March 19, 2024

Gold bricks

Hi there, 

Here is this week’s Hot or Not, featuring: 

• Databricks IPO prediction
• Stability AI CEO turnover
• Tech IPO renaissance
• Disappearing fintech unicorns

Hot: Databricks

Nancy Pelosi's getting in on Databricks.  

Given her investment track record, this must be a good sign and perhaps a sign of an impending IPO?

Databricks is valued at $43B as of November 2023, and grew revenue 50% year-over-year to $1.6B in its fiscal year ended in January. 

It has been deploying its extra cash into acquisitions (including MosaicML for $1.3B) and genAI investments. 

Databricks’ valuation is now within striking distance of publicly traded Snowflake ($52B market cap). Of course, it’s worth remembering that Snowflake's market cap got pile-drived after its last quarter and the news of General Slootman stepping down. 

Databricks’ customer satisfaction (CSAT) score is 9/10 indicating high satisfaction, based on interviews with software buyers conducted by CB Insights. Its scouting report (image below) highlights additional opportunities and weaknesses.

What's your prediction for a Databricks IPO? Early 2025?

Generate these insights in 1 click with our AI-generated scouting reports. 

Not: Stability AI

Earlier this week, Emad Mostaque stepped down as LLM maker Stability AI's CEO.

The news follows a leadership switch-up at another high-profile AI startup last week.  

The odds have gone up on our prediction of a Stability AI acquisition and who we think acquires them. 

As LLM development gets commoditized, expect more consolidation.

WDYT about our prediction?

Hot: Tech IPOs

Speaking of predictions: We named Reddit as one of our Tech IPO Pipeline picks last fall — and it made its public debut last week.

Its stock surged 48% on its first day of trading, and it’s currently up over 75% from its debut price.

Despite Reddit being unprofitable, investors are excited about it as a potential gold mine of AI training data, per the funding insights on its CB Insights profile.

Reddit’s post-IPO success could be a major breath of fresh air for the stale tech IPO market.

Check out our other 250+ picks for who we think could go public next.

Not: Fintech unicorns

The number of global fintech unicorns is stagnating.

Our latest unicorn market map features 219 unicorns in financial services — up just 3 from the 216 we profiled in our previous update in October 2023. 

Among today’s fintech unicorns, just 12 were born in all of 2023, vs. 111 in 2021.

In the US, new fintech unicorns have all but disappeared. Globally, there were 7 new fintech unicorns in the last 6 months, and just 1 is based in the US: Vestwell, an investing platform for workplaces.

Asia, on the other hand, counts 5 of those 7: Tabby and Tamara in MENA, Perfios and InCred in India, and HashKey in Hong Kong.

Download data on all 1,200+ unicorns for free here.

I love you. 

Anand 

@asanwal 

P.S. Learn how our analysts used CB Insights data to select the most promising AI companies in the world. Register here.

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