#280 – Amazon’s Subscribe & Switch, Affiliate Hijacking, & WordPress loses market share

Hi Shopifreaks

🎉 Before we begin, I'm excited to present a new pitch from my video series 90 Second Pitches — a channel that helps you discover innovative e-commerce technology from the most promising startups. You can subscribe to the channel on YouTube & LinkedIn.

Today's 90 Second Pitch comes from Christian Santos at Organizely, an inventory management platform that helps Shopify merchants track and manage stock, components, and purchase orders.

Christian actually built Organizely to manage his own warehouse, after discovering that existing inventory tools were both too expensive and overkill for a small merchant like himself. So he did what any engineer would do, and built his own.

What started as an internal tool has since grown into a full multi-channel inventory platform with AI forecasting, warehouse mapping, and automated purchasing, offering an entire inventory workflow in one tool at a fraction of what legacy enterprise players charge.

Some of the best e-commerce SaaS solutions I've discovered weren't built by developers looking for a problem to solve, but by merchants solving a problem they experienced first-hand within their own businesses. Organizely is a great example of that in action.

Watch Christian's 90 Second Pitch below and then let him know in the comments if you're going to add Organizely to your tech stack.

90 Second Pitch:
▶️ Watch On YouTube | ▶️ Watch On LinkedIn

Organizely:
🔗 Website | 🔗 Shopify App

Want to pitch your startup? Hit reply and show me what you're working on. I've got more great pitches coming your way soon, and I'd love to feature your e-commerce app or SaaS solution too. Hope you enjoy the new series!

And now onto your regularly scheduled programming…

In this week's edition I cover:

• Not everybody wants AI search
• Amazon is accused of “Subscribe & Switching”
• DHL eCommerce $10B deal with USPS
• Motorola phones were affiliate hijacking
• U.S. banks kept the Fed rate hikes for themselves
• Reddit's integration with Shopify is live
• Amazon licenses its AI shopping tools to third-party retailers
• OpenAI expands ChatGPT ads to local businesses
• WordPress is rapidly losing market share
• An Amazon driver stole a cat
• Tobi Lütke says one-person unicorns are “bullshit”

All this and more in this week's 280th Edition of Shopifreaks. Thanks for subscribing and sharing!

Stat of the Week

DuckDuckGo installs rose 20.8% in the seven days after Google announced its AI search overhaul. CEO Gabriel Weinberg said, “Google is force-feeding AI with no way to opt out. We want to be the place that puts users in charge and allows them to decide how much or how little AI they want.”

1. Amazon faces “Subscribe & Switch” lawsuit over alleged bait-and-hike pricing

Amazon is facing a proposed class-action lawsuit alleging its Subscribe & Save program lured customers in with discounts before raising prices, with plaintiffs calling it a “Subscribe & Switch.” How many billable hours did it take for those nerd lawyers to come up with that name?

Pennsylvania residents Aaron and Leah Herman claim they signed up for recurring coffee purchases in February 2024 expecting savings of up to 15%, but watched their payments climb from roughly $17 to nearly $29 by October, ending up higher than prices from third-party sellers on Amazon itself.

The complaint reads: 

“This is about control. By offering artificially low prices on initial purchases, Amazon induces people to part with the most important feature in a free market—choice. Then the real price of ‘Subscribe & Switch’ comes due.”

An Amazon spokesperson said subscribers get e-mails showing price changes before each order and can review, modify, skip, or cancel anytime, but the complaint argues that the notification e-mails didn't give the Hermans enough time to find better prices before the recurring payments were processed, in violation of Washington's Consumer Protection Act.

I'd also argue that customers shouldn't have to review, modify, or skip orders to consistently receive a below-retail price through “Subscribe & Save,” and that the name of the subscription alone sets the pricing expectation. 

Additionally, what kind of crappy product subscription doesn't lock in a price upon sign up? “Well, it's 15% off a price, not necessarily that price.” Can you imagine an independent retailer offering a monthly “Subscribe & Save” program on their website with variable pricing? I've literally never seen it, likely because it really is that ridiculous. It wouldn't surprise me if Amazon eventually shuts the entire subscription program down and replaces it with an Alexa-powered subscription program that monitors product pricing across its greater seller network. The existing program is obviously broken.

Whether Amazon broke any laws with its “Subscribe & Switch” program is to be determined by the courts. However, we don't need a judge or jury to conclude that Amazon broke customer trust through the practice, which completely goes against the company's own “Customer Obsession” policy.

2. DHL eCommerce signs $10B deal with USPS to handle its last-mile delivery

DHL eCommerce signed a $10B exclusive multi-year contract with the U.S. Postal Service to handle its last-mile parcel delivery in the U.S., marking the first time that the two organizations have entered into a multi-year agreement in their 25-year history of working together.

Through the arrangement, DHL eCommerce will handle nationwide pickup and sortation across its 19 automated hubs, transport packages between facilities on its air and ground network, and then hand off to USPS for final-mile delivery to more than 41,550 ZIP Codes and 170 million delivery points six days a week.

Scott Ashbaugh, CEO of DHL eCommerce Americas, said the deal creates a “dependable, long-term platform” for customers and supports the company's emissions reduction goals by minimizing additional vehicles on the road. Postmaster General David Steiner said the extended agreement aligns DHL eCommerce more closely with USPS's transformed network to create a “stronger, more efficient last-mile solution.”

