Softbank bets on OpenAI, the era of computer cars and what matters in the market – 10/01/2024 – Market

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Softbank, OpenAI’s new partner

The Japanese investment group SoftBank, known for its risky investments in startups, is planning to invest US$500 million (R$2.47 billion) in OpenAI, creator of ChatGPT.

This amount is just a part of the US$6.5 billion (R$32.13 billion) that the AI ​​(artificial intelligence) company seeks to raise in the market. The information was released by the website The Information.

Expansion. At OpenAI, the objective is to use the money to grow and maintain leadership in the sector, distancing itself from competitors like Google.

Weeks ago, the company launched a new AI model, which promises to “reason” about complex topics. I explained it in this edition of the newsletter.

SoftBank. In the Japanese group, investment in technology has grown, being seen as a more certain way to achieve returns.

The group has two large venture capital funds: Vision Fund 1 and Vision Fund 2. Understand the terms of the startup universe here.

Some investments made in the golden years of startups, until 2022, seemed to have great prospects for the group, but resulted in losses.

↳ One of the cases was the coworking company WeWork, which received billions from SoftBank, reached a market value of US$47 billion (R$231.02 billion), but is now facing a crisis.

Interests. The fund’s entry into OpenAI is seen as strategic to support another startup with money from Softbank, chipmaker Arm Holdings.

SoftBank is also reportedly interested in an OpenAI physical device project, which is being developed in secret by former Apple designer Jony Ive.

↳ Until now, Japanese funds had not invested in OpenAI, but rather in one of its competitors, Perplexity.

Assessment. With the investment, OpenAI aims to reach a market value of at least US$150 billion (R$737.9 billion), consolidating itself among the trio of most valuable startups in the world.

Currently, the market value of the most valuable startups, according to CB Insights, is:

• 1st place: ByteDance, owner of TikTok, estimated at US$225 billion (R$1.11 trillion);

• 2nd place: SpaceX, with US$200 billion (R$983.9 billion);

• 3rd place: OpenAI, valued at US$80 billion (R$393.5 billion).

Capture. The round is expected to be led by Thrive Capital, with participation also from Microsoft, one of the company’s first investors.

Apple was among the possible investors, but, according to the Wall Street Journal, the company had withdrawn from the investment.

Turbulences. The billion-dollar fundraising comes amid a reorganization at the company that created ChatGPT.

CEO and founder Sam Altman is consolidating his power with allies on the board after suffering a coup in 2023 and soon being reappointed.

In recent months, some of the founders and former employees have left the company. The most recent departure was that of director Mira Murati.

Dollar rises, but falls

The dollar closed slightly higher this Monday (30), at R$5.448, but ended the month of September lower, devaluing 3.28%.

Among the reasons for the rise on the day are the greater demand typical of the last trading session of the month and the uncertainty about the fall in interest rates in the United States.

Opposite signs? The American currency lost strength globally in September after the United States central bank cut interest rates as data showed a slowdown in inflation in the country.

Interest rates fell from the range between 5.25% and 5.50% to the range between 4.75% and 5%.

Yes, but… The institution’s president, Jerome Powell, signaled this Monday that the rate of interest cuts should not remain at 0.50 percentage points in future decisions. The result was an appreciation of the dollar.

Data from the American labor market, to be released next Friday, should help adjust these expectations.

Understand: the dollar tends to fall as interest rates in the United States also fall, as the return on investments linked to American fixed income decreases.

This leads operators to withdraw investments there and seek better returns, including in emerging countries like Brazil.

Will it fall more? The price of the dollar is also influenced by internal factors in Brazil.

High interest rates here, in theory, should strengthen our currency even further, but signs of accelerating inflation and concerns about public accounts are seen as obstacles.

Car, your new computer

Car brands have shifted their focus on technological innovation in recent years. Instead of engines, it is car software that now receives investment.

Electric and hybrid models, as well as 5G internet networks, have paved the way for vehicles that are more like computers.

Understand: In addition to improving basic functions, software can generate more revenue from collecting user data and subscription services.

Today, these services generate around US$300 million (R$1.6 billion), or 3% of automakers’ global revenues, according to consultancy Accenture.

↳ The value could reach US$3.5 trillion (R$19.3 trillion) in 2040, representing almost 40% of revenues.

Technological race. In this dispute for the vehicle of the future, large manufacturers have lagged behind in the development of digital systems.

A survey by consultancy Gartner shows that only three traditional automakers — Ford, GM and BMW — are among the top ten in this area.

The segment is dominated by the Chinese companies Nio, Xpeng and BYD, as well as Americans such as Tesla, Rivian and Lucid.

↳ Elon Musk’s automaker was the pioneer in creating a driving proposal integrated with software, which assists the driver with autonomous driving and accurately analyzes the car’s conditions.

↳ This week, BMW launched a new SUV model that promises advanced driving modes and even remote control via cell phone. THE Sheet tested the steering.

Difficult task. A report from the Financial Times points out that one of the challenges for automakers is cultural, in addition to financial return.

Companies have had to absorb talent from startups and large technology groups, such as Apple and Google, which causes internal clashes.

Goldman Sachs analysts estimate that the cost of developing an operating system for vehicles is at least US$11 billion (R$60 billion).

See below the status of some initiatives:

Toyota. The Japanese automaker created a subsidiary, called Woven, and has been struggling with losses totaling US$888 million (R$4.9 billion) in the last two years.

The hiring of former Google executive James Kuffner as the group’s senior advisor is a bet to ensure the launch of its new software in 2025, called Arene.

Volkswagen. The German giant decided to resort to a billion-dollar partnership with the American Rivian after facing problems in its internal software unit, called Cariad.

Volvo. In the case of the Swedish company, owned by the Chinese Geely, an electric SUV with its own software and Nvidia chips was launched, but delays in development led the company to create a simpler version than desired.

Career tip

Sustainability on the rise in the job market

The climate crisis that hits the world with high temperatures, droughts and extreme rains mobilizes the public and private sector to hire specialists in the area.

Concern for the environment opens up space in the job market for professions related to sustainability.

This week’s FolhaCarreiras newsletter explains the activities of five areas that are experiencing a positive moment in Brazil:

↳ They are: environmental engineering, environmental management, urban planning, soil and renewable energy specialists.

↳ Salaries vary, but the average at the beginning of a career can reach R$10,000.

Where to graduate: professions, in general, require higher education and/or specialization. There are undergraduate courses focused directly on engineering and environmental management, for example.

Urban planning careers, soil and renewable energy specialists accept training from other areas, being multidisciplinary.

In these cases, postgraduate studies, open courses and the experience itself on the CV help to train the professional. See more details in the edition.