Author: openjargon

  • Wall Street still isn’t fretting about geopolitics, even after Iran attacked Israel

    The flags of Iran, left, and Israel, right.
    The flags of Iran, left, and Israel, right.

    • Wall Street has had a muted reaction to Iran's attack on Israel so far.
    • US stock futures rose in Monday's premarket, while benchmark oil prices dropped.
    • It's another reminder that traders are more worried about interest rates than geopolitical tensions.

    The market served up another reminder of its indifference to geopolitics on Monday, as traders seemingly shrugged off the potential impact of Iran's strikes on Israel.

    US stock futures climbed higher in premarket trading to pare back some of their losses from a rough Friday session, while benchmark Brent and West Texas Intermediate oil prices fell despite the threat of supply disruptions in the Middle East.

    Meanwhile, both gold and the US Dollar Index — which tracks the greenback's strength against a basket of six other currencies — started off the week in the red, in a sign investors are shunning so-called "safe-haven" assets despite the potential for increased volatility. Yields on 10-year US Treasury notes traded flat.

    Signs that the conflict between the two countries won't escalate any further have calmed the market's nerves, XTB research director Kathleen Brooks said on Monday. Iran said in a statement that "the matter can be deemed concluded," while Joe Biden has signaled that the US won't take part in any counter-strike against Tehran.

    "There is a sense that this attack from Iran could have been a lot worse, instead Iran has drawn a line under it and said that it deems the matter concluded," Brooks wrote in a research note. "From a geopolitical perspective, the focus now is on the Israeli response, however, the limited impact of the Iranian attack and the G7 calling for restraint, may limit the impact on financial markets in the short term."

    "The initial reaction seems to be one of relief," she added. "The dollar opened the week fairly muted and US bond yields are slightly higher, suggesting that there was no flight to safe havens."

    Anyone who's been following markets for the past two years won't be surprised at traders' muted reaction to the latest tensions in the Middle East.

    While big names on Wall Street including JPMorgan boss Jamie Dimon and billionaire Bridgewater founder Ray Dalio have repeatedly warned of a global crisis, the market has tended to respond to developments surrounding Israel by shrugging its shoulders.

    Since Hamas' first attack on October 7, the S&P 500 has climbed 19% — while oil benchmarks have ticked up by around $7 a barrel, much shallower gains than might have been expected amid a conflict in the vicinity of many of the world's biggest oil producers.

    Capital Economics ' group chief economist Neal Shearing said in a research note on Sunday that Iran's drone strikes are unlikely to impact stocks unless they drive a massive run-up in crude prices that leads to the Federal Reserve delaying its first expected interest-rate cut.

    "The key risks for the global economy are whether this now escalates into a broader regional conflict, and what the response is in energy markets," he said.

    "As things stand our sense is that events in the Middle East will add to the reasons for the Fed to adopt a more cautious approach to rate cuts, but they won't prevent it from cutting altogether," Shearing added, noting that the OPEC+ cartel choosing to up production levels could offset any price rises driven by Iran's attack.

    It's a reminder that the key person who'll shape the direction US stocks go this year isn't Vladimir Putin, Xi Jinping, or Iran's supreme leader Ali Khamenei — it's the central bank's chair, Jerome Powell.

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  • Franchisees say they’re the real losers of California’s $20 fast-food wage

    Mims, Florida, McDonald's Fast food restaurant inside cashier and checkout counter, 2023
    The $20 minimum wage for fast-food workers came into effect on April 1.

    • Restaurant franchisees say they're the real losers of California's $20 fast-food minimum wage.
    • The wage applies to franchisees, even if they just own one or two restaurants.
    • Franchisees say that they're small business owners and will struggle to absorb increased costs.

    Franchisees say they have to bear the brunt of California's new $20 minimum wage for fast-food workers.

    "One of our biggest complaints is it's not so much that we're arguing what workers should make, it's that the reality is the bill for this legislation is on the backs of franchise owners," Keith Miller, who owns three Subway stores in northern California, told Business Insider.

    The legislation, AB 1228, applies to limited-service restaurant chains with at least 60 locations nationwide.

    Fast-food chains often stress the nature of their franchisees as small-business owners. But the $20 wage applies to both corporate-owned and franchise restaurants, even if the franchisee just owns one or two restaurants.

    "We're a small business," Brian Hom, who owns two branches of Vitality Bowls — a smoothie and Acai bowl chain with around 70 stores nationwide — told Business Insider.

    Hom, whose stores are in San Jose, California, said that he ran the stores with his wife, two sons, and daughter-in-law. "We're not people who are a corporation."

    Franchisees have been raising their menu prices and exploring ways to cut costs to offset the impact of the $20-an-hour minimum wage, such as introducing more technology and dropping staff benefits. Some franchisees say it's easier for company-owned stores to absorb the impacts of the legislation.