Last year, USPS developed a new auction system to determine market rate for its services and make Amazon and other business customers compete for postal capacity. Does this mean that DHL placed a $10B bid and won the auction?

Not exactly. Steiner says that DHL did not directly place a bid, but that the auction process helped inform how the arrangement was structured. He told FreightWaves:

“Through the Last Mile solicitation process, we gained significant insight into market demand and customer needs. That initiative helped validate the value of our network and highlighted opportunities to create more flexible pricing and operational models tied to our evolving last-mile infrastructure. The DHL agreement reflects many of those learnings.”

It's been highly reported that USPS posted a $9B annual loss in 2025 and is facing a serious cash crunch by 2027, which is part of the reason the agency renegotiated its deal with Amazon earlier this year. While this new $10B deal spread over an undisclosed multi-year term won't close the $9B annual gap on its own, it will provide USPS with dependable, recurring revenue to steady the ship while it lobbies Congress to lift its borrowing cap. 

3. Motorola phones were caught hijacking Amazon app traffic to insert affiliate codes

Motorola recently got caught routing users on some of its phones through an affiliate tracking link before opening the Amazon Shopping app, allowing the connected affiliate to collect a cut of any purchase made during the session. Motorola says the behavior was “unintended” and has been “promptly corrected,” though it didn't explain how it started happening in the first place. 

On affected devices, opening the Amazon app would briefly launch the browser, route the user through a couple of third-party domains, including one linked to fashion influencer Kira Abboud, and attach an affiliate code to the shopping session before landing them in Amazon. The behavior was first spotted by a Reddit user and reported by 9to5Google.

Motorola blamed the redirect on an app search feature co-developed with a partner called Device Native, whose site was queried in the background before the redirect, but neither company explained how the issue was introduced.

Various tech publications have traced the full redirect chain:

• Tapping the Amazon icon fired a request to devicenative.com.
• That bounced the traffic through kira-abboud.com (which is not the influencer's primary website).
• Then handed the user to Amazon with the affiliate tag “sramz-kff-008-20” attached. 

Notably, that tag doesn't match any of the affiliate codes Kira Abboud uses in her own public links, which suggests that the code wasn't coming from a straightforward influencer deal but from somewhere in the middle of the chain.

There are companies out there that help influencers amplify the reach of their campaigns and earn more commissions, of which they keep a slice. It's not hard to imagine a bad actor somewhere in that ecosystem working with someone on the inside at an app-search partner like Device Native to inject creator codes at the OS level, inflating campaign numbers while the influencers themselves stay none the wiser, simply thinking their relationship with said amplification partner is proving to be fruitful. I'd also guess that Kira was one of many influencers to have their code injected into Motorola phones in this manner, and simply happened to be the related affiliate when this whole controversy was exposed.

To be clear, this is pure speculation. I have no evidence that Kira, Device Native, or any amplification company did anything wrong, and Motorola maintains the whole thing was an unintended misfire it has since corrected. I'm simply describing the incentive landscape that makes this kind of abuse attractive, not accusing anyone of it.

The Verge notes that the affiliate code “wouldn't make any direct difference to the end user, but could theoretically allow whoever installed it to receive a small percentage of any purchase that was made.” However, it most definitely impacted other Amazon Associates, particularly the ones that may have actually been responsible for the sale itself.

For example, if a user was reading a blog or social media post that included an Amazon affiliate link from the creator who made the post, their commission would have been hijacked by Motorola's redirect, which installed a different affiliate's code, as Amazon uses last-click attribution.

The investigation by Motorola should go further than “oops, we fixed it,” and may warrant involvement from government agencies, given the potential for fraud.

What are your thoughts on this odd controversy? Hit reply and let me know.

4. U.S. banks pocketed $485B of the Fed's rate hikes instead of paying savers

U.S. banks captured roughly $485B a year by paying customers with savings accounts far less than the Federal Reserve paid them, according to a 17-year analysis of Federal Reserve and FDIC data by Alan Percal of Compare Personal Finance.

At the August 2023 peak, the Fed Funds rate stood at 5.33% while the FDIC's average savings rate was just 0.43%, a 4.90 percentage point gap that was the widest on record and more than double the prior modern high. Across four complete rate cycles, the study found banks passed through no more than 7% of any Fed hike to savings accounts, and consistently kept at least 93% of every move.

Quick History: When the Federal Reserve raises rates, banks earn more interest on the money they park at the Fed. In theory, banks then compete for customer deposits by raising the interest they pay on savings accounts, passing some of the windfall along to account holders. The share that actually reaches savers is called “deposit beta.” Economists have long assumed banks pass through about half of any Fed rate change to depositors over time. However, the report found that the real number is nowhere close for regular savings accounts.

During the 2022-23 cycle, which was the most aggressive Fed tightening in 40 years, the Fed raised rates by 525 basis points (5.25 percentage points), while the average FDIC savings rate crept from 0.06% to just 0.43%. Banks captured 93% of the move. In the prior 2015-19 cycle, it was even worse, with banks keeping 98% of the hike, and the average savings rate moving a grand total of four basis points (0.04%) over several years.

The report also found that the lag between adjusting rates has been extremely one-sided.

After the Fed's December 2015 hike, the average savings rate did not budge for 26 months, while rate cuts reached customers within weeks. The analysis estimates the average American household left about $3,300 in interest on the table during the most recent cycle by holding cash in standard accounts rather than high-yield ones.

