 |
|
|
|||||
For decades, women business owners have faced a persistent challenge: access to capital. Despite owning nearly half of all small businesses in the U.S., women often encounter barriers to financing. Ive seen from my experience at the SBA and now First Women’s Bank, that one of the biggest drivers of the gender lending gap isnt just rejection, its that many women dont come forward for financing at all. Whether due to lack of awareness, confidence, or systemic hurdles, access captures both those who are denied and those who never apply. Also driving the gender lending gap is the type of capital women seek. Women often seek startup capital that is difficult to obtain, rather than growth and acquisition capital. Especially pronounced is the lack of acquisition financing in the womens economy. Women are starting businesses at twice the national average, yet based on my experience, the number of women engaged in financing business acquisitions versus startups is relatively low. That matters because when women choose to bootstrap startups and grow organically rather than acquiring an existing business, they are choosing the long road to success. Business acquisitions can be a powerful shortcut to scale. Starting from scratch means building infrastructure, cash flow, and customer relationships, one step at a time. Acquiring an established business gives you all that on day one, plus brand equity and proven operations. Its a way to bypass early-stage risk and accelerate growth by leveraging whats already working. SBA LOANS AND REAL ESTATE And back to the issue of access to capital. A startup, from a banks perspective, can be risky to finance and difficult to underwrite as the bank can only review projections. Financing an acquisition can be more achievable, as the bank can underwrite the acquisition targets past business performance. SBA 7(a) loans are a strong financing option for business acquisitions, and combining an equity raise with SBA financing is yet another strategy that can create a healthy debt-to-equity structure and lower the debt burden for the business post-acquisition. Financing the acquisition of owner-occupied real estate, or in other words, acquiring real estate for your business to operate from, is another underutilized strategy in the womens economy. Real estate assets can strengthen your balance sheet by adding real estate collateral, which can be used to secure future growth financing. Real estate ownership can stabilize expenses, eliminate landlord restrictions, and build long-term control and consistency. Over time, these assets dont just support operations; they enhance your business value to your banks and investors. For owner-occupied real estate acquisition, SBA 7(a) and 504 loans can offer lower down payments for those who qualify. ACQUISITION FINANCING TO CLOSE THE GAP Strategic acquisition financing can lead to women controlling more assets, gaining negotiating power, improved financing terms, and the ability to reinvest in their companies and communities. Financing the acquisition of both business and real estate assets creates a virtuous cycle of empowerment, growth, and credibility, a critical step toward closing the gender lending gap. Marianne Markowitz is CEO of First Women’s Bank.
Category:
E-Commerce
Elon Musk is merging his rocket maker SpaceX with his artificial intelligence startup xAI in a deal that changes what a future SpaceX IPO represents. After rumors surfaced last week, Musk confirmed the move Monday in a SpaceX blog post, calling the combined company the most ambitious, vertically integrated innovation engine on (and off) Earth, spanning AI, rockets, space-based internet, and his social media platform, X. Public records filed in Nevada and obtained by CNBC show the deal was completed February 2, with Space Exploration Technologies Corp. listed as the managing member of X.AI Holdings. Bloomberg reports that the merged company is expected to price shares in an initial public offering that could value it at $1.25 trillion. At that scale, the story is no longer just about rockets. It is about AI and Musks claim that the future of compute will not be confined to Earth. A $1.25 trillion IPO that looks very different Before the deal, a SpaceX IPO would have given investors exposure to space launch services, government contracts, Starlinks satellite internet business, and Musks long-term Mars ambitions. Now it would also include a frontier AI company and a new thesis: AI cannot scale on terrestrial infrastructure. It must scale in orbit. SpaceX was valued at about $800 billion in a secondary share sale last year. And xAI was valued at roughly $230 billion in a $20 billion funding round earlier this year. The percentage uplift is larger for SpaceX, while xAI shareholders gain stability by being folded into one of the most profitable private aerospace companies. Reuters reported last week that SpaceX generated an estimated $8 billion in profit on $15 billion to $16 billion in revenue in 2025, citing people familiar with the results. By contrast, xAI is still burning cash as it races to build infrastructure to compete with OpenAI and Google, which remain ahead in the model race. The merger ties those two trajectories together. It looks like Elon Musk has one window to do a big IPO, and he wants to make the most of that, Edward Niedermeyer, author of Ludicrous: The Unvarnished Story of Tesla Motors and an auto industry analyst, told Fast Company last week. Musks core claim: Earth cannot power the future of AI Musk argues that AIs reliance on power-hungry data centers is unsustainable, as rising demand strains both electrical grids and the environment. His solution is to move the problem off-planet. Space is called ‘space’ for a reason, he said in the blog post, arguing that there will be more room off the planet. My estimate is that within two to three years, the lowest-cost way to generate AI compute will be in space, Musk continued. This cost efficiency alone will enable innovative companies to train their AI models and process data at unprecedented speeds and scales. SpaceX has already asked the Federal Communications Commission for authorization to launch up to 1 million satellites as part of what Musk calls an orbital data center. Orbital data centers