    "I definitely know that corporate stores have a deeper pocket," Hom said. "We don't have a large profit margin … We're not a corporate store that has maybe some ways they can cut costs."

    Hom said that he had put up prices, stopped hiring, and reduced the number of workers on each shift to increase his revenues and reduce his costs over the new $20 wage. Miller, the Subway franchisee, said he'd raised his prices, too.

    "I think what people keep forgetting is the fact that they keep seeing McDonald's Corporation or these public corporations making record profits, that doesn't mean the franchise operators are making record profits," Miller said.

    Mike Mangoine bought his first McDonald's restaurant with his father in 1967, The Los Angeles Times reported. Now he owns 19 around Los Angeles and California's Inland Empire area.

    "It's not just this giant corporation that runs things," Jessica D'Ambre, his daughter who manages the restaurants with him, told The Times. "I think that's where the misconception lies, especially with politicians." She added that the new $20 wage felt like an "unfair target on our backs."

    "We run it like any other family business," D'Ambre said.

    Matthew Haller, the president and CEO of the International Franchise Association, told BI in a statement that the legislation would lead to "many small businesses struggling to keep their doors open."

    'Franchise operators keep getting squeezed more and more'

    The costs of being a franchisee vary drastically by chain, location, and the size of the restaurant. To become a Subway franchisee in the US, people generally need to have a $150,000 net worth per restaurant, with $100,000 in liquid assets. For both Wendy's and Burger King, wannabe franchisees need a total net worth of at least $1 million, including at least $500,000 in liquid assets.

    As well as real-estate and initial development costs, franchisees have to pay a proportion of their sales to their franchisor as royalty and advertising fees.

    Earnings can vary greatly, too: Chick-fil-A's average unit volumes — the total sales per restaurant — were $7.5 million last year, compared to $3.7 million for McDonald's and $1.9 million for Taco Bell, according to data from foodservice-industry group Technomic.

    This is before deducting any costs including labor, food, and fees.

    Franchisees are a major part of the fast-food business — they reduce risk for chains and enable them to explore new markets. At McDonald's, 95% of its US restaurants are franchised.

    Some franchise companies own hundreds of restaurants. Miller said policies such as the new $20 minimum wage would push small franchise owners out of the industry.

    "Franchise operators keep getting squeezed more and more," Miller said, referring to the introduction of new fees by restaurant chains.

    "You're not going to have people who own one to three stores anymore," he said. "You're going to have to have the mega owners as they're called, or 20 stores, a hundred stores, 500 outlets. And they're not really operators, they're investors at that point because they're not going in and running the store."

    Are you a fast-food worker excited about the new minimum wage? Or a franchisee or restaurant manager worried about how it will affect your business? Email this reporter at gdean@insider.com.

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  • AI could split workers into 2: The ones whose jobs get better and the ones who lose them completely

    Two workers who are impacted differently by AI technologies.
    The adoption of AI technologies won't replace everyone's jobs. But some workers could be most at risk.

    • The adoption of AI technologies could make some workers more productive and replace others. 
    • A White House report found that 20% of Americans had jobs that were particularly likely to be impacted by AI.
    • Lower-income workers without a college degree could be at the most risk of AI job replacement

    Nothing is certain about the future of AI technologies, but three things are becoming more clear.

    1. AI is likely going to impact or change millions of jobs in the years to come.

    2. It's likely going to make some workers more productive.

    3. It's likely going to replace some workers.

    The million-dollar question is, how many workers — and what jobs — are most likely to see the positive and negative impacts of AI?

    Twenty percent of Americans worked in "high exposure" jobs that were most likely to be impacted by the adoption of AI technologies, according to a White House report released in March by the Council of Economic Advisors.

    To be sure, the authors weren't suggesting that 20% of Americans were likely to see their jobs replaced by AI. That's because AI-related job changes could impact one job task but leave all others untouched. Additionally, these changes could bring about positive outcomes for workers.

    That said, if and when some AI job replacement does come, some workers could be more at risk than others.

    "Some workers typically benefit from technological change, either because the evolving technology provides new labor market opportunities for them or because it enhances their productivity in their current job," the council wrote. "Conversely, some are harmed, typically due to job displacement."

    The council's findings highlight what could be a reality of the coming AI boom: It'll be good for some workers and bad for others. While the adoption of AI technologies could help some workers become more productive, spend less time on boring tasks, earn higher wages, and even have a four-day workweek, others could face more competition, earn lower wages, or even see AI replace their jobs.

    Lower-wage jobs could be at the most risk of being replaced by AI

    The report didn't highlight specific jobs or industries that are most likely to be negatively impacted by AI.

    But the council wrote that workers at the highest risk of replacement fit two criteria: Their jobs were highly exposed to AI and had lower "performance requirements" — meaning their job tasks had a lower degree of "difficulty or complexity" that may be more likely to be automated.