Robinhood was particularly awful about bringing rate drops to customers, oftentimes doing so in what felt like hours. After rates dropped, I remember getting marketing e-mails from them promoting how “Robinhood is making it cheaper to trade on margin,” and like clockwork, I'd get an e-mail the next day about how my high-yield savings account rate was dropping, and this was blamed on the Fed rate drop. Basically they took credit for it becoming cheaper to borrow money, and blamed the Fed for paying out less to savings accounts. The marketing spin pissed me off every time.

To be fair, banks are under no obligation to pass ANY Fed rate hikes to their customers, so it's not that they did anything illegal — just greedy and unethical — and I felt it was important for my readers to know. I've long argued that the U.S. needs more competition in the banking sector and advocated for issuing additional bank charters, and studies like this exemplify why.

5. Reddit's integration with Shopify is now available to all merchants

Reddit made its native Shopify integration widely available to advertisers worldwide, moving the tool out of the alpha testing phase it launched in March. The integration lets Shopify merchants connect their storefronts directly to Reddit's ad platform and run Dynamic Product Ads.

Here's how it works: 

1. Merchants install the Reddit Ads app (which currently has no reviews) and give permission to link their two accounts together.
2. Reddit installs a pixel on the store that tracks conversions, without altering theme code.
3. The merchant live-syncs their product catalog between the two platforms, allowing it to update images, pricing, descriptions, and inventory levels in real time.
4. The merchant can now run shoppable ads that appear in users' feeds and inside conversation threads.

Reddit claims that its ads platform delivers more than 2x the incremental ROAS of the average media plan in North America, returning $12.52 for every dollar spent, and a 7x average ROAS for retail advertisers in EMEA. Early testers like apparel brands Ethnotek and Under 5'10 reported 4x and 7.7x ROAS respectively versus standard conversion campaigns, according to a TransUnion study commissioned by Reddit.

The Shopify integration is the latest move in Reddit's ongoing goal of becoming a shopping destination, like nearly every other major platform. In recent months, I reported that Reddit: 

• Expanded its Dynamic Product Ads with new features like collection ads and deal overlays.
• Launched a WooCommerce integration, similar to the Shopify integration.
• Added its advertising inventory to Pacvue's retail media platform alongside Amazon, Walmart, and Target.
• Began testing AI shopping carousels that pull from DPA partner catalogs directly inside its search results.

Reddit's ad revenue hit $625M in Q1 2026, up 74% year over year, with performance-oriented ads now making up more than 60% of total ad revenue.

6. Amazon to license its AI shopping tools to third-party retailers

Amazon Web Services launched Agentic Shopping Assistant, a new offering that helps third-party retailers build AI shopping features like search, product comparison, and customer support into their online stores, while keeping control of their own data.

The company wrote in its announcement: 

“The solution provides a technical foundation with architecture guidance, starter code, and support from AWS experts and system integrator partners, allowing them to launch their own conversational shopping experiences in weeks—rather than the years it would take starting from scratch. It is tailored to each retailer's specific catalog, customer base, and shopping environment. Each deployment is customized to match the retailer's brand voice and domain expertise.”

The Agentic Shopping Assistant is built on AWS services such as Bedrock, AgentCore, and OpenSearch, and validated through real shopping interactions on Amazon.com, which the company says is “Customer Zero” for the product. The service is effectively the equivalent of Alexa for Shopping, which Amazon added to its own marketplace in May, replacing a disparate set of AI features that Amazon said drove nearly $12B in incremental sales last year.

Kate Spade is the first retailer to deploy the tool in production with its launch of the Kate Spade AI Gift Concierge, built on Anthropic's Claude Haiku 4.5 model using Amazon Bedrock.

Is it just me? Or are AI tool announcements starting to feel like the opening production logos to movies?

“Kate Spade AI Gift Concierge, brought to you by Amazon Agentic Shopping Assistant, built on Anthropic Claude Haiku 4.5, via Amazon Bedrock, in partnership with AgentCore and OpenSearch, presented by AWS, in cooperation with Tapestry.” And then there's a roaring lion surrounded by a golden AI chat widget.

Anyway… I'm impressed with the product and would love to have Alexa for Shopping running on my own retail websites. Though it makes me question whether we're moving toward an online retail environment where independent D2C websites are either going to be powered by Amazon, Google, or Walmart AI products. Yes, there are hundreds (maybe thousands) of other AI search and chatbot solutions currently on the market for independent retailers, but most of them are just LLM wrappers, and none of them get you as close to Amazon's retail expertise or have been battle tested on Amazon.com.

What are your thoughts about the future of AI shopping on independent sites? Hit reply and let me know.

7. OpenAI expands ChatGPT advertising to small and local businesses

OpenAI is expanding its ChatGPT advertising platform to small businesses like car washes and dry cleaners, putting it in direct competition with Google and Meta in local markets, according to The Information.

OpenAI displays ads in clearly labeled tinted boxes that appear below or alongside the chatbot's organic answer, never woven into the response itself. So if a user asks ChatGPT to recommend an emergency AC repair company, the chatbot gives its organic answer in the main chat feed, while a sponsored listing from a local HVAC business appears adjacent to it. OpenAI says ads run on separate systems from the chat model and can't influence, rank, or alter ChatGPT's actual responses, a principle it calls “answer independence,” nor do ads appear near sensitive topics like health and politics. Though I imagine the “health” stance will change in the future, as that's a valuable advertising sector.

