PE Associate

I share tips, humour and commentary about my experience as growth / private equity investor at mega fund

[PE Associate @PE_Associate]

I posted the other day that senior leaders in finance have already made their money and don’t care enough anymore to still be in the detail. Here is the perfect example. Hero to many (including myself) uncritically trusting the results of a probabilistic LLM. I see this a lot at my fund as well, sad to see

[Daniel S. Loeb @DanielSLoeb1]

@Parag_Oilman 🤷🏼‍♂️ blame Claude. Thx for your perspective.

[PE Associate @PE_Associate]

@HighyieldHarry Completely agree

[PE Associate @PE_Associate]

@ClareONeilMP So then introduce an inheritance tax. Why make it impossible for people to get ahead in their life times?

[PE Associate @PE_Associate]

@GeddesLiza @taxinator @oceanblue76547 I think this list is completely fake. Milan and Switzerland missing is the tell

[PE Associate @PE_Associate]

@kylekuzma @litcapital

[PE Associate @PE_Associate]

@kylekuzma This is the craziest thing I’ve ever seen in my life

[PE Associate @PE_Associate]

@nic_carter I just want to say that there is no AI model today that can create sophisticated LBO models. I can’t challenge the other pieces because I’m not experts on those things but complex LBO models they cannot do

[PE Associate @PE_Associate]

@B3nL1pman @spitspinner @BoringBiz_ How can he lose money when his cost base is so low

[PE Associate @PE_Associate]

+ adding to this, a fed hike will also bring the show to a halt. I’m not sure what they can do against this inflation backdrop. We’ve already learned that inflation is not transitory…

[PE Associate @PE_Associate]

Calling it now so it’s on the record for this account. I cannot see any scenario where we aren’t on track for a severe market correction. Absolutely peak NTM earnings multiples layered on top of peak earnings which are structurally non-recurring and financed by primary equity / debt (rather than an organic earnings base). Not sure what the catalyst will be (maybe systemic risk in private credit or maybe Iran) but I really believe we are either at or close to the top of an equity market that will implode.

[PE Associate @PE_Associate]

@sxhealth101 Actually those are just investment banking analysts you are seeing, think you have gotten the two mixed up

[PE Associate @PE_Associate]

@clay_phi @haider1 How?

[PE Associate @PE_Associate]

@clay_phi @haider1 “This guy” is the modern forefather of LLMs…basically everything you see today is built on top of his research (which he won a Turing prize for)

[PE Associate @PE_Associate]

@staysaasy Was going to say, even without AI those roles are all getting shifted offshore

[PE Associate @PE_Associate]

@mil000 That’s not how prenups work. You carve out assets (i.e. my stake in Kalshi) not $ value pre cap gain

[PE Associate @PE_Associate]

We run a rolling internship program and we genuinely had an intern come in and use the Claude Excel plugin on the live version of a live deal model (they were just asked to add some data to a data sheet at the back). It deleted the data sheet driving the model to create a new one (which cannot be undone) so the team had to go back a version…

[PE Associate @PE_Associate]

The key word here is “potential”. It is so easy to pilot a product and conclude there are massive potential efficiency gains based on a user survey. It is so difficult to ever achieve those gains. There isn’t a single PE portco that I’ve heard of where AI is driving real improvement

[PE Associate @PE_Associate]

@BlueyAnon @litcapital 😂😂😂 all time

[PE Associate @PE_Associate]

@ar0cket1 @giffmana Can you explain your view a bit more? I thought the original point that this is evidence that RL transfers / generalises was sensible so keen to understand why you think it’s so obviously wrong

[PE Associate @PE_Associate]

@justintime277 @giffmana @BoringBiz_ Google gets paid on a per click basis and Google search revenue is up 19%…

[PE Associate @PE_Associate]

This doesn’t explain why revenue would go up though. Google ads run on fixed daily budgets at the customer level. So for revenue to go up by 19% (lower on a CC basis), total customer budget would have to increase by 19% (which can really only happen if Google is delivering double digit % more end market sales through its ads). It isn’t obvious to me that any form of current AI can explain that