    Ten percent of US workers fit both criteria, the council found. They tended to be lower-income workers without a college degree.

    The findings "suggest that AI may be a skill-biased technology, increasing relative demand for workers with high levels of education in high-earning occupations," the council wrote. "They also suggest that AI could exacerbate aggregate income inequality if it substitutes for employment in lower-wage jobs and complements higher-wage jobs."

    Perhaps counterintuitively, the council found that the cohort of workers whose jobs had among the highest exposure to AI — people with a bachelor's degree — were the least likely to have a high-exposure job with low-performance requirements, the combination of roles at most risk of replacement.

    Twenty-one percent of people with a bachelor's degree worked in jobs that are highly exposed to AI, the council found. However, only 6% worked in high-exposure jobs that also have low performance requirements. Conversely, 17% of high school graduates had jobs with high AI exposure, and 14% had jobs with both high AI exposure and low performance requirements.

    This suggests that college-educated workers could be more likely to see the productivity benefits of AI, rather than see their jobs replaced by these technologies, the council theorized.

    Meanwhile, 20% of women had jobs that are highly exposed to AI, compared to 19% of men. Twelve percent of women had jobs that fit both the high exposure and low performance requirement criteria, compared to 9% of men.

    The world isn't black-and-white, so it's unlikely AI's impacts on workers will be either. That means it's unlikely that every worker whose job is changed due to AI will be able to be clearly placed in a "good change" or "bad change" bucket.

    The council cited the hypothetical example of a school bus that can drive itself, which, in theory, could render a bus driver's job obsolete. In this scenario, the bus would likely need an adult on the bus to supervise the children.

    "AI-led automation might fundamentally change the school bus driver's job, but it is unlikely to eliminate the job," the council wrote.

    In this example, the bus driver gets to keep their job — a good outcome — but the nature of their job has changed substantially.

    Major economic changes tend to help some workers and hurt others

    The AI boom wouldn't be the first major shift in the global economy to have divergent impacts on workers.

    When China emerged as a major player in global trade in the 1980s, some economists argued that the deluge of low-cost products was a net positive for the US, even though some domestic manufacturing jobs were lost in the process.

    "The people who lost their jobs lose money to the China shock, but the rest of us get cheap goods at Walmart and Target or whatever," Nobel Memorial Prize-winning economist Angus Deaton previously told Business Insider. "And the theorem says the value of what we gain is more than the value of what they lose."

    Deaton said he's grown increasingly uncertain that this trade-off has been worth it.

    It remains to be seen whether the tradeoffs that come from the AI boom will be a net positive for Americans. Re-training workers who lose their jobs due to AI could help move the needle in a more positive direction.

    But as Deaton's globalization example illustrates, the US doesn't have a great track record of helping displaced workers find new jobs.

    Has your job been impacted by AI technologies for better or worse? Are you willing to share your story? If so, reach out to this reporter at jzinkula@businessinsider.com.

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  • Tesla is laying off more than 10% of its workforce, memo shows

    Tesla announced layoffs.
    Tesla announced layoffs.

    • Tesla is reducing its workforce by more than 10%, per an internal memo seen by Business Insider. 
    • Earlier this month, Tesla's delivery numbers slumped below Wall Street expectations.
    • The carmaker employs over 140,000 people across the globe.

    Tesla is the latest major company to lay off employees.

    The company is eliminating "more than 10%" of staff globally, according to an internal memo sent by Elon Musk on Sunday, which was seen by Business Insider. The layoffs come shortly after the carmaker posted lackluster delivery numbers.

    Musk wrote in the email, "There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth cycle."

    Some Tesla employees lost access to their emails and Teams by Monday, two people with knowledge said.

    Tesla's first-quarter delivery numbers revealed a significant slump — falling below Wall Street's estimates. Tesla deliveries in the first quarter fell 20% from the previous quarter and over 8% from the same time the previous year, marking the company's first year-on-year sales decline since 2020.

    In a press release, Tesla blamed the decline in deliveries on its production ramp for its refreshed Model 3, an arson attack at its factory in Berlin, and supply-chain issues caused by the Red Sea conflict.

    There have been rumors of a coming layoff in recent months. In February, the carmaker reportedly called for managers to begin identifying the most vital roles for the company. At the time, Tesla also delayed some workers' performance reviews, Bloomberg reported. The reviews were later rescheduled, three sources told Business Insider.

    A spokesperson for Tesla did not immediately respond to a request for comment.

    Before the layoffs, Tesla said it employed over 140,000 workers globally, including over 20,000 at its Fremont factory in California.

    Tesla CEO Elon Musk has a history of reducing staff to cut costs. The billionaire famously cut Twitter's workforce in half after he purchased the company in 2022. And Tesla has conducted multiple rounds of layoffs before.