Since launching ChatGPT ads in February with big brands and a $200,000 minimum commitment, OpenAI has dropped its upfront spending requirements and rolled out a self-service ad-buying portal in the U.S. for businesses of any size. It is also introducing conversion-oriented ads, which advertisers pay for only when they get results, as well as an ad pixel and API so advertisers can track what users do after clicking, which hasn't been possible in early ChatGPT ad offerings. Advertisers who configure either the OpenAI Pixel or Conversions API by June 1 will get early access starting June 5, and conversion tracking is already live inside Ads Manager.

OpenAI has previously told investors that it expects around $2.4B in ad revenue this year, with plans to hit $102B, more than 35% of its overall projected revenue, by 2030. Of course, all that depends on whether 900M people continue to use the chatbot by then. (OpenAI projects 2.75B users by 2030, which makes their projections even more far-fetched.)

ChatGPT still leads the AI chatbot pack at 56.72% market share, but that's down from 77.43% a year ago, according to The Decoder, while Google, on the other hand, jumped from 6% to 25.46% and Claude grew to 6.02% traffic share during the same period.

8. WordPress loses market share for six consecutive months at an accelerated pace

WordPress has lost market share for six consecutive months, falling from 43.20% in December 2025 to 41.90% as of May 2026, according to W3Techs data. The 1.3 point drop over six months is more than double the 0.60 point YoY decline from January 2025 to January 2026, suggesting the pace is accelerating as competitors gain ground.

In comparison against competitors:

• Shopify rose 0.20 points to 5.20%
• Wix climbed 0.10 to 4.30%
• Squarespace gained 0.10 to 2.50%
• Webflow and Duda held steady

Meanwhile, the developer framework Astro, which isn't tracked in W3Techs' CMS share, more than doubled its downloads over the same period, from 4.59M in January to 9.24M in April, a sign that some developers are leaving WordPress in search of newer, more developer-focused tools rather than other website builders.

Search Engine Journal notes that the rapid decline kicked off in the quarter after Automattic CEO Matt Mullenweg's public attacks on WP Engine, which included blocking WPE users from updates, cloning WPE plugins, and requiring contributors to disavow ties to the company.

Anecdotally, I can also testify that Mullenweg's actions have caused me to lose some confidence in the WordPress ecosystem, making me less likely to start a brand new project on WordPress over Shopify or alternatives. To be fair, there are technical reasons why I've leaned toward platforms other than WordPress, such as Shopify's API now enabling features that I previously had to rely on editing a WordPress database to accomplish, as well as my preference toward not having to deal with hosting or server admin. However, the shaky ground at Automattic this past year certainly hasn't helped nudge me toward WordPress either.

Honestly, it sounds like it's time for a new CEO at Automattic! And I'm not being opinionated or snarky. That's just the numbers speaking.

9. Other e-commerce news of interest

Intuit Mailchimp launched Analytics AI, a conversational analytics agent that lets marketers ask questions about campaign performance, audience behavior, and revenue, without having to export data or build custom reports. The agent can analyze a merchant's connected e-commerce data from Shopify, WooCommerce, and Wix alongside its Mailchimp campaign history, tell the business what changed, and make recommendations on how to improve future campaigns. The company also introduced an AI Segment Builder in beta that creates audiences from natural-language descriptions, as well as a Mailchimp app inside Claude and ChatGPT that lets users draft and launch campaigns from either platform's chat interface.

Google is merging Display Network ad management into Demand Gen campaigns, letting advertisers run both through a single unified setup. Display Network ads reach over 90% of global internet users across partner websites, while Demand Gen covers YouTube, YouTube Shorts, Discover, and Gmail. Advertisers can still choose to serve ads exclusively on the Display Network if they prefer, but the new structure makes it easier to expand into Demand Gen placements from the same campaign. Google claims that advertisers who add Display Network inventory to Demand Gen campaigns see a 9.5% lift in ROI on average.

Amazon shut down an employee-created internal leaderboard called KiroRank that tracked AI token usage, after staff used it to perform superfluous tasks just to climb the ranks. Amazon SVP Dave Treadwell told staff earlier this week, “Please don't use AI just for the sake of using AI. Use AI to help you solve customer problems, to help you solve business problems, to innovate.” An Amazon spokesperson told Business Insider that the dashboard was an informal tracker created by a group of employees and “was never intended to promote the use of AI for usage's sake.”

Walmart could be eligible for tariff refunds worth roughly $2.4B, or less than half of 1% of its U.S. annual sales, which the company would use to lower prices for shoppers, according to CFO John David Rainey. He said, “We think the single best return that we can have on a dollar capital right now is to invest in the customer and invest in price,” though Walmart excluded any expected recoveries from its outlook. U.S. Customs and Border Protection began accepting refund claims last month tied to tariffs the Supreme Court struck down in February, and has so far processed over $35B in refunds, including interest, as of May 11.

