The Briefing by Martin Peers, Jessica Lessin and the team at The Information

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The Briefing

By Martin Peers, Jessica Lessin and the team at The Information

Get smarter about the day’s news in tech, media and finance by following Silicon Valley’s most-read executive newsletter.

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Recent Editions

Photos by Bloomberg

For Tech CEOs, ‘Challenging’ Means Dismal

By Martin Peers · Feb 2, 2023 5:00pm PST · 1 comment

Challenging! That’s the euphemism of the moment, used by way too many tech CEOs (including Tim Cook and Sundar Pichai tonight and Mark Zuckerberg and Evan Spiegel in recent days) to describe either 2022 or the current moment or both. Translated from corporate-speak into conversational English, it means business is bad. Just how bad became clear... Challenging! That’s the euphemism of the moment, used by way too many tech CEOs (including Tim...

YouTube CEO Susan Wojcicki. Photo by Bloomberg

Creator Economy

YouTube’s Ad Revenue Falls Again; More U.S. Pressure on TikTok

By Kaya Yurieff · Feb 2, 2023 3:30pm PST

A continued decline in YouTube ad revenue spells bad news for creators who earn money from the video-sharing site. On Thursday, Alphabet said YouTube’s ad revenue fell nearly 8% to $7.96 billion during the fourth quarter compared with the same period a year earlier. That’s the second straight quarter of decline. A continued decline in YouTube ad revenue spells bad news for creators who earn money from the...

Photo Illustration by Shane Burke. Photos by Getty and Shutterstock

Musk’s Twitter Scores Super Bowl Deals, a Boon for Struggling Ad Business

By Erin Woo · Feb 2, 2023 3:16pm PST

After weeks of turmoil and layoffs, Twitter’s sales team in recent weeks has reorganized to focus more on big advertisers and launch new ad products, such as its recently released digital confetti. Now Twitter faces its biggest sales test since Elon Musk took over the company: Super Bowl Sunday, historically Twitter’s... After weeks of turmoil and layoffs, Twitter’s sales team in recent weeks has reorganized to...

Photo via Getty

A New Bubble Is Forming for AI Startups, But Don’t Expect a Crypto-like Pop

By Kate Clark · Feb 2, 2023 1:44pm PST · 3 comments

Photo via Getty

A New Bubble Is Forming for AI Startups, But Don’t Expect a Crypto-like Pop

By Kate Clark · Feb 2, 2023 1:44pm PST · 3 comments

Venture capitalists have dumped crypto and moved on to a new fascination: artificial intelligence. As a sign of this frenzy, they're paying steep prices for startups that are little more than ideas. Thrive Capital recently wrote an $8 million check for an AI startup co-founded by a pair of entrepreneurs who had just left another AI... Venture capitalists have dumped crypto and moved on to a new fascination: artificial...

Illustration by Clark Miller.

Stop Paying People So Much

By Marcus Ryu · Feb 2, 2023 9:00am PST · 42 comments

Every startup leadership team wrestles with the trade-offs between growth and profitability. This is fitting and ever shall be. What teams don’t reflect on sufficiently is how a flawed compensation philosophy can make those trade-offs far more painful than they could be. As a former entrepreneur, I know that every venture relies on the... Every startup leadership team wrestles with the trade-offs between growth and profitability. This...

Verily headquarters in San Francisco. Photo by AP.

Revenues Rise at Alphabet’s Biggest ‘Other Bet’ But So Do Losses

By Jon Victor · Feb 2, 2023 6:00am PST · 2 comments

Verily, by far the biggest Alphabet unit by revenue after Google, continues to post heavy losses, according to previously undisclosed financial information. The results show just how far Verily is from standing on its own—a key goal of the Alphabet corporate structure created in 2015. Revenue at Verily, which tries to apply data... Verily, by far the biggest Alphabet unit by revenue after Google, continues to post heavy losses,...

Photo by Bloomberg

Meta Declares ‘Year of Efficiency’ as Revenue Stagnates

By Martin Peers · Feb 1, 2023 5:00pm PST

We’re in the middle of Chinese New Year celebrations at the start of the Year of the Rabbit. At Meta Platforms, though, it’s the “year of efficiency,” as CEO Mark Zuckerberg declared Wednesday on announcing fourth-quarter results. Investors such as Altimeter Capital, which last fall called on Meta to streamline, will be happy. It’s just a pity... We’re in the middle of Chinese New Year celebrations at the start of the Year of the Rabbit. At...