    Last year, Tesla laid off dozens of its employees working on its Autopilot service at one of its sites in Buffalo, New York. At the time, the company said the terminations had nothing to do with a union campaign at the facility that had been announced the week before. The company said it dismissed the employees for poor performance.

    Tesla appeared to slow down its hiring last year. Musk told staff in May that he must personally approve all new Tesla hires.

    During Tesla's earnings call In January, Musk warned of a sales slowdown in 2024 and said the company was "between two major growth waves."

    Over the past year, the automaker has continually slashed prices for its vehicles and tried its hand at advertising for the first time in the company's history. Tesla is also facing increased competition from Chinese automakers.

    Musk has also warned that Tesla could face production hurdles in the coming year as it tries to ramp up production of the Cybertruck and Tesla's next-gen vehicle platform.

    This is a developing story. Check back for updates.

    Do you work for Tesla or have insight to share? Reach out to the reporter from a non-work email and device at gkay@insider.com

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  • I went to school in Texas and Saudi Arabia. The differences between the 2 systems actually set me up better for the future.

    Girl holding cotton candy
    The author moved from Saudi Arabia to Houston, Texas.

    • My brother had a rare cancer that force my family to move from Saudi Arabia to Houston. 
    • I was fluent in English before we moved because I went to an international private school in Saudi. 
    • I don't think one school system is better than the other, I like and dislike things from both. 

    My Texan middle school was vibrant, a large fine arts hub tucked in West University, Houston. It had Glass ceilings, rooms cluttered with cellos and trumpets, art plastered over rows of lockers, and a baseball and football field to match. The weekly bake sales were just as much of a staple as our daily recitation of the Texas pledge.

    But life at an American school was only a part-time gig for me. Growing up, my older brother had osteosarcoma. The cancer diagnosis led my family to uproot our lives in my home country of Saudi Arabia and move to Houston for him to seek treatment.

    From the desert to Cowboy County, I ended up trying everything from public to private to online school.

    "Where do you like it better?" I was asked the same questions in various accents and languages throughout every grade. The answer is not straightforward, as there are things I liked and disliked from my experiences.

    My English was good when I moved to the US

    My parents always did their best to enroll me in international schools in Saudi, as they were the only ones who taught in English. My Arabic reading and writing skills were too weak over the years to handle the high level of Arabic grammar and literature taught in Saudi public schools.

    In Texas, a good education meant moving into the "good" neighborhoods to be zoned for the "good" schools. In Saudi, it meant succumbing to private school tuition, as only international private schools taught in English.

    My schedule was packed in Saudi Arabia

    My backpack was jam-packed with thick books from the sheer number of subjects we had to juggle in Saudi schools. At a mere 10 years of age, I was taking Arabic, French, English, Islamic, Algebra, natural sciences and history.

    Mornings consisted of a mandatory assembly at the front of the school to do a short series of stretches to prep ourselves for the day and hear announcements from the headmistress.

    Although school only ran from 7 a.m. to 12:30 p.m., I was putting pencil to paper for a significantly longer period of time than in Texas. Pencils, paper, and hard steel desks. A simple room for a simple task — getting the grades. I always felt a stronger desire to adhere to order and perfection when in Saudi and perhaps the design of our classrooms was an unconscious form of encouragement to focus. I found the difference in schooling to be reflective of the culture and general mindset of life. No frills.

    While my visually barren classrooms were a nightmare for me, my Saudi classmates didn't give it one thought. A class schedule and wall clock were enough. I missed the posters stapled on tops of posters with dangling flyers that colored the walls of my American schools. For me, the messy and vibrant visuals made me happier.

    I was allowed to experiment with creativity in the US

    In the US, you are not only left to linger in thought but encouraged to do so. We were asked to experiment and play. In Saudi, you ask yourself long-term life questions early. Do I want to be a doctor? Do I want to be an engineer? I love to dream, but there is something comforting about approaching your future in a definitive way and choosing your goals early on.

    Because of the laser focus on academics in Saudi, I was unable to find the time to explore my creativity through the arts until a much older age when musical instruments, painting, and writing became more accessible. As uncoordinated as I was, it was also common to let out energy at school through sports. As a majority of schools are gender segregated in Saudi, I often felt more comfortable being bad a soccer or working up a sweat among a community of girls than I did in my mixed American schools.

    Oftentimes, people would praise my academic abilities and attribute them to one schooling system over the other. I'm good at math because of my Saudi schools, but I'm good at English because of my Texan schools, or so I was told. I don't think one or the other is particularly the right way.

    In reality, it was the mix of routine from the Saudi structure and the more fluid and creative methods of American schooling that allowed me to excel.

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  • Beware: leaving a big city could be really bad for your career

    A man crossing the street with money falling out of his suitcase

    Ever since hordes of Americans began fleeing big coastal cities during the pandemic, I've been wondering when — or if — they'd return. Sure, things are less expensive in the places they moved to, and the quality of life is often higher. But more and more, urban refugees have been pining for the things they left behind, from culinary excellence to cultural diversity. Every week it seems like I see a new story about some former San Franciscan or New Yorker regretting their decision to leave.