Shopify CEO Tobi Lütke called the one-person billion-dollar company “bullshit” during a fireside chat at Toronto Tech Week's Homecoming event, saying that while AI makes it technically possible for a solo founder to build that kind of business, he doesn't see the point. “Why the fuck would you not spend some of that money to have someone else around?” he asked. Lütke agreed startups with a handful of people can now scale into billion-dollar businesses, giving the example of AI voice dictation company Wispr, which went from seven employees a year ago to roughly 60 and is reportedly closing a round at a $2B valuation. He added, “The shape of companies is going to change. Companies will be smaller, but there will be vastly more of them.”

Meta began the global rollout of “Plus” subscription plans for Instagram, Facebook, and WhatsApp, and is starting to test additional AI-focused subscriptions under a new umbrella brand called Meta One. The Plus plans add features like profile customization, story insights, super reactions, custom app icons, and the ability to spotlight, extend, or preview a story without showing up as a viewer (creepy), and sit alongside the existing Meta Verified product. Meta One subscriptions offer that and more, including unlocking deeper reasoning and more image and video generation through Meta AI. Plus plans start at $2.99/month (WhatsApp) and $3.99/month (Facebook & Instagram), while One plans begin at $7.99/month and go as high as $49.99/month. Honestly, terrible rollout of premium plans with way too many tier options, but the company did note that it's still experimenting and hopes to one day bring them all together under Meta One.

Amazon and BuzzFeed are moving forward with Cupcake & Friends, an AI-animated Prime Video series based on the Good Advice Cupcake character, despite public protest from creator Loryn Brantz, who created the character Cuppy while working at BuzzFeed in 2017, but later left to work for Ms. Rachel in 2023. Brantz, who was previously assured by BuzzFeed that it would not continue the IP without her involvement, called the new series “an assault on artists everywhere” and is urging a boycott of BuzzFeed and AI-produced animation. A BuzzFeed spokesperson said the company owns the Cuppy IP and “is excited to use new technology to bring a dormant library series off the shelf and to give it new life.” 

Senator Ed Markey sent letters to TikTok U.S. and Oracle demanding contracts and details about whether the joint venture keeping TikTok operating in the U.S. adequately addresses national security concerns over the app's Chinese ties. Markey alleged the spin-off arrangement falls short of the spirit of the 2024 divest-or-ban law and wants the full contracts between Oracle, TikTok U.S., and ByteDance covering the algorithm license, plus an explanation of how the joint venture audits ByteDance code and adapts the algorithm for U.S. audiences. How in the hell has none of this been made public yet? Or at minimum, made available to Congress for review prior to being approved? Hey Oracle, Silver Lake, and MGX — we want answers!

An Amazon delivery driver was caught on camera taking a California family's pet cat from outside their home. The irony of the situation is that he was caught on a Ring camera! An Amazon spokesperson said, “The driver works for a Delivery Service Partner, which are small businesses that deliver packages to customers. We're looking into it and working with law enforcement as they investigate.” LOL, did he drive an Amazon-branded truck and wear an Amazon uniform? STFU Amazon with your “not directly employed by Amazon” nonsense and get this family their cat back!

In lawsuits this week (which are predominantly Meta related)…

• The FTC is asking the D.C. Circuit appeals court to revive its antitrust case against Meta, dismissed last year when Judge James Boasberg ruled that competition from TikTok and YouTube meant Meta no longer holds a social networking monopoly, with the agency now arguing it only had to prove monopoly power when the case was filed in 2020, not based on today's market.
• Meta is asking the 9th Circuit to throw out a class-action suit from consumers who lost money to fake Facebook ads, including an Oregon man scammed out of $49 on a phony car-engine kit, arguing its terms of service clearly disclaim responsibility for third-party content. Last year, a district judge ruled that Meta's liability disclaimer was “unconscionable” and that its failure to honor its own terms of service, which promise to act against fraudulent content, could support breach-of-contract claims.
• Meta lost its bid to dismiss a class-action suit alleging Facebook overcharged advertisers a collective $4B between 2013 and 2017 by running a “blended price” auction (where winners pay between their own bid and the runner-up's) while claiming to run a “second price” auction (where winners pay no more than the second-highest bid). Judge Charles Breyer ruled that Facebook's statements promising advertisers they'd pay only the “minimum amount” were ambiguous enough to require more evidence.
• Meta lost its bid to block Vermont's lawsuit alleging Instagram and Facebook harmed young users after the U.S. Supreme Court declined to hear its appeal. The decision opens the door to similar state suits and follows recent court losses for Meta and YouTube in social media addiction cases in California and New Mexico.
• Texas Attorney General Ken Paxton is suing WhatsApp and Meta under the state's Deceptive Trade Practices Act, alleging the app misleads users by marketing “end-to-end encryption” while still being able to read private messages. The case cites whistleblowers and a closed federal Commerce Department investigation in which an agency investigator wrote there was “no limit” to the WhatsApp messages Meta could view.
• CNN is suing Perplexity in New York federal court, alleging the AI search engine copied thousands of its stories, videos, and images to power its products and distribute “identical or substantially similar” competing content. The company is seeking unspecified damages and an injunction in a suit that adds to the legal challenges Perplexity already faces from The New York Times, Reddit, and Dow Jones over similar allegations.
• Australia's Competition and Consumer Commission is suing Amazon, alleging it supplied children's “Unicorn Toddler Backpacks,” which included a detachable light-up unicorn toy containing button batteries, without the warning labels required under mandatory safety standards, in what is the ACCC's first Federal Court case against an online marketplace over product safety laws.
• Redfin is facing a proposed class-action lawsuit from plaintiff Biljana Gallardo in California federal court, alleging it secretly shared users' video-viewing activity and sensitive financial data, including credit score ranges and home purchase timelines from its mortgage pre-qualification survey, with Meta and TikTok through embedded tracking pixels.