powered by the Sun The orbital data center plan would require launching 1 million tons of satellites per year. Each ton generates 100 kilowatts of compute, which equals 100 gigawatts of AI capacity added annually. Even in 2025, the most prolific year in orbital history, humanity launched only about 3,000 tons of payload into space, mostly Starlink satellites aboard Falcon rockets. The difference now is Starship. Musk envisions Starship rockets launching every hour, carrying roughly 200 tons per flight, and delivering millions of tons to orbit per year. SpaceX already operates the worlds largest satellite constellation through Starlink, with more than 9,000 satellites in orbit and roughly 9 million customers. The operational lessons from Starlink form the foundation for something much larger: satellites that function as AI data centers. A familiar Musk playbook This is not the first time Musk has merged his companies to move faster. Early last year, he merged xAI with X (formerly Twitter). Now xAI is being folded into SpaceX. Tesla, the primary source of Musks liquid wealth, said last week that it has agreed to invest about $2 billion into xAI. The merger also pulls SpaceX into xAIs regulatory scrutiny. Currently, xAI is facing probes in Europe, India, Australia, and California after its Grok AI tools allowed users to generate sexualized images of children and nonconsensual intimate images of adults from photos found online. These investigations add risk to a company that is already spending heavily to catch up in the AI arms race. Folding xAI into SpaceX gives it financial cover and operational scale, but it also ties SpaceXs future IPO to those controversies. Beyond orbit: the Moon and deep space Musks vision does not stop with satellites circling Earth. Starships ability to land heavy cargo on the moon opens the possibility of lunar manufacturing. Factories could use lunar materials to build satellites and deploy them deeper into space using electromagnetic mass drivers. Musk argues that at that scale, humanity begins to harness more of the suns energy. The business case is simpler. If space becomes the cheapest place to run AI compute, everything else follows. “The capabilities we unlock by making space-based data centers a reality will fund and enable self-growing bases on the moon, an entire civilization on Mars, and ultimately, expansion to the universe,” Musk wrote in the blog post.
Category:
E-Commerce
Oracle shares fell 2% Monday following the company’s announcement it planned to raise upwards to $50 billion in 2026. Funding rounds of that size are no longer unusual. The surge in AI investment and the growing need for cloud capacity and data centers have pushed many companies to seek massive financing. But Oracles recent run has been unusually volatile. Just a few months ago, its shares jumped 40% in a single day, briefly making CEO Larry Ellison the worlds richest person (ahead of Elon Musk). That spike came after Oracle reported a 359% increase in its remaining performance obligation (RPO, which are expected revenues based on customer commitments). That was driven by a $300 billion contract with OpenAI. Things haven’t gone so well since then, though. The stock saw a big tumble after the company reported earnings in December that fell short of analyst’s revenue expectations, the stock saw a big tumble. And Oracle shares today are well below where they stood before the spike. As of Monday, they were more than 30% lower than the mid-September level. The need to build out the infrastructure remains, though, thus the hunt for financing, which will be raised in debt and equity. Oracle, on Sunday, said it plans to use the $45 to $50 billion it hopes to raise this year to expand its cloud capacity as demand increases from customers including Nvidia, Meta, OpenAI, TikTok and xAI. While the stock was higher at times on Monday, investors began to have doubts as the day went on. In recent months, the market has become increasingly concerned about Oracle’s aggressive AI buildout plans, as well as the debt the company is taking on. That has led to the underperformance of the stock. An overreliance on OpenAI may also be a factor. While Oracle’s RPO announcement last fall gave shares a boost, a similar announcement from Microsoft last week (where RPO jumped 110% to $625 billion, with 45% of that number being a commitment from OpenAI) saw that company’s stock tumble. Like Microsoft, Oracle has significant exposure to OpenAI’s ability to delivery on its promised business. While OpenAI has been successful in its ongoing fundraising efforts, it has made $1.4 trillion in total commitments over the next eight years. That’s despite the company still not being profitable and continually hunting for additional funding (Amazon could be the next big investor, as the companies are in talks for the retailer to purchase up to a $50 billion stake. And a possible IPO looms by the end of the year.) Some analysts see Oracles financing plan as a way to reduce that dependence. By issuing equity and slightly diluting existing shareholders, Oracle can help fund its expansion without jeopardizing its investment-grade credit rating, a key factor for more conservative investors such as pension funds. “Oracle is not only saying they’re committed to investment-grade debt, but they are sending a clear message to bond investors and the rating agencies that they are,” Guggenheim analysts said in a note to investors. Oracle’s hunt for additional funding underscores just how competitive the AI field is these days. The company is racing to catch up in the cloud infrastructure field with Amazon Web Services and Microsoft. The more infrastructure-as-a-service (essentially computing power and storage it can rent out) Oracle has available, the more it can share in the cash outflow that AI companies are doling out. Whether Oracle can regain investor goodwill on an ongoing basis will likely be determined March 9, when it is next expected to report quarterly earnings. Investors will be looking for guidance about cloud capacity and AI partnerships. If revenues growth in that segment outpaces spending, Oracle could reverse the decline it has been seeing for the past several months.
Category:
E-Commerce
All news |
||||||||||||||||||
|
||||||||||||||||||