    So recently, when the Census Bureau released its new estimates for domestic migration, I thought we were finally going to see a reversal of the big-city exodus. But I was wrong. From mid-2022 to mid-2023, the bleeding in many big metropolitan areas continued. New York lost 238,000 more people than it gained. The numbers read like casualty reports: 155,000 in Los Angeles, 54,000 in San Francisco, 25,000 in Seattle. Granted, the urban flight isn't as bad as the crisis-level hemorrhaging we saw in the first year of the pandemic. But every day, hundreds and hundreds of people continue to forsake America's greatest cities for smaller, more affordable destinations.

    We've heard a lot about how the mass migration has been bad for major cities, sending them into a "doom loop" of empty offices and shuttered storefronts. But a new paper coauthored by Enrico Moretti, one of the best thinkers on the geography of jobs, highlights the dangers the migration poses for the very professionals who are ditching big cities. Moving away from a major city, Moretti found, can be terrible for your career.

    Moretti, an economist at the University of California at Berkeley, followed workers whose companies shut down between 2010 and 2017. How people fared after that depended on where they lived. Those who lived in small labor markets were less likely to find a new job within a year than those in large labor markets. To get back on their feet professionally, those in small markets were more likely to be forced to relocate for employment. They were also more likely to settle for a role that was misaligned with their college degree, or in an entirely different industry.

    "The big takeaway is that market size matters," Moretti says. "It's clear that larger markets improve the quality of the match."

    That's precisely why workers and the companies that employ them tend to cluster in the same cities. Economists call it agglomeration. Let's say you're a coder specializing in AI. You're far more likely to find a job in San Francisco than you are pretty much anywhere else in the world, because there are a lot of AI-related companies there. And it's because AI specialists flock to San Francisco that AI businesses set up shop there in the first place. That's how cities become hubs for particular industries, like finance in New York and fashion in Paris. And that's why people put up with all the downsides of cities — because it increases their odds of growing their careers. Moretti's new paper confirms that when it comes to jobs, geography is destiny.

    At first it seemed as though the pandemic had rewritten that rule. With the rise of remote work, professionals thought they could afford to leave their expensive cities without a risk to their careers. If you moved to Des Moines and wound up losing your job, you could just stay put and get another work-from-home gig. Your house might be in Iowa, but your job market was still back in California or New York.

    But over the past year, more and more employers have stopped hiring for remote roles. The market for WFH jobs has cratered, putting everyone who moved away from big cities at risk. If they wind up getting laid off or they outgrow their current role, living in a smaller job market is going to severely limit their career options. As Moretti's paper shows, they'll either (1) wind up unemployed for a long stretch, (2) be forced to settle for a local job they're overqualified for, or (3) have to make an abrupt and costly move back to the big city they abandoned.

    Moretti characterizes being in a large labor market as "insurance" against future shocks. Living in a big city isn't just about having a good job right now. It's what sets you up for success to land your next job — and the job after that. Those who moved away from big cities effectively gave up their career insurance.

    And that's not all they gave up. When you live in an industry hub, you're surrounded by professional peers, making it easier for you to accumulate knowledge and skills. That's not just because you get to collaborate in person with your coworkers every day. In a big city, you also run into people who work for other companies in your industry — on the bus, at the bar, in line at the deli. Those serendipitous conversations not only expand your professional network, they also create what economists refer to as "knowledge spillovers," helping you learn new stuff that's relevant to your work. That's why innovation, as measured by patents, is higher in large markets, and why businesses in big cities tend to have higher productivity.

    These upsides to living in a big hub are less obvious than the low rents and nice homes that have lured so many professionals to smaller cities. They also take time to manifest — you have to lose your job before you realize how hard it will be to find another. So professionals haven't come to grips yet with what they gave up by moving away. "The benefits of being a big city," Moretti tells me, "have been underappreciated" during the pandemic.

    Until recently, I was one of those underappreciators. In 2021, my remote job allowed me to move from San Francisco to Sacramento for my then-wife's job. We could suddenly afford a spacious two-bedroom in an apartment complex with a pool, and I loved the slower pace of life. Even after we split up, my initial plan was to stay in Sacramento. But as I started driving into San Francisco more often to meet with sources in the tech industry, I realized that being in the city was helping me come up with better story ideas. So a few months ago, I moved back to the Bay Area. Being here makes me better at my job. And if I should lose my job at some point, I know my search will go much better here, where there are more journalism jobs, than it would if I had stayed in Sacramento.

    Of course, lots of professionals who left big cities during the early days of remote work will stay where they are, even if they lose their jobs. After all, one of the other trends spurred by the pandemic was the realization that career isn't everything. Plenty of people will be happy to settle for a lesser job if it means they don't have to sit in soul-crushing traffic and can have a big backyard for their kids.