Cameo co-founders Steven Galanis, Devon Townsend, Martin Blencowe, from left to right. Photo by Michael Kovac/Getty Images

Cameo and Rally Shutter NFT Products, #Paid Conducts Layoffs

By Kaya Yurieff · Feb 1, 2023 4:30pm PST

Cameo co-founders Steven Galanis, Devon Townsend, Martin Blencowe, from left to right. Photo by Michael Kovac/Getty Images

Creator Economy

Cameo and Rally Shutter NFT Products, #Paid Conducts Layoffs

By Kaya Yurieff · Feb 1, 2023 4:30pm PST

I’m kicking off today’s newsletter with some news: Creator services from Rally to Cameo are ditching crypto features that generated lots of buzz during the pandemic. And another creator economy startup, #Paid, is cutting workers, I’m first to report, adding to layoffs hitting the sector. Let’s start with Cameo, the startup that connects... I’m kicking off today’s newsletter with some news: Creator services from Rally to Cameo are...

Stripe CEO Patrick Collison. Photo by Bloomberg.

Stripe’s Ill-Timed Crypto Re-Entry; SBF Needs to Stay Off Signal

By Aidan Ryan · Feb 1, 2023 4:13pm PST · 1 comment

My colleagues have been busy covering the latest at payments giant Stripe, which is in talks with existing investors that include Joshua Kushner’s Thrive Capital to raise $3 billion. Those talks are likely to value Stripe at $55 billion to $60 billion—a far cry from the $95 billion valuation it landed in its last funding round in early... My colleagues have been busy covering the latest at payments giant Stripe, which is in talks with...

Photo by Bloomberg.

Amazon’s No-Fly Zone: Drone Delivery Largely Grounded Despite Splashy Launch

By Theo Wayt · Feb 1, 2023 11:04am PST · 2 comments

Amazon in December announced with great fanfare that, after nearly a decade of work, it had finally launched drone delivery in the U.S., in two towns in California and Texas. But by mid-January, Amazon Prime Air had made deliveries to fewer than 10 houses, according to people who worked on the project. Despite what Amazon has said publicly about... Amazon in December announced with great fanfare that, after nearly a decade of work, it had...

Netflix Tells Advertisers Sign-Ups to Ad Tier Doubled in January

By Sahil Patel · Feb 1, 2023 7:00am PST

Netflix is making progress in its plunge into advertising—slowly. The streaming firm told advertisers in the past 10 days that new sign-ups for the tier with ads had doubled in January over December, a sign that low-cost offering was catching on with subscribers, ad executives say. Netflix didn’t tell advertisers how many sign-ups... Netflix is making progress in its plunge into advertising—slowly. The streaming firm told...

Photos via Adept Labs, Edmund Hillary Fellowship, Gantry ML, KIT Gründerschmiede, Sci Founders, Shutterstock, Stanford University, University of Central Florida, UC Irvine, UC Berkeley and YouTube.

OpenAI Is Making Headlines. It’s Also Seeding Talent Across Silicon Valley

By Jon Victor and Aaron Holmes · Feb 1, 2023 6:00am PST

Photos via Adept Labs, Edmund Hillary Fellowship, Gantry ML, KIT Gründerschmiede, Sci Founders, Shutterstock, Stanford University, University of Central Florida, UC Irvine, UC Berkeley and YouTube.

OpenAI Is Making Headlines. It’s Also Seeding Talent Across Silicon Valley

By Jon Victor and Aaron Holmes · Feb 1, 2023 6:00am PST

OpenAI has just 375 full-time employees, but its buzzy chatbot, ChatGPT, is shaking up Silicon Valley. The company’s influence extends even further, through former employees who are now in top positions at other artificial intelligence firms or have founded startups of their own. Even as layoffs roil the tech sector, AI talent is in high... OpenAI has just 375 full-time employees, but its buzzy chatbot, ChatGPT, is shaking up Silicon...

Thacker Pass, Nev. Photo: Courtesy Lithium Americas

The Electric: The New ‘Elephants’—GM Grabs the Biggest Lithium Deposit in the U.S.

By Steve LeVine · Feb 1, 2023 4:30am PST

For a century, the world’s oil drillers fought for rights to what they called “elephants,” supergiant oil fields in the Middle East, Central Asia and the U.S., because just one of them could make a company fabulously wealthy. Now global auto companies are scrambling for the new elephants—giant lithium deposits, which are emerging as a key to... For a century, the world’s oil drillers fought for rights to what they called “elephants,”...

