Hi All,
Welcome to our brief overview of portfolio news from the past few days.
Meta Partners with Blue Owl for Data Center Financing
Meta Platforms has entered into a joint venture with funds managed by Blue Owl Capital to develop and own the massive Hyperion data center campus in Louisiana. Blue Owl funds will own 80% and contribute approximately $7 billion in cash, while Meta retains 20% ownership and contributes land and construction assets previously held for sale. Meta will manage the construction and operation, leasing the facilities back under a four-year initial term with extension options.
Partnering with an infrastructure investment expert like Blue Owl allows Meta to spread the significant capital investment (approx. $27 billion total cost) and risk associated with building the massive infrastructure required for its long-term AI ambitions. It also represents efficient use of assets previously held for sale.
LVMH Reportedly Considers Fenty Beauty Stake Sale
LVMH is reportedly exploring the sale of its 50% stake in Fenty Beauty, the cosmetics brand co-owned with Rihanna, potentially valuing the brand between $1-$2 billion. Fenty Beauty logged $450 million in net sales in 2024.
While Fenty Beauty had a strong launch ($550 million sales in first 15 months - by the end of 2018) and reportedly doubled revenue in 2022, the 2024 sales figure suggest a downtrend. The lower valuation of what was initially estimated to worth around $2.8 billon also implies slower growth than expected. LVMH’s potential exit aligns with our investment thesis: focusing resources on its core portfolio of iconic, enduring luxury houses rather than potentially more trend-driven, celebrity-anchored brands.
OpenAI Launches “Atlas” AI Browser
OpenAI unveiled ChatGPT Atlas, a new AI-powered web browser built around a conversational interface and agentic capabilities. Atlas allows users to chat directly with websites and automate tasks like filling forms. The launch immediately puts OpenAI in competition with other AI browsers and presents a new challenge to Google’s dominance in search and browsing.
While the announcement contributed to a dip in Google’s stock price, it reinforces the strategic importance of the browser as the gateway to search. Google is currently ahead in integrating generative AI directly into Search (AI Overviews, AI Mode) while Atlas’s key differentiator appears to be its “Agent Mode”. However, such agentic capabilities may face regulatory scrutiny around data privacy and security, as current AI models often have limitations on interacting with external sites and handling personal data.
Here’s how AI Mode responded when we asked it to fill out a form for us:
“No, you cannot delegate online tasks like filing a form to me or any other AI assistant. I cannot access or interact with external websites and online systems, and I cannot handle, store, or transmit personal and sensitive data like the information on a form. This is a fundamental security and privacy limitation built into my design.”
Evolution vs. Playtech Legal Battle Escalates
Evolution intends to add Playtech as a defendant in its ongoing defamation case related to a 2021 report allegedly commissioned by a Playtech subsidiary, which reportedly paid Black Cube £1.8 million to produce it.
Playtech denies that the report was part of a “smear campaign” but confirmed it commissioned an investigation into concerns regarding Evolution’s activities. However, the report’s anonymous origin and the use of covert tactics over four years, including secretly recording conversations, raise questions about Playtech’s true intent.
In our view, this was an attempt to divert Evolution’s focus toward legal matters rather than the lucrative live casino market. Despite this, Evolution has continued innovating and remains the clear market leader. Playtech now faces potential damages.
Other Industry & Portfolio Updates
Amazon Web Services experienced a significant outage in its US-EAST-1 region, causing widespread disruption before services were restored. The incident highlights AWS’s critical role in internet infrastructure but also underscores the risk for Amazon, as outages can prompt customers to diversify their cloud providers, even partially.
Waymo School Bus Probe: The US National Highway Traffic Safety Administration (NHTSA) opened a preliminary investigation into Waymo after a report that one of its vehicles failed to properly yield to a stopped school bus. Waymo stated it has already implemented software improvements. While negative news, incidents like this are expected during the complex rollout of autonomous technology.
PayPal is increasing its investment in German e-commerce platform Shopware, raising its stake from ~11% to ~41% by acquiring Carlyle Group’s stake. A PayPal representative confirmed the agreement, calling Shopware a “longtime and important partner in Europe”. This move aligns with PayPal’s strategy to embed itself more deeply within the e-commerce infrastructure, expanding its role beyond just payment processing.
That’s a wrap. See you soon.