    But Moretti thinks the exodus from big cities is nearing an end. As the outward migration slows, he predicts, new people looking for career opportunities will flood into urban areas, more than making up for the people who left. The big hubs will resume agglomerating, just as they did in the decades leading up to the pandemic. Cities, in short, will be cities again.

    "It's more a matter of when than if," Moretti says. "I never thought this was going to be a permanent change in the geography of labor."

    Madison Hoff contributed reporting.


    Aki Ito is a chief correspondent at Business Insider.

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  • AI startups were red hot in 2023. Check out 37 pitch decks used by founders to land funds from some of the world’s biggest tech investors.

    The ElevenLabs team
    ElevenLabs uses AI to create realistic voiceovers. It was among an array of AI startups to land VC funding this year.

    • AI startups raised $60 billion last year and investors have continued to pile in on the tech in 2023.
    • The frenzy around AI comes after the launch of OpenAI's ChatGPT chatbot.
    • Below are 37 pitch decks used by startups deploying AI in everything from health to property.

    There's an AI gold rush right now.

    Investment into startups using or creating artificial intelligence hit an all-time high in 2021, with $113.3 billion poured into the sector, per Dealroom data. This fell to $60 billion in 2022 but that figure is likely to be exceeded this year with $57 billion already invested by venture capitalists.

    The investor rush is down, in part, to the release of ChatGPT in late 2022 by US startup OpenAI, cofounded by Sam Altman and Elon Musk. The chatbot became the fastest-growing app in internet history, and almost immediately disrupted education, copywriting, consultancy, and other sectors.

    It's possible that it's just another bubble, akin to the short-lived Web3 fad of 2022. But proponents say AI has broader use cases and few similarities to crypto's "cynical business models". AI was also alive and well long before the current hype around generative AI.

    Recent, high-profile rounds include Andreessen Horowitz and ex-GitHub CEO Nat Friedman leading an anticipated $18 million round into voice intelligence startup ElevenLabs, at a possible valuation of $100 million. Venture capitalists are also eyeing startups in the vector-database sector, where valuations are hitting up to $700 million

    These are some of the pitch decks that founders have recently used to raise millions for their AI startups, from top investors such as Temasek, Insight Partners, Alven, Index Ventures, and more.

    V7 cofounders
    V7 cofounders Alberto Rizzoli (CEO) and Simon Edwardsson (CTO).

    Generative AI, media, and design

    This startup uses generative AI to speed up the property-buying process. Check out the 14-slide pitch deck Orbital Witness used to raise $9 million.

    Wondercraft wants to be the AI-driven 'Canva of audio.' Check out the 9-slide pitch deck it used to raise $3 million.

    Kinnu helps users improve their long-term memory and their rate of learning. Check out the 14-slide pitch deck it used to raise $6.5 million.

    Portkey.ai makes it easier to build generative AI apps. Check out the 14-slide deck it used to raise $3 million from Lightspeed.

    Aindo uses generative AI to develop synthetic data. Check out the 13-slide pitch deck used to secured $6 million.

    Supernormal, a generative AI startup that automates meeting notes, just raised $10 million. Check out the 17-slide pitch deck it used to bag the seed round.

    This startup, founded by ex-Google and Palantir staffers, uses AI to generate realistic voiceovers. Here's the 14-slide pitch deck ElevenLabs used to raise $2 million.

    Creative Fabrica raised $61 million after launching AI design tools based on GPT-3 and Stable Diffusion. Check out its 19-slide pitch deck.

    Checkstep uses AI to moderate online platforms. Here's the 7-slide pitch deck it used to raise $5 million in seed funding.

    This AI startup helps Big Tech firms compress videos while maintaining quality. Check out the 50-slide pitch deck Deep Render used to raise $9 million.

    Health tech

    This former Googler's stealth startup helps scientists design proteins using AI. Check out the 16-slide deck Cradle used to raise $5.4 million in seed funding.

    Thymia uses AI to assess and track patients' mental health conditions. Check out the 9-slide deck it used to secure $2.7 million.

    These 3 founders are using AI to analyze patients' biological profiles and recommend drugs. Here's the 15-slide pitch deck they used to raise $5 million backed by Microsoft.

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  • Iran’s attack on Israel could be bad for Russia’s war in Ukraine

    Russian President Vladimir Putin and Iran's President Ebrahim Raisi hold a meeting in Tehran on July 19, 2022.
    Russian President Vladimir Putin and Iran's President Ebrahim Raisi hold a meeting in Tehran on July 19, 2022.

    • Iran's attack on Israel could impact Russia's war in Ukraine.
    • Iran is a key arms supplier and economic partner to Russia.
    • A broader Middle East conflict could also boost China's regional influence at Russia's expense.

