Contrary Research Rundown #80

Every business an ads business; plus new memos on Figma, MoonPay, and more

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Research Rundown

In the dot-com bubble you had dozens of companies selling everything from palm pilots to online groceries to digital currencies (pre-Bitcoin, thanks to Whoopi Goldberg). Advertising wasn’t nearly as prevalent as it is today. Jeff Bezos even famously said “ads are the price you pay for an unremarkable product or service."

To be clear, advertising isn’t new. But as the consumer internet really took off in the early 2000s, with Google, Facebook, Reddit, Twitter, and all your favorites, advertising became THE de facto method of monetization.

Since the dominance of ad-driven models over the last decade or so, you’ve seen a number of companies get built around the idea of breaking out of it, and bringing “freedom to the internet.” Skiff wanted to free us from Gmail. Neeva wanted to free us from Google Search. Both were less than successful, and ultimately acquired.

Today, people have been touting AI chat tools, like Perplexity as the “first legitimate threat to Google’s search supremacy.” Perplexity made its stance known right on its website, that search should be “free from the influence of advertising-driven models.” A line that, just within the last month, was removed from Perplexity’s site.

I’m sure it’s just a coincidence, but right after that line was removed from the site, Perplexity shared that the company would start selling ads. Perplexity’s Chief Business Officer, Dmitry Shevelenko, even said, “advertising was always part of how we’re going to build a great business.”

The unavoidable weight of gravity that is advertising revenue has once again proved too much to resist. Even Amazon, again famously, once it started building its advertising business, grew that business unit to $46 billion in 2023 revenue. And Perplexity isn’t the only one jumping on the band wagon.

Discord, whose CEO had consistently said for years that ads would be too intrusive on the platform, has now announced plans to start selling ads. Even Apple is upping its game. Apple already has a sizable ads business, not to mention its massive $18 billion deal to keep Google the default search engine on Safari, which is basically one big Google ad. But now, Apple is doubling down. The company recently announced plans to offer an ad network across its network of devices.

As companies like Perplexity live up to the AI hype, or Discord looks at a future IPO, or Apple confronts the reality of stagnating smart phone sales, everyone is looking for that silver bullet. And for all of them, advertising is likely to continue to be the answer.

Figma is a cloud-based design tool that offers collaborative features, facilitating real-time work on user interface designs. To learn more, read our full memo here and check out some open roles below:

• Product Engineer - San Francisco, CA, New York, NY, Seattle, WA

• Software Engineer, Growth - San Francisco, CA, New York, NY, Seattle, WA

MoonPay is a product that allows users to more easily convert their fiat currencies into digital assets. To learn more, read our full memo here and check out some open roles below:

• Cloud Security Engineer - New York, USA

• Senior Full Stack Engineer - New York, USA

Autograph is a platform that brings together “icons” (i. e. celebrities) in sports, entertainment, and culture to create NFT-based digital collections and NFT-enabled experiences for their fans. To learn more, read our full memo here.

Check out some standout roles from this week.

• Kojo | United States, Canada - Backend Engineer, Integrations, Software Engineer, Office, Sr. Frontend Engineer, Vendor, Data Science Lead, Analytics and Business Intelligence

• Lithos | United States, Remote - Founding Product Engineer, Data Scientist, Agriculture or Geospatial

• Regrello | United States, Remote - Software Engineer, Frontend, Machine Learning Engineer, Machine Learning Scientist, Senior Software Engineer, Backend

• Hannu Rajaniemi, the CEO of HelixNano, posted a manifesto on building a “immune-computer interface (ICI),” comparing the way language, writing, and computers augment our brains, and how we could do the same for our immune systems.

• Sarah Tavel published a blog post pushing back against the claim that AI favors the incumbents and describes, instead, how companies like MidJourney, DeepL, ElevenLabs, and HeyGen are breaking out by offering a 10x better experience than anything else.

• DoNotPay recently announced that it had paid a $1 million dividend to employees and investors. The company has only 7 employees, and has more cash on its balance sheet than the $24 million it has raised in funding.

• In a piece from The Financial Times, Demis Hassabis, the co-founder of DeepMind, has indicated that “the surge of money flooding into artificial intelligence has resulted in some crypto-like hype that is obscuring the incredible scientific progress in the field.”

• Guild Education has announced that Bijal Shah has taken over as CEO for Rachel Romer who, the company recently disclosed, had recently survived a stroke.

• Kalshi recently announced that Susquehanna International Group has become the first institutional investment group to build a trading desk around “event contracts,” working with Kalshi to be a market maker for event-based betting.

• Ghost Autonomy, a startup building autonomous driving technology, which previously $220 million from firms like OpenAI, announced that it is shutting down.

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