Scale AI: Whiz-bang Wang
As the American dream goes, it doesn’t get much dreamier than the tale of Alexandr Wang, the son of Chinese immigrants, who, four years ago, became the world’s youngest self-made billionaire at the tender age of 24.
He clearly came from good genetic stock — both his parents were physicists at the Los Alamos National Laboratory, home of the Manhattan Project in World War 2, and in his school days he starred in the maths Olympiad programme and the US physics team.
After the requisite brief appearance at the Massachusetts Institute of Technology, he dropped out to found Scale AI in 2016. The company’s valuation has rocketed to a perky $29bn, with Meta ponying up $15bn for a 49% stake and the chance to hire Wang to lead a new superintelligence team within Meta.
In the world of the acquihire, this is a significant bump up from the $650m Microsoft paid to Inflection and the $2.7bn Google paid to Character.AI, and it suggests that Mark Zuckerberg is going all in to catch up with ChatGPT.
Scale specialises in data labelling and AI evaluation, using a combination of technology and real live humans to mark up and review data that is used by other AI labs to develop their algorithms. Clearly not exactly lacking in self-confidence, Wang has been breaking bread with such world leaders as Donald Trump, Narendra Modi, Emmanuel Macron and Keir Starmer to discuss the future of AI. The deal with Meta “recognises Scale’s accomplishments to date and reaffirms that our path forward — like that of AI — is limitless”, says Wang.
Poundland: Pounded into submission
Meanwhile, at the other end of the valuation scale, discount retailer Poundland, which pioneered the concept of selling everything in the store at the easy to comprehend price of £1, has been sold for slightly less than that.
Its Warsaw-listed parent, Pepco, offloaded the retailer for a measly €1, and it is a reflection of the retail landscape that you can pick up a retailer with 825 stores, 16,000 employees and £1.7bn in sales for less than the price of a tube of toothpaste.
The proud new owner of the chain is Gordon Brothers, which specialises in distressed assets and has pledged up to £80m to support the company’s turnaround plan.
Rising costs forced Poundland to abandon its £1 price point, and an epidemic of brazen shoplifting, driven by the cost of living crisis and apparent police indifference, has tightened the pressure on the company. Pepco wrote down its valuation by £650m in December, and since then it has been racking up a slew of unpaid debts, largely to councils for business rates and to landlords for rent.
The restructuring, which is subject to approval in the high court, is likely to involve the closure of between 150 and 200 shops, a freeze on business rates payments and steep rent reductions.
It remains to be seen whether all this will be enough to ensure the chain’s survival in a fiercely competitive market, with Aldi and Lidl muscling in on the lower levels of the food chain, and there’s a chance that Gordon Brothers’ purchase will turn out to be something less than a bargain.
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