    Iran's attack on Israel on Saturday is bad not only for the Middle East, but also for Russia's war in Ukraine as new fault lines emerge between Moscow and Tehran.

    Michelle Grisé, a senior policy researcher at RAND, an American think tank, described in a commentary how a broader conflict in the Middle East could impact Russia. The commentary was first published in The National Interest magazine on April 11 — days before Iran launched more than 300 drones and missiles at Israel on April 13.

    Grisé's piece followed a strike on Iran's embassy in Damascus, Syria, on April 1. Israel did not claim responsibility for the strike, but Iran held it accountable and vowed retaliation.

    "Although it has been argued that Moscow benefits from chaos in the Middle East — diverting Western attention and resources from Ukraine — it stands to lose a great deal if the Israel-Hamas conflict escalates into a wider war," Grisé wrote.

    Russia has been installing itself as a military and diplomatic player in the Middle East for years.

    Moscow has capitalized on instability in Syria and Libya to establish itself as a regional security guarantor, but an escalation of the conflict in the Middle East would not have the same effect, Grisé wrote.

    This is in part due to Moscow's preoccupation with its war in Ukraine, Grisé wrote. Russia's partnership with Iran has also deepened in the last two years as Russia's heavily sanctioned economy became increasingly isolated.

    Iran is now a critical military supplier to Russia. An Iranian "ghost fleet" has also been carrying Russian oil around the world since the war in Ukraine started, keeping Moscow's oil revenue flowing.

    However, should Iran become embroiled in a wider conflict, it would not be able to provide the same level of support to Russia.

    "A broader regional conflict, particularly if it involves direct conflict between Israel and Iran, would limit Iran's ability to continue serving as a military supplier to Russia," wrote Grisé.

    Furthermore, "Tehran may demand more support when Russia has limited capacity to provide it," she added.

    The Group of Seven, or G7, nations is already considering additional sanctions against Iran following its attack on Israel — which could spill over to Russia.

    "We will reflect on additional sanctions against Iran in close cooperation with our partners, specifically on its drone and missile programs," Ursula von der Leyen, the European Commission president, said in a statement on Sunday.

    A broader Middle East conflict could boost China's clout in the region at Moscow's expense

    Even though Russia is preoccupied with the war in Ukraine, President Vladimir Putin has still managed to position himself as a potential power broker in the Middle East amid the Israel-Hamas war.

    But Putin's plan could fall apart should the war spill over regionally, since Beijing is also jostling to play peacemaker.

    "Russia would be especially sensitive to Chinese attempts to encroach on its influence in the Middle East," Grisé wrote in her commentary.

    This is especially so since Beijing managed to deliver results in March 2023, brokering a détente between Saudi Arabia and Iran, Grisé added.

    Since Russia's heavily sanctioned economy is already reliant on China, it would be even more exposed to Beijing's whims should Moscow not be able to hang onto any shred of global influence it still has.

    In a statement on Sunday, Russia's foreign ministry expressed "extreme concern" at what it called "yet another dangerous escalation" in the region.

    Calling for restraint, Russia's foreign ministry said it expects regional states "to resolve the existing problems through political and diplomatic means."

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  • Watch out Jeff Bezos and Lauren Sánchez — Mark Zuckerberg and Priscilla Chan are trying out mob chic, too

    Priscilla Chan and Mark Zuckerberg.
    Priscilla Chan and Mark Zuckerberg attended the UFC 300 event on April 13, 2024.

    • Jeff Bezos and Lauren Sánchez aren't the only couple that's stepping it up in the fashion arena.
    • Mark Zuckerberg and Priscilla Chan were seen trying out the "mob chic" look at Saturday's UFC event. 
    • Zuckerberg rocked a fit straight out of Eminem's rapper-swag playbook, while Chan went for an all-black number.

    Step aside Jeff Bezos and Lauren Sánchez; there's a new it couple in town, and they're coming for the "mob chic" crown.

    Meta founder Mark Zuckerberg and his wife, Priscilla Chan, debuted some fashionable fits at Saturday's UFC 300 event.

    "What an epic night," the tech billionaire wrote in a Facebook post on Sunday.

    While this isn't the first time Zuckerberg, a known martial arts enthusiast, has taken his wife to a UFC event, the couple has had a major fashion glow-up.

    In October 2022, Zuckerberg and Chan attended a UFC Fight Night event together. At the time, Zuckerberg wore an army-green T-shirt, while Chan wore a floral print dress.

    Priscilla Chan and Mark Zuckerberg at a UFC Fight Night event back in October 1, 2022.
    Priscilla Chan and Mark Zuckerberg at a UFC Fight Night event on October 1, 2022.

    Now, it seems they have majorly stepped up their ringside fits.