• Crumbl reached an agreement with Warner Music Group to settle a lawsuit that accused the cookie company of using at least 159 songs, including works by Dua Lipa, Taylor Swift, and Beyoncé, in its TikTok and Instagram promo videos, and continuing to do so after receiving a cease-and-desist letter. Financial terms were not disclosed, and may or may not include free cookies for life.

In layoffs this week…

• Wix laid off 1,000 employees, or 20% of its workforce, with CEO Avishai Abrahami citing the exchange rate between the Israeli shekel and U.S. dollar as creating “structural pressure” on the company's ability to operate at its current scale and “the fast evolution of AI capabilities” as reasons for the downsizing. 
• Groupon, which still exists, is cutting up to 400 positions, or nearly a fourth of its workforce, as it plans to rebuild as an AI-native company, citing projected annualized savings of about $25M.

In corporate shakeups this week…

• OpenAI hired ServiceNow CMO Colin Fleming as CMO of its business unit, reporting to chief revenue officer Denise Dresser and succeeding Kate Rouch, as the company deepens its enterprise marketing around products like Codex ahead of a potential IPO.
• Kroger SVP of retail divisions Valerie Jabbar retired this month after 38 years, making her the third senior executive to exit since Greg Foran became CEO in February.
• Rokt named Sam Dozor, who spent 13+ years building customer data platform mParticle before Rokt acquired it in 2025, as its new CTO, tasking him with leading engineering across platform infrastructure, developer experience, and security.
• Authentic Brands Group founder Jamie Salter moved from CEO to executive chairman to focus on M&A and international expansion, with president Matt Maddox, a 20-year Wynn Resorts veteran who joined in January 2025, taking over as CEO as the company targets a public listing within 12 months.
• Syndigo named Sona Chawla, a Kohl's, Walgreens, Dell, and CDW veteran who sits on CarMax's board, and Brian Tilzer, formerly of Best Buy, CVS Health, and Staples, and an independent director at Signet Jewelers, to its board of directors as it scales its product experience management platform for brands and retailers.
• Spellbook hired Jean-Michel Lemieux, a former Shopify and Atlassian CTO, into a newly created “Executive Individual Contributor” role spanning product, engineering, go-to-market, and internal systems, to help scale its AI contract software.

OpenAI CEO Sam Altman said the rapid rise of AI is unlikely to trigger a global “jobs apocalypse” and that the technology has not eliminated as many white-collar jobs as he once expected, though he has been known to be a complete fucking liar. While speaking virtually at a Commonwealth Bank of Australia conference in Sydney, Altman said OpenAI had been “roughly right” on its technology predictions since launching ChatGPT in 2022 but “pretty wrong” on the social and economic effects, calling himself “delighted to be wrong” about entry-level white-collar job losses. He said he now believes a “human part” of many jobs cannot be replaced by AI, pointing to his own experience of unsuccessfully attempting to let ChatGPT answer his Slack and e-mail messages. Altman cited no jobs figures to defend his newfound point of view, and the comments come as the OpenAI Foundation commits $250M to grants, partnerships, and direct work focused on how AI is reshaping the economy and how to support workers through the transition, which feels a bit contradictory to Altman's statements.

Condé Nast CEO Roger Lynch told his teams to plan for a “Google Zero” future in which the search engine sends them essentially no traffic, as Google reshapes Search into an AI assistant that answers questions directly rather than linking out to the sources. Last week, I reported that Google's AI Overviews now result in a 58% lower average click-through rate for top-ranking pages, Nicholas Bouliane, who runs the immigrant-focused site All About Berlin, said his visits are down 70%, while People Inc. CEO Neil Vogel said Google Search has fallen from about 65% of the company's traffic three years ago to the high 20% range. Remember when digital media killed print media? One day people will be asking, “Remember when Google killed digital media?”

The European Commission fined Temu €200M for failing to prevent the sale of illegal products on its platform such as baby toys and small electronics in violation of the Digital Services Act. Temu disagreed with the decision, called the fine “disproportionate,” and said it doesn't reflect the current state of its systems. However, that number might be a drop in the bucket compared to what the Commission is planning to fine Google as part of an antitrust investigation that alleges the company favors its own services in search results. The fine is projected to be in the high triple-digit millions and would be the largest penalty the EU has issued under its Digital Markets Act. The decision is nearing completion and is expected to be announced before ​the summer break, according to Reuters.

The UK's Financial Conduct Authority is planning to tighten standards across consumer finance and payments like installment payments, loyalty-linked credit, insurance products, digital wallets, and embedded finance tools. The agency plans to more strictly enforce its Consumer Duty rules, which require firms to demonstrate fair pricing, proper affordability checks, and support for vulnerable customers rather than just meeting minimum compliance, and to expand its use of AI to monitor firms and detect risks faster. It also intends to push harder on fraud detection, anti-money laundering controls, and payment security, and to bring BNPL under formal regulation in July, introducing new affordability requirements across the sector. Meanwhile, the U.S. is moving in the opposite direction in regard to consumer finance regulation, which is probably a smart move, given that the government might need to lean on installment payments in the future to pay off its $39 trillion debt.

