private credit and cutting dividends and share buybacks.


One of Man’s problems is the tension between shareholders and investors, which is inherent in its public market listing.

“Man Group has done very well on capital returns,” said Kunal Khotari, a fund manager at Aviva Investors. “The last five years they’ve bought back about 20 per cent of their shares, which is a strong record of capital allocation versus other UK asset managers.”

Man’s shares have started to pick up this month, gaining 15 per cent in two weeks as key AHL strategies have recovered some of their losses.

But the interests of shareholders are not always aligned with investors in the funds.

Shareholders have come to value a 7 per cent dividend yield topped up with buybacks. Fund investors might be more in favour of investment in talent and trading strategies to boost returns, even if that comes at the expense of profits for Man — and potentially dividends and buybacks to Man’s shareholders.

Critics point to the difficulties of resolving that conundrum in an era when other hedge funds do not face similar constraints.

“The problem is if they announce that the dividend yield will be 1 per cent, the share price will crater,” one of the former employees added. “It’s a terribly difficult situation.”

FT : Bigger, new-build superyachts selling despite market downturn

Bigger, new-build superyachts selling despite market downturn
Boats in the 30 metre-plus bracket and multihulls are bucking the post-pandemic dip in sales

The wind may be subsiding in the sailing superyacht market as trading swings back to pre-Covid levels, but sales of new mega-yachts and innovative vessels with eco-credentials are rising fast.

Strong post-pandemic activity, boosted by low borrowing costs and stable inflation, has trailed off overall. According to the latest market report by the SuperYacht Times, sailing yacht sales fell 12 per cent in 2024 compared with 2023. Motor yachts dipped 2 per cent in the same period.

“Covid kind of upset all of the normal patterns,” says Tim Langmead, yacht broker at Fraser in London. “We are part of many industries that saw a boom for 24 months [after the pandemic]. Everywhere, from the east coast of America [to the] Middle East, Australia and definitely the Mediterranean . . . people spent their saved money, whether it was [on] a car, a holiday home or a boat.”

Boat prices soared up to 25 per cent in that period, says Langmead. “It was very much a rare set of circumstances that made that happen and now we’re back to sort of a pre-Covid normality.”

The last “anomalous” year was 2023, according to Italian sailing magazine Giornale della Vela, when the pandemic boosted sales and drove shipyards to produce “too many boats” which have not yet been sold.

Among the worst-hit boatbuilders was Beneteau Group of France. Revenues in the sailing segment — which accounts for 49 per cent of the group total and includes the Beneteau, Jeanneau, Lagoon, Excess, Prestige, Four Winns, Wellcraft, Scarab and Delphia brands — dropped more than a quarter to €495.9mn in 2024, down from €674.5mn in 2023, a record year for sales at the group.

In the group’s 2024 annual report chief executive Bruno Thivoyon said: “It is when boat markets are down that launching new models and new ranges will enable solid operators to bounce back.”

Sales of 30 metre-plus new-build sailing yachts are bucking the downward trend in the superyacht market. According to data from the SuperYacht Times, sales of new sailing yachts measuring between 30 and 40 metres were up 70 per cent last year.

“There were a lot of buyers [of new models] sitting on the fence for some time,” says Ralph Dazert, head of intelligence at SYT. “Sailing yacht buyers can be sort of very serious people who really know what they want, and they take their time. And then last year the available build slots were starting to run out so . . . a lot of people finally bit the bullet.”

According to Dazert, the jump is partly due to sales in the top segment of mega-yachts drying up in 2022 and 2023 after the withdrawal of Russian buyers following Russia’s full-scale invasion of Ukraine. The emergence of wealthy US buyers, he adds, has breathed fresh air into the segment although, he warns, “it might prove to be a challenge to replicate the same success in 2025”.

Superyacht brokers say that overall, while large sailing yachts have enjoyed a bumper year, the gap in market share between motor and sailing yachts — currently 85 per cent versus 15 per cent, according to the SuperYacht Times — is deepening, with sailing vessels losing ground to motor-powered alternatives. “The fleet of motor yachts is growing faster than the fleet of sailing yachts . . . although both groups are growing in absolute terms,” says Dazert.

