Our 2024 Predictions

Introduction: Overview of the podcast focusing on Commerce Ventures' annual prediction season. Discussion on examining the outcomes of 2023 predictions and their implications for 2024. Review of 2023 Predictions: Buy Now, Pay Later (BNPL) Implosion: BNPL usage remains high, defying expectations of implosion. Resilience noted despite economic challenges. Acknowledgment of misjudgment on BNPL providers' performance. Consumer Balance Sheet Resilience: Surprising resilience in consumer balance sheets. Delinquencies did not rise as anticipated. Challenger banks found ways to adapt to challenges. Private Equity Roll-Up of D2C Retail Darlings: Lack of roll-up activity observed, challenges faced by some. Economic factors and unexpected rate changes influenced outcomes. Crypto's Persistence: Predicted crypto persistence in 2023. Acknowledgment of a cold year for crypto. Recent uptick in Bitcoin's value impacting the prediction. Mass Merchants vs. Luxury Performance: Luxury sector booms, mass merchants face headwinds. Economic environment affects both sectors, with some deviations from expectations. Incumbents Acquiring Venture-Backed Payments Companies: Successful prediction with Visa's acquisition of Pismo. Expectations for more acquisitions in the future. Skyrocketing Consumer Borrowing Impact: Mixed outcomes with parts of the prediction playing out. Opportunities in credit servicing and data space observed. Venture Funding Bottoming Out: Acknowledgment of being off on the timing. Return of scrappy founders observed in the market. Venture Funding Continues to Fall: Scrappy founder mentality due to funding challenges. Adaptation to scarcity of venture dollars. Retailers Invest in Automation: Confirmation of retailers investing in automation. Emphasis on AI's role in shaping the future of retail. Outlook for 2024 Predictions: AI Impact on Retail P&L: Prediction of AI-driven OpEx reductions at major retailers. Anticipation of actual impact on P&L. Consumer Adoption of AI: Optimistic prediction of a significant number of Americans using AI daily or weekly. Examples from platforms like TikTok influencing AI adoption. M&A Surge in 2024: Anticipation of increased M&A activity in the first half of the year. Factors include scale, revenue generation, and potential market closures before elections. Crypto Market Resurgence: Prediction of a crypto market run-up in 2024. Factors include legal actions, regulatory clarity, and market sentiment. Bank Industry Dynamics: Expectation of a bank collapse or acquisition due to challenges in commercial real estate. Potential impacts on the broader financial services landscape. Chime IPO and Retail Market Response: Prediction of Chime's IPO and subsequent market reactions. Expectation of retail market emulation of successful models like SheIn. Challenger Banks IPO Filings: Anticipation of IPO filings by large challenger banks. Questions about business model viability and profitability. Interest Rate Changes: Expected sequence of events leading to interest rate reduction. Impact on lending and capital requirements for banks.