Hundreds of Meta contractors employed by Covalen, a Dublin-based outsourcing firm that provides content moderation and data annotation services to Meta, marched in front of Meta's European headquarters on Friday to protest planned layoffs affecting 700 workers, the second cut since November. A large share of affected workers won't receive any severance because they've been employed for less than two years, while the rest are being offered the local legal minimum of two weeks' pay per year of service. The Communications Workers' Union is asking Covalen to double the severance, pay those under the two-year threshold, and waive the six-month cooldown clause blocking laid-off workers from joining other Meta contractors. Can you imagine getting laid off and then being told you can't look for another job in the same field for six months due to a “cooldown” clause? They can cool down these nuts.

Amazon Japan has started using the country's bullet trains, which can reach speeds of up to 200mph, to move packages between facilities across different regions as part of its efforts to cut delivery times and carbon dioxide emissions. “Excuse me, is anyone sitting there?” the old woman says to 900 Amazon boxes. LOL. Joking, of course, as the packages ride in non-passenger space on three routes connecting Greater Tokyo with central and northern Japan. The initiative is part of Amazon's commitment to reach net-zero carbon across its global operations by 2040 — promises that have recently been undermined by its AI data center buildouts, which caused Amazon's overall carbon emissions to grow last year for the first time since 2022. 

🏆 This week's most ridiculous story… A Google software engineer named Michele Spagnuolo has been charged with fraud and money laundering for allegedly (but definitely) earning $1.2M by trading on Polymarket using nonpublic Google search data. Prosecutors say Spagnuolo wagered $2.7M across 25 bets tied to Google's Year in Search results from October to December 2025, including a bet that Kendrick Lamar and d4vd would finish in the top five of the most-searched people in 2025, at a time when public odds on d4vd were barely above 0%. He also correctly bet $100k on the release date of Google’s Gemini 3 AI model. Google said Spagnuolo accessed marketing material available to all employees but called the bets “a serious breach of our policies.” Did he at least lose a few bets to throw off the scent? Or did this schlemiel go 25 for 25 with longshot bets specifically about Google and think no one would notice?

10. Seed rounds, IPOs, & acquisitions

Stord, an e-commerce supply chain and logistics company that operates a network of warehousing, fulfillment, and transportation services, raised nearly $250M in a Series F round led by Strike Capital and other existing investors at a $3B valuation, double from last year. Alongside the raise, the company launched Stord Labs, a research environment at its Atlanta headquarters for developing agentic AI, robotics, and automation that it tests against real orders on the platform's live operating system for faster rollout. Stord says its revenue has grown more than 10x over the past four years, and it now powers over $15B in GMV annually across more than 1,000 brands.

Anthropic raised $65B in a new funding round led by Greenoaks Capital, Sequoia Capital, Altimeter Capital, and Dragoneer Investment Group at a $965B valuation, 2.5x its $380B valuation from three months ago. The round helped Anthropic officially surpass OpenAI as the world's most valuable AI startup, while more than doubling the net worth of the company's seven cofounders. Alongside the funding round, Anthropic unveiled Claude Opus 4.8, a new flagship model it claims is significantly better at coding and scored 10% higher on Vals AI's vibecoding benchmark. CFO Krishna Rao said the company's revenue run rate crossed $47B this month.

OpenAI has held discussions with Citigroup and JPMorgan about joining Goldman Sachs and Morgan Stanley on its upcoming IPO, according to Bloomberg sources, though the conversations may not ultimately result in either bank joining the lineup. The company is expected to confidentially file for an IPO within weeks, with the listing potentially coming later this year. The deal would follow Elon Musk's SpaceX, whose IPO is expected to be the largest of all time at $75B, and would put OpenAI ahead of Anthropic, which is expected to launch its own jumbo-sized offering later this year or early next.

Fairdeal.Market, an Indian B2B quick-commerce platform that restocks neighborhood kirana stores, raised $15M in a Series A round led by Bertelsmann India Investments, bringing its total amount raised to $18M. The startup delivers more than 1,000 SKUs to retailers within 60 minutes of placing their order, positioning fast replenishment as its edge over wholesale players like Udaan and Jumbotail. The funding will go toward scaling dark-store operations, strengthening its technology infrastructure, and expanding last-mile delivery into new cities.

Global-e, an Israel-based cross-border e-commerce platform that helps merchants sell internationally, acquired Passport, a U.S.-based cross-border e-commerce logistics platform that handles international shipping and customs, for $350M upfront plus up to $75M in contingent payments tied to Passport's 2026 financial results. The deal deepens Global-e's logistics capabilities and adds support for direct injection, consolidated returns, and customs brokerage. Passport founder and CEO Alex Yancher will join Global-e's executive team to lead the integrated Passport business, with the deal expected to close in early July.

JD.com is considering a £2B bid for The Very Group, a British online shopping platform that offers its own in-house BNPL payment option, according to Sky News sources. The Very Group is currently owned by private equity firm Carlyle, which took control of the retailer last year, ending the Barclay family's long-time involvement in the business. The bid would mark JD.com's third attempt at acquiring a UK retailer, after having abandoned a bid for Currys in 2024 and walking away from talks to buy Argos from Sainsbury's last year. In recent months, JD.com has expanded its European presence with its platform Joybuy and its own delivery service JoyExpress.