According to data from the Business Research Company, the global sailboat market reached $6.35bn in 2024, with North America accounting for the largest share, and is expected to hit $7.46bn by 2029, driven by innovation in sailboat design broadening the appeal to novice sailors.

Analysts believe the estimates are driven by an emerging cohort of younger buyers who are challenging the established clientele, which Dazert describes as “slightly older people, mostly men from . . . Italy, but also Brits, northern Europeans [and] Americans buying fast sailing boats to compete in regattas”.

Leisure sailors, who don’t sail competitively, historically have found motorboats more pleasant for cruising, thanks to the stability offered by a larger hull. But as new buyers show a keen interest in comfortable cruising on spacious vessels, demand for catamarans has grown.

Globally, sales of sailing catamarans more than doubled in the year to 2024, according to the SuperYacht Times, accounting for a third of total sailing yacht sales. In 2024 Finnish yard Baltic Yachts began building its first catamaran — a 33-metre multihull named Baltic 107.

More clients at yacht brokerage Northrop & Johnson are leaning towards environmentally cleaner and greener yachting, says Sean McCarter, a broker in the company’s Mallorca office. Catamarans are particularly popular, he adds: “These vessels are increasingly leading the sailing yacht industry thanks to their versatility, offering . . . the ability to balance adventure with comfort seamlessly.”

FT : Inside the fall of Titan

Inside the fall of Titan
VCT group pulls the plug on new investment after its valuation plunges

“Titan’s mission is to invest in the people, ideas and industries that will change the world,” declared the giant of the UK venture capital trust (VCT) sector, in its 2021 annual report.

Back then, Octopus Titan was at its peak, with net assets of nearly £1.4bn. Just over four years later, the bravado is gone and nearly £600mn of that valuation has evaporated.

“We absolutely acknowledge that the performance here has been unacceptable,” admitted Octopus Ventures chief executive Erin Platts in an interview. She was speaking shortly after Titan’s board released the results of a year-long strategic review into the plunging value of its portfolio, comprising around 145 early-stage companies. The VCT also announced a further 5.5 per cent writedown of its net asset value (NAV).  

Platts’ apology on behalf of Titan’s manager, Octopus Investments, came alongside news that the VCT would raise no new money, back no new companies and pay no dividends for the foreseeable future. Octopus’s annual management fee was also cut by 17 per cent and no performance fee will be payable until 2034.

“If I was a shareholder, I’d be fuming that it’s got to this stage,” said Ben Yearsley, co-founder of consultancy Fairview Investing. “Why do you buy a VCT? To get dividends — simple as that.”

VCTs are tax-advantaged vehicles that enable private investors to claim 30 per cent of the amount they put in as relief against their income tax bill. Dividends (yields are typically around 5 per cent) and capital gains are also tax-free if shares are held for five years. But to earn those benefits, shareholders in VCTs must back early-stage companies, some of which will inevitably fail. 

Even allowing for that risk, Titan’s fall from grace has been spectacular. Its NAV per share has dropped by 55 per cent from its peak in December 2021. But the VCT’s 20,000 private investors have fared far worse. Titan’s shares now sell for about 23p, less than half the latest NAV per share of 47.7p.

Of the 20 biggest VCTs by assets that invest in private companies, only Titan has delivered a negative share price total return over five years (-56.9 per cent), according to the Association of Investment Companies (AIC) database.


Established in 2007, Octopus Titan was seen as a successful investor in tech-led disrupters targeting sectors such as consumer, fintech, business software and healthcare. Among its early winners was Zoopla, the online property company that it first backed in 2009 and went on to become one of the UK’s first unicorns — a start-up valued at more than $1bn.

But from around 2016, Titan hugely expanded its fundraising, setting a string of records for the VCT sector and in 2018-19 it accounted for nearly a third of all VCT funds raised that tax year. This surge was partly driven by wealthy savers unable to put more money into their pensions due to successive cuts in the lifetime allowance. But under VCT rules, Titan had a limited period to deploy the money it raised each year and so was forced to continue investing, even as tech company valuations peaked.

Sourcing enough high-quality investments to soak up the cash quickly enough proved a challenge, as the Titan board’s strategic review acknowledges. “The board believes that increased levels of fundraising by Titan may also have negatively impacted average investment quality.”

