Contrary Research Rundown #16
Predictions for 2023, and new memos on Rippling, Plaid, and more
Research Rundown
Welcome to the new year! In 2022, Contrary Research launched over 60 memos and 5 deep dives on companies across industries like data infrastructure, fintech, DevOps, AI/ML, and cybersecurity. In 2023, we're excited to dramatically broaden our coverage of private tech companies, and continue to explore the most important industries shaping the world today.
Starting out the new year, we took a look at some of the predictions top founders and VCs are talking about. What's top of mind for everyone?
AI continues to take up a lot of mindshare. For some people, it's obvious that we're just getting started. 2023 will make 2022 look like a pretty sleepy year for AI in comparison. For others, they can't help but draw parallels between the hype in AI and the bubbles of 2021 with things like web3, and the metaverse. ChatGPT continued to draw people's excitement. We dug in and thought through the cost implications for an app like ChatGPT getting to 1M+ users in their first five days.
In the world of SaaS, it's been a painful twelve months. And a lot of investors aren't expecting it to get much better this year. Tech companies will likely continue to see multiple compression in the public markets, as valuations continue to drop private companies will likely be forced to raise capital at less-than-ideal terms, and the combination of customers cutting down seat counts, and pricing pressure will make it even more difficult for software companies to execute and maintain exceptional growth.
As we look forward to the new year, we've got a lot planned. Digging in to the democratization of design and the citizen creator movement, the fate of crypto hanging in the balance, wrapping up the second half of our cybersecurity series, and a whole lot more! Looking forward to digging in with all of you.
Guild Education is an education-as-a-benefit company which gives employees access to a marketplace of vetted degree programs and certificates to help employees upskill and reskill. Read our full memo here.
Hadrian is building factories to manufactur precision parts for aerospace and defense companies in an effort to accelerate the pace of American manufacturing by delivering parts in less time, and on time. Read our full memo here.
Flutterwave is an API for processing payments that seeks to solve the problems that currently afflict Africa’s payments ecosystem by building seamless and secure payment infrastructure. Read our full memo here.
Plaid has built a widely-used abstraction layer that provides seamless integration for developers of financial apps to connect to banks, and other financial service providers. Read our full memo here.
Rippling is all-in-one platform for HR, IT, and payroll processes. Rippling believes employee data should be a business's core, creating a single system across departments within every company. Read our full memo here.
While everyone has been talking about OpenAI and ChatGPT, the company has been busy putting together a fundraising round that would value the company at $29 billion. Microsoft is already a large investor, and recently announced that they would be leveraging ChatGPT to level-up their search engine -- Bing.
We often talk about the world of defense, having written about companies like Anduril and Hadrian. One of the most prolific investors in defense tech is Josh Wolfe at Lux Capital. This week, The Information unpacked his investment thesis and why he's looking to accelerate the defense-tech race.
One category that is closely aligned to defense is aerospace. We've written before about SpaceX, and they had a big week this week. In the market for secondary shares of highly valued private companies, we've seen demand for businesses like Stripe, Bytedance, and Epic Games collapse. One of the only companies that seems to still be drawing significant interest? SpaceX. On the back of a recently announced partnership with Impulse Space for last-mile space delivery, the company announced they were raising a $750 million round at a $137 billion valuation.
Aerospace and defense aren't the only sectors continuing to ride strong tailwinds. In the world of data infrastructure we've written about how giants like Databricks and Snowflake are increasingly starting to clash, as both vie for the right to be the center of gravity for every customer's data. Over the holidays, Ari Kaplan announced he was joining Databricks as their first dedicated Head of Evangelism. The race for data mindshare continues to heat up!
Contrary Research Fellowship
At Contrary Research our vision is to cover hundreds of companies. We can't do it alone, nor would we want to. We focus on bringing together a variety of different perspectives.
That's why we're opening applications for our Research Fellowship. In the past we've worked with software engineers, product managers, consultants, and more. If you're interested in researching and writing about tech companies, apply here!