Baseten, an AI inference provider that rents Nvidia servers to developers and helps them train, customize, and run mostly open-source AI models, is in talks with investors to raise $1B at an $11B valuation, more than double the $5B valuation from its round just three months ago. The company's annualized revenue rose to $600M in its most recent quarter, up 20x from a year ago. Baseten, which was founded in 2019 and competes with Modal, Together AI, Replicate, and Databricks, has previously raised $585M from investors including Nvidia, CapitalG, IVP, and Spark Capital.

Capchase, a New York-based fintech that provides B2B buy now pay later financing embedded into the sales workflows of software and hardware vendors, raised $26M in equity and a $174M credit facility in a round led by 01 Advisors. The company launched in 2020 to provide revenue-based financing for SaaS companies, but pivoted in 2022 to vendor financing, offering flexible terms such as $15k/month for five years instead of $1M upfront, while paying the vendor the full amount immediately, minus a fee. The company says it has seen a 400% growth rate over the past 12 months and forecasts another 200% growth in the coming year.

Sprinklr, an enterprise-level customer experience management platform, acquired the assets of ViralMoment, an AI social video intelligence and analytics company, for an undisclosed amount. The deal adds video, image, and audio analysis to Sprinklr's Unified Customer Experience Management platform, including the ability to analyze short-form videos frame by frame on TikTok, Meta Reels, and YouTube Shorts. The combined platform aims to capture sentiment and product feedback expressed visually, helping brands spot cultural trends earlier and understand why content performs and resonates with viewers.

OuterSignal, a customer intelligence platform that uses AI to analyze publicly available data and help brands personalize outreach to customers, acquired Monocle, an AI lifecycle marketing platform that replaces rules-based flows with autonomous customer journeys across e-mail, SMS, and web, for an undisclosed amount. The combined platform will tell brands who their customers are, and then take action on that intelligence, letting marketers scale one-on-one experiences agentically. Existing Monocle customers will keep using the product without disruption, with OuterSignal taking over account management and support and deeper platform integration planned over time.

Carbonfact, a carbon management software provider that helps fashion brands measure, report, and reduce emissions, acquired Vaayu, a product impact platform that tracks emissions across products, packaging, logistics, and supply chains, for an undisclosed amount. The combined platform will include over 150,000 fashion-specific emission factors, primary data from over 7,000 textile factories, and more than 300 brand customers. The deal comes as fashion brands face new rules including the EU's Digital Product Passport, the French Eco-Score, and California's SB253, with regulators pushing toward product-level data reporting.

Canals, an AI workflow software for distributors that automates manual processes across sales, customer service, accounting, purchasing, and receiving, raised $35M in a Series A round led by Base10 Partners. The company positions its software as an “Operating AI” for the industrial supply chain, with tools for order entry, inquiry handling, accounts payable, statement reconciliation, PO tracking, and receipt tracking. Its platform is used by more than 100 distributors and has processed over 8M sales orders and $5B in payables.

OpenRouter, an AI gateway that gives developers access to over 400 AI models through a single interface, letting them route tasks to different models to control costs or improve performance, raised $113M in a Series B round led by CapitalG, the growth venture fund of Alphabet, at a $1.3B valuation. The new round more than doubles its valuation of $547M from a year ago when it raised $40M in a Series A round led by Andreessen Horowitz and Menlo Ventures. The platform has over 8M global users and processes 100 trillion tokens per month, a 5x increase from six months ago.

Matternet, the only FAA Type-Certified drone delivery platform in the U.S., raised approximately $33M in an oversubscribed private placement alongside a go-public reverse merger with Los Altos Ventures Corp, which has been renamed Matternet, Inc. Proceeds will go toward launching the company's next-generation drone delivery platform and expanding commercial operations across food, retail, and healthcare. The company, which has partnerships with UPS and SoftBank Robotics America, has logged over 60,000 commercial flights since 2014.

Return Helper, a Taipei-based cross-border e-commerce returns and recommerce platform, raised $4M in a Series A round led by Cathay Venture. The startup, which operates more than 20 overseas warehouses, partners with more than 30 carriers, and integrates across Shopify, Amazon, TikTok, and eBay, reported 60% YoY revenue growth in 2025 and hit profitability in the second half. It will use the funds to expand in Japan with Mitsubishi Logistics, build AI agents for automated cross-border returns decisions, and scale its recommerce business.

TrueLayer, a European open banking payments company, acquired in3, a Dutch fintech specializing in consumer credit via bank payments, for an undisclosed amount. The deal makes TrueLayer the only Pay by Bank network in Europe to offer both debit and credit at checkout, allowing customers to either pay immediately or over time through the same payments experience. Pay by Bank now accounts for up to 17% of European e-commerce transaction value, with recent adoption from Amazon and eBay.

Yoco, a South African fintech that provides card-payment machines, online payment tools, and business software to SMBs, acquired Dyner.ai, an AI operating system that helps restaurants manage inventory, suppliers, margins, reporting, and daily operations, for an undisclosed amount. The deal is part of Yoco's planned evolution from a payments company into a broader commerce and operations platform for independent businesses. Yoco serves more than 200,000 merchants across South Africa, many of them shared with Dyner, which will continue operating independently.

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Paul E. Drecksler
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PS: What is Forrest Gump's favorite LLM? GenAI