However, the fundraising surge benefited Octopus by boosting the assets on which it charged management fees, while soaring valuations, until the market peaked in 2021, produced jumbo performance fees on top.

In the five years from 2020, Titan raised £665mn, while Octopus received £225mn in management and performance fees and “other running costs”. The VCT also paid out almost £361mn of dividends in cash or shares and returned £134mn to shareholders through share buybacks.

The growing cash pile also appears to have led Titan to widen its focus to areas where it had less experience and where the potential was less certain. In its 2021 annual report, Titan highlighted five investment “themes” — fintech, health, “deep tech”, consumer and B2B software. Twelve months later, two more had been added, biosciences and climate. Its proposed new investment policy narrows Titan’s future focus to two sectors, fintech and healthcare.

Jonathan Moyes, head of research at broker Wealth Club, suggests that as Titan’s firepower grew, it diluted its original strategy of backing “passionate entrepreneurs disrupting existing markets” by investing in “brand new business models in sectors that don’t exist yet”.

Richard Court, head of EIS and VCT funds at Octopus, disputes this. “Titan was clearly marketed as investing in a range of sectors so I don’t think it said it would do one thing and then drifted in a different direction.”

Even before its list of target sectors expanded, however, Titan’s record of realising profits on its investments was poor. “Of 100 fully realised investments from the Titan portfolio since inception in 2007, 15 achieved a multiple of invested capital greater than 2x and only one of these was greater than 10x,” the review reveals. 

“Actually, 10x is rare,” says Yearsley. “But if you look at lots of VCTs, they’re making three or four times regularly on their disposals.”

A shortage of successful exits has left the trust continually unable to cover its running costs, dividends and share buybacks from its investment gains — hence the halt to fundraising and new deals while it tries to extract value from its current portfolio. Not surprisingly, a key element of the turnaround plan for Titan is to recruit experts in realising investments, through full or partial exits or secondary stake sales.

They will have plenty of raw material to work with. Even now, after its NAV has halved, Titan remains by far the UK’s biggest VCT by total assets — just shy of £800mn versus around £532mn for the next largest, Octopus Apollo, according to AIC data. But measured by market capitalisation, Titan is now second to Apollo, due to its collapsing share price.

The key question for bruised shareholders, who will vote next month on the board’s turnaround plans, is: should they trust the NAV per share figure as the foundation for a recovery, or is Titan’s beleaguered share price painting a more realistic picture of its prospects?

FT : Sanjeev Gupta sells Dubai mansion as his business woes mount

Sanjeev Gupta sells Dubai mansion as his business woes mount
Palm Jumeirah villa sold last month for $11.8mn as part of Liberty Steel was placed in compulsory administration

British steel industrialist Sanjeev Gupta has sold one of his residences in Dubai, cashing in part of his property portfolio at a difficult juncture for his business empire.

Gupta last month sold his four-bedroom, 683-square-metre villa on Dubai’s Palm Jumeirah to an unknown buyer for Dh43.5mn ($11.8mn), according to people familiar with the sale and property records reviewed by the Financial Times. A spokesperson for Gupta declined to comment.

Gupta has amassed a collection of trophy homes around the world even as his industrial empire has faced severe financial difficulties. His property portfolio stretches from the UK to the United Arab Emirates to Australia.

Gupta sold the Dubai property to free up capital to put into his UK business, one of the people said. Last month, part of his Liberty Steel business was placed into compulsory liquidation, with the UK government preparing to fund its operations and pay the salaries of its nearly 1,500 employees across several sites in the north of England.

The ruling last month in the High Court in London stripped away one of the linchpins of Gupta’s GFG Alliance, the conglomerate in which Liberty Steel sits. GFG has been beset by legal claims and criminal probes since the 2021 collapse of its main lender Greensill Capital. GFG denies any wrongdoing.

Gupta has lost control of several businesses over the past year. In May his Singapore-based holding company Liberty House Group was placed into judicial management — a local process whereby courts appoint independent managers to restructure an ailing company — after a court rejected a proposal from the metals magnate to make what the judge called a “minuscule” payment to creditors equivalent to 1 per cent of their $4.2bn of outstanding claims.