Photo: Bloomberg

Creator Economy

Meta’s Resistance to Sharing Ad Sales Starts to Crumble

By Mahira Dayal · Jan 31, 2023 5:15pm PST

For at least a year, one question has hung over Meta Platforms-owned Facebook and Instagram: whether the apps will introduce a way to share a cut of ad revenues with more creators, similar to how YouTube pays video-makers. Our story today by Sylvia and Kaya goes deep into the debate at Meta over introducing ad-revenue sharing, which some staff... For at least a year, one question has hung over Meta Platforms-owned Facebook and Instagram:...

Snap CEO Evan Spiegel. Photo by Getty Images.

Snap’s Spaghetti Strategy Is Cause for Concern

By Jessica E. Lessin · Jan 31, 2023 5:00pm PST · 1 comment

Snap’s abysmal financial forecast for the current quarter continued the company’s string of rough news. While the social media company said revenues in the fourth quarter were largely flat from a year earlier, it warned that business is going to get worse. “Our internal forecast assumes revenue will be between -10% to -2% year-over-year in... Snap’s abysmal financial forecast for the current quarter continued the company’s string of rough...

Art by Shane Burke. Photo by Bloomberg

Musk Leaves Twitter Staff Without Equity Plan as Deadline Looms

By Erin Woo · Jan 31, 2023 1:40pm PST

Art by Shane Burke. Photo by Bloomberg

Musk Leaves Twitter Staff Without Equity Plan as Deadline Looms

By Erin Woo · Jan 31, 2023 1:40pm PST

Shortly after Elon Musk bought Twitter last fall, he promised Twitter staff that they could look forward to the kind of stock rewards employees at SpaceX—another private company Musk runs—enjoy. But as Musk’s ownership of Twitter nears the end of its third month, he has yet to release details of the new stock compensation plan,... Shortly after Elon Musk bought Twitter last fall, he promised Twitter staff that they could look...

Illustration by Getty Images.

The Relationship Model Is Killing Venture Capital

By Del Johnson · Jan 31, 2023 9:00am PST · 40 comments

The social and racial homogeneity of the venture capital industry has long been a source of frustration for entrepreneurs and investors alike. In recent years, this frustration has boiled over into a full-fledged movement, with a growing chorus of voices arguing that venture capitalists are destroying value by overlooking founders from swaths of... The social and racial homogeneity of the venture capital industry has long been a source of...

Illustration by Josh Brill

Meta Insiders Debate Key Issue for Reels: Whether to Share Ad Dollars With Creators

By Sylvia Varnham O'Regan and Kaya Yurieff · Jan 31, 2023 6:00am PST · 1 comment

When Wall Street analysts dial into an earnings call tomorrow with Mark Zuckerberg, they’re likely to pepper the Meta Platforms CEO with different versions of a favorite question: What’s the latest on making money from Reels, Meta’s answer to TikTok? It’s a delicate topic inside Meta. After three years of work on... When Wall Street analysts dial into an earnings call tomorrow with Mark Zuckerberg, they’re...

Stripe CEO Patrick Collison. Photo: Bloomberg.

Stripe in Talks to Raise Up to $3 Billion From Current Investors

By Jessica E. Lessin, Erin Woo and Cory Weinberg · Jan 30, 2023 5:08pm PST · 1 comment

Less than a week after telling employees that it would evaluate a public offering over the next year, payments giant Stripe is moving quickly on a deal to raise as much as $3 billion from its existing investors. The talks, which have heated up in recent days, are likely to value the company at between $55 billion and $60 billion, according to... Less than a week after telling employees that it would evaluate a public offering over the next...

Photos by Bloomberg

Stripe’s Trajectory Has Echoes of Uber; BuzzFeed’s AI-Fueled Rally

By Martin Peers · Jan 30, 2023 5:00pm PST

Photos by Bloomberg

Stripe’s Trajectory Has Echoes of Uber; BuzzFeed’s AI-Fueled Rally

By Martin Peers · Jan 30, 2023 5:00pm PST

Once upon a time, there was a private tech company that bankers thought could be worth as much as $120 billion when it went public. Its potential initial public offering was described in news reports like this one in 2018 as the “most hotly anticipated on Wall Street and Silicon Valley.” Today, it’s worth only about $60 billion. Can you guess... Once upon a time, there was a private tech company that bankers thought could be worth as much as...