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Theme: Bifurcation of valuations between defensible and fragile businesses, especially across the SaaS universe. Prediction: The standard deviation (i.e. dispersion of SaaS multiples) across public SaaS multiples will continue to increase over the next twelve months as investors double down on high quality and retreat from lower quality businesses.
Theme: Startups shutdowns and layoffs - another shoe to drop before normalization. Prediction: Layoffs and down-rounds accelerate for private SaaS startups, but overall funding (especially in growth/PE) increases dramatically over 2022/2023 volumes.
Theme: DPI takes center stage but the exit environment proves difficult.
Prediction: Private Equity M&A increases significantly over 2023 as firms chase DPI.
Theme: LLMs arms race intensifies as capital and talent consolidate further.
Prediction: The top LLMs (OpenAI, Anthropic, Mistral, maybe Gemini, 1-2 others) extend their lead, as non-market leading LLMs get caught in the middle then left behind.
Theme: GPU resellers - bifurcation of quality as market matures and GPU crunch eases.
Prediction: H100 prices drop over next twelve months and GPU resellers that don’t have product differentiation or scale advantages face acute headwinds.
Theme: Consensus continues to be wrong, expect the unexpected. Prediction: The U.S. enters a recession in 2024.