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Deep | Connections
The Wall Street Skinny
January 30, 2025
This Week on The Floor
We are finishing up an amazing week at the iConnections MFA Global Alts Conference, the largest capital introduction conference in the world.
We’ve had an unparalleled opportunity to connect with thought leaders in the industry these past few days, and will be sharing our interviews with some of the world’s biggest investors and celebrities this coming month.
On a more somber note, we’ve read reports in the news of the death of another junior investment banker. We share our thoughts in today’s newsletter.
DeepSeek and the problem with risk concentration
GlobalAlts recap
Enough is enough: another death in Investment Banking
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Markets Recap / Deal News
Interviewing this week? Here’s some content for your conversation.
Earlier this week, equity markets were thrown into turmoil when DeepSeek, a Chinese AI startup, launched its latest model: DeepSeek R1.
Why the panic?
Well, DeepSeek R1 is reportedly on par with OpenAI’s ChatGPT, but built for a fraction of the cost.
For context: while OpenAI’s GPT-4 cost around $100mm to develop, DeepSeek claims their model cost just $6mm.
While there’s some skepticism around the true magnitude of the difference, experts verified the capabilities of the model to be equivalent or superior to many of the other large language models (“LLM”s) in use, making its low development cost even more remarkable.
It took a few days from initial release to market impact, as developers needed time to access and test DeepSeek’s capabilities before drawing conclusions.
But by Monday, companies like Perplexity had verified DeepSeek, and legendary tech founder and venture capitalist Marc Andreessen called it “one of the most beautiful innovations I’ve ever seen.”
That endorsement catapulted DeepSeek into the spotlight and confirmed it wasn’t just a knockoff.
The implications?
DeepSeek proves that AI models can be developed at a fraction of the cost, lowering barriers to entry, leveling the playing field, and reshaping the tech landscape.
One of the most notable elements of this breakthrough is that DeepSeek R1 is open source. Companies don’t need DeepSeek’s infrastructure; they can simply download the code, customize it, and run it on their own systems.
The impact?
Massive fallout for companies that provide infrastructure and hardware — the “picks and shovels” for the AI gold rush — like Nvidia.
NVDA this week (Source: Yahoo! Finance)
Nvidia was down 17% intraday, erasing $600mm in market cap as investors questioned future demand for expensive CPUs.
If AI models become less compute-intensive, the need for major energy infrastructure buildouts (like massive data centers) could also slow. As a result, utilities and energy stocks were down on the news.
DeepSeek’s emergence isn’t just a technological breakthrough.
It’s a reminder that the rules of AI development are being written and re-written in real-time.
Inside track at the world’s largest capital introduction conference
This past week, we’ve had the opportunity to take part in iConnections MFA Global Alts, the world’s largest capital introduction conference.
It’s a 3-day event that combines exclusive content from industry thought leaders and in-person meetings between allocators (a.k.a., institutions with capital) and funds (investors seeking it).
To give you a sense for the scope of the event, Kristen’s husband (who is a hedge fund marketer) had 36 back-to-back meetings over the course of two days.
Here’s what your girls at The Wall Street Skinny were up to…
Day 1
We arrived in Miami on Monday afternoon and joined our friends for a welcome event that included many of our former podcast guests, like Guy Adami and Dan Nathan (stars of CNBC’s Fast Money), Ted Seides (host of the Capital Allocators podcast), and Steve Kurz (co-founder of Galaxy), as well as Kimbal Musk, Eli Manning, and Maurizio Umansky (you know how obsessed we are with RHOBH!).
Day 2
We hustled to connect with as many industry thought leaders as possible, first hosting a red carpet podcast to get hot takes from speakers as they came off the main stage. W
We interviewed star NFL quarterback Eli Manning (despite being Patriots fans ourselves) and sports/real estate investor David Adelman (part-owner of the Sixers for all you Philly fans). We chatted about the intersection of sports and investing, as well as the actual business of sports investing.
We spoke with Aaron Cowan, head of Suvretta Capital, about how the 80s are back for hedge funds, Ted Seides about themes for private markets in the coming months, and representatives from Japan’s biggest pension funds about the massive opportunities emerging with Japanese capital.
We also got to reconnect with TWSS bestie Keri Findley to catch up on the massive growth of her fund Tacora and follow up on our podcast episode about the Asset-Based Lending side of Private Credit.
On the main podcast stage, we recorded full-length interviews with two legendary Princetonians: Karen Karniol-Tambour, the CIO of Bridgewater, and Pete Muller, legendary quant trader and musician.
Karen is a brilliant force of nature as one of the most powerful women on Wall Street AND an inspirational mother, joining us after speaking at Davos the day prior and jetting home that same afternoon to tuck her kids into bed.
Pete built a powerhouse prop trading group within Morgan Stanley before spinning off into his own fund, where he made headlines as one of the highest-paid hedge fund managers in 2019 with earnings of $150mm. He’s also a touring musician with his own band and an accomplished crossword puzzle creator (!)…we cannot WAIT to release these episodes.
Day 3
We hit a slight hiccup when Kristen came down with the flu, but Jen managed to hold down the fort, and had the opportunity to interview thought leaders in the crypto space like Marco Poblete, founder of Vinter, and Antony Kettle from RBC Asset Management’s emerging market credit investing team.
One of our coolest conversations was with Dr. Mona Hamdy from Anomaly, who spoke about the power of female crypto investors in the Middle East and the human ethics of crypto investing.
And one of the most unexpected joys of our trip was our partnership with Cadillac, who graciously provided us with not only a car but our new best friend and driver, “Chicago Joe” — our personal MVP of the conference!
Kristen’s husband and his coworkers were kind enough to let Jen crash their dinner before the Diplo concert (yes, there’s a photo of me floating around with Diplo somewhere).
Day 4
Closing out the conference, Jen had the opportunity to interview the CEO of iConnections (and TWSS fairy godfather) Ron Biscardi, alongside Juan Sabater, co-President and Partner at Valor Equity Partners, about the art of relationship building when it comes to raising capital and building businesses.
We cannot wait to share all this amazing content with you over the next month or two in our newsletter, on our social media, and of course, on our podcast. Stay tuned!!
Not Again…
When we first watched episode one of Industry, where a new Investment Banking analyst literally works himself to death, I remember thinking: “this is just Hollywood…there’s no way real life is that extreme.”
And then reality hit me — I had to check myself, because it is happening in real life.
And it has to stop.
This week, we’re reading yet another article about the death of an overworked young professional. Last year we heard about this happening to two Bank of America associates. Carter McIntosh, who passed away this week, worked at Jefferies.
While we don’t know any specifics, there has been widespread indictment across various social media forums of the working conditions that may have contributed to this young man’s passing.
Clearly, policies at the corporate level aren’t enough.
The issue isn’t just about rules — it’s about culture. Specifically, a culture that glorifies burnout, rewards overwork, and normalizes sacrificing mental and physical health.
That culture has to change.
We honestly don’t know what else to say at this point except: it has to stop. Lives are being lost, and it’s heartbreaking that we’re still having this conversation.