Importance Score: 45 / 100 🔵
Venture Capital and Startup Funding Weekly Briefing: This week’s startup scene demonstrated resilience, seemingly detached from broader global news cycles. While external factors create uncertainty, the flow of startup funding remained robust. New funds are emerging with a focus on long-term, impactful investments in areas like “planetary and societal health,” suggesting a continued appetite for innovative startups.
Top Startup Developments of the Week
This week’s startup news cycle encompassed a significant exit strategy, ongoing legal proceedings, an underwhelming sale, and a contentious assertion within the scientific community.
AI Sector Updates: OpenAI, Thinking Machines Lab, and Safe Superintelligence
OpenAI Executives: Mira Murati, formerly CTO of OpenAI, has onboarded accomplished advisors with OpenAI backgrounds for her new AI startup, Thinking Machines Lab. Meanwhile, Ilya Sutskever, OpenAI co-founder and ex-chief scientist, has selected Google Cloud’s TPU chips to fuel research at his fresh AI venture, Safe Superintelligence.
Industry Partnerships and Legal Disputes: OpenAI and Elon Musk
Strategic Alliances and Conflicts: Reports indicate OpenAI is exploring a potential $500 million acquisition of io Products, the AI hardware startup co-founded by Jony Ive and Sam Altman. However, a partnership remains a possible alternative. Separately, the legal confrontation between OpenAI and Elon Musk intensifies, with OpenAI filing a countersuit against its previous supporter.
Personnel Changes in HR Tech: Deel Communications Leadership
Leadership Transition at Deel: The head of communications has departed HR technology firm Deel, amidst allegations of corporate espionage involving rival startup Rippling.
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Scientific Claims and Valuation Debates: Colossal Biosciences
Colossal Biosciences Claims Challenged: Colossal Biosciences’ claim of resurrecting the dire wolf has been disputed by independent scientists. Furthermore, the company’s $10.2 billion valuation remains a subject of debate, with opinions divided on whether it is justified or inflated.
Marketplace Acquisitions and Valuation Adjustments: Lyst and Zozo
Lyst Acquired at Reduced Valuation: Lyst, the British fashion marketplace previously valued at approximately $700 million, has been acquired by Japan’s Zozo for $154 million in cash, marking a significant valuation decrease.
Financial Distress in Fintech: Solid Bankruptcy Filing
Solid Files for Bankruptcy: Banking-as-a-service startup Solid has filed for Chapter 11 bankruptcy protection, attributing the decision to “substantial and expensive litigation.” Despite raising nearly $81 million in venture funding, Solid faced a legal challenge