In February, South Australia took control of Gupta’s Whyalla steelworks and forced it into administration over unpaid bills and alleged under-investment.

Gupta bought the Dubai house not long after the 2008 Emirati property crash, paying a bargain price of between £1mn and £2mn, the FT previously reported. Palm Jumeirah is an artificial archipelago developed in the 2000s at the height of the emirate’s first property boom.

The house is located on a “frond” of the palm-shaped development populated by mansions, where villas have beach access and many feature swimming pools. Holiday lets cost as much as $2,900 a night, while two larger properties listed for sale have asking prices of Dh60mn and Dh72mn.

Gupta has been seeking to offload other assets in Dubai, according to people familiar with the matter, including a much larger house on the tip of one of the Palm’s fronds.

The 16 palatial villas at the end of these fronds are some of the most sought-after and expensive properties in Dubai, offering unobstructed ocean views.

Gupta struck a deal to purchase the larger villa in 2021, months after Greensill collapsed, according to several people familiar with the transaction. The metals magnate last year listed it as his primary residence in documents relating to a proposed restructuring of one of his steel businesses.

Gupta renovated that home at substantial cost in recent years, according to people familiar with the property. The house also has a dedicated whisky room, according to one person who has visited.

Gupta renamed the property “Jahama”, a contraction of his three children’s first names that the magnate has used on other properties, according to people familiar with the matter and a photo seen by the FT.

Gupta’s other properties include a £42mn mansion in London’s exclusive Belgrave Square, which he bought in 2020 around the time his UK businesses began drawing hundreds of millions of pounds in government-guaranteed Covid loans, and an estate in Wales.

FT Lex : For Gucci-owner Kering, cost-cutting is an up-and-coming trend

For Gucci-owner Kering, cost-cutting is an up-and-coming trend

In the rarefied world of luxury, flair makes or breaks brands. While fortunes in other industries hinge on profit and loss, the maisons appear to thrive on chiffon and intuition. Even so, the financial savvy of former Renault boss Luca de Meo will be instrumental in turning around Gucci-owner Kering.

The root cause of the luxury conglomerate’s troubles is that sales at Gucci, which account for roughly half the parent company’s revenue, have collapsed. This year, they are expected to be down over 40 per cent, on Deutsche Bank numbers, compared to their peak in 2022. 


This tumble has largely been blamed on fickle fashions, and Gucci’s struggles in getting on the right side of them. The brand’s attempts to reverse this have so far floundered. Creative director Sabato De Sarno’s understated elegance only lasted two years. Kering has now plumped for a more flamboyant designer, Demna Gvasalia — whose first looks appeared on the house’s Instagram account on Monday — but whether or not he will be a hit with clients will not be clear for several months to come. 

Nailing fashion fads may look like a job for a cashmere-clad luxury veteran rather than an auto sector lifer. But that misunderstands the issue at hand. While falling sales may mostly be blamed on creativity, reviving them is only partly to do with the esoteric business of picking the right designer, or identifying the season’s must-have print. A lot of it is about having the resources to back the company’s vision. Buying inventory, marketing it and sprucing up stores to reflect the new zeitgeist are all necessary, and all cost a money. 

Trouble is, as things stand Kering has little cash to spare. The cost of running the business — excluding that of the goods sold — has already risen to almost 60 per cent of revenue, or a third more than LVMH. Gucci’s divisional operating margin has more than halved from 35 per cent in 2022 to 16 per cent in the first half of this year. Meanwhile, Kering has acquired brands and stores with abandon, meaning its net debt, by its own measure, is now a toppy 3.4 times adjusted ebitda.


And that is where de Meo’s experience will come in handy. Already, he has postponed the date at which Qatar-backed fund Mayhoola can force Kering to buy its residual 70 per cent of Valentino. He may well step up sales of stakes in Kering’s real estate portfolio, which includes a €1.3bn building in Milan’s Via Montenapoleone. Costs, too, are likely to come in for some streamlining.

Granted, in luxury, wielding the scissors doesn’t have the same impact that it does in carmaking: closing a Gucci store in one place would not make the others more productive. But an auto expert such as De Meo will know that, when reversing out of a tight spot, every inch of extra room is precious.