    Zuckerberg rocked what looked a lot like an Eminem-inspired outfit on Saturday, donning a simple white t-shirt and black pants. He also wore a chain to complete the look, leaning into some rapper swag straight out of the 2000s.

    Chan, meanwhile, appeared to be trying her hand at the "mob wife" aesthetic that's gone viral on social media. Besides donning sunglasses, Chan wore a gold necklace and paired it with a slick all-black outfit.

    Zuckerberg and Chan may be taking a leaf out of Bezos' and Sánchez's playbook.

    In January, Bezos and Sánchez were spotted channeling the "mob chic" look when they attended the Dolce & Gabbana Party at the Milan Fashion Week.

    Lauren Sanchez and Jeff Bezos attend a Dolce & Gabbana parry in Milan in January 2024.
    Lauren Sanchez and Jeff Bezos attend a Dolce & Gabbana parry in Milan in January 2024.

    Both glow-ups appear to mark an intentional, choreographed shift in fashion choices by tech billionaires like Zuckerberg and Bezos. Both men have abandoned low-effort, casual dressing in favor of louder luxury, with a lot more bling.

    And nowhere has that shift been clearer with Zuckerberg. The now-shredded Meta founder has ditched his once-standard array of gray t-shirts and hoodies for shearling brown jackets and other statement pieces.

    Zuckerberg has also been down to trade fits with his fellow billionaires.

    In March, Zuckerberg said he did a "jersey swap" with Nvidia CEO Jensen Huang. The pair were photographed swapping jackets, with Huang wearing Zuckerberg's brown coat while Zuckerberg wore Huang's iconic black leather jacket.

    Zuckerberg even had major watch envy when he saw Anant Ambani's Richard Mille watch during the latter's pre-wedding celebrations in March.

    "You know, I never really wanted to get a watch. But after seeing that, I was like, watches are cool," Zuckerberg said then.

    Representatives for Zuckerberg at Meta did not immediately respond to a request for comment from Business Insider sent outside regular business hours.

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  • Ex-CIA director says Israel could use ‘covert’ operations to retaliate against Iran’s drone strikes without escalating the conflict

    Former CIA director and retired general David Petraeus.
    Former CIA director and retired general David Petraeus.

    • David Petraeus told CNN that Israel could mount a covert response against Iran's drone strikes.
    • "They can pursue asymmetric attacks, cyberspace, and so forth," Petraeus said.
    • Saturday's drone strikes mark the first time Iran has directly attacked Israel. 

    A former CIA director says Israel could take a covert, rather than an overt, response against the Iranian drone strikes that took place on Saturday.

    "There's a whole menu of actions that they can take, not all of which are necessarily overt. They can pursue covert. They can pursue asymmetric attacks, cyberspace, and so forth," former CIA director and retired general David Petraeus told CNN on Sunday.

    "And keep in mind that, of course, Washington is meeting with the other G7 countries to determine what kind of diplomatic and economic responses should follow in a coordinated effort as well," Petraeus added.

    On Saturday, Iran launched an airborne attack against Israel and fired off more than 300 drones and missiles. Israel's military said it was able to intercept 99% of the munitions with the support of the US, UK, French, and Jordanian militaries.

    The attack, Iran said, was an act of retaliation for Israel's bombing of an Iranian diplomatic facility in Syria on April 1. The airstrike had reportedly killed several top Iranian military commanders. Saturday's attack marks the first time Iran has directly attacked Israel.

    "The matter can be deemed concluded. However, should the Israeli regime make another mistake, Iran's response will be considerably more severe," the Permanent Mission of the Islamic Republic of Iran to the United Nations wrote on X on Saturday.

    https://platform.twitter.com/widgets.js

    However, experts believe that it is unlikely that Israel won't respond to Iran's attack.

    "While Iran may now say that the issue is closed, it would be very surprising to see the Israelis not feel the need to respond, given the extent of the escalation," Carmiel Arbit, a nonresident senior fellow at the Atlantic Council think tank, told BI's Rebecca Rommen.

    To be sure, Israel is no stranger to covert operations in Iran.

    Back in 2018, Israel deployed agents from its intelligence agency, Mossad, to Tehran, where they took files from Iran's nuclear archive, per The New York Times.

    The same goes for Iran, who in January said they had attacked Mossad's headquarters in Iraq's Kurdistan region with ballistic missiles.

    The risk of a continued tit-for-tat between Israel and Iran has rattled investors, who fear that further escalation could disrupt the supply of oil.

    And that, Petraeus told CNN on Sunday, isn't something that Iran wants to see.

    "Iran, I don't think, wants to have that disrupted either because they export about 1.6 or 1.7 million barrels a day themselves," Petraeus said.

    "So, keep your eye on that. Brent Crude is already above $90 a barrel, and it would really spike if there was something that interfered with freedom of navigation," he continued.

    Representatives for Petraeus did not immediately respond to a request for comment from Business Insider sent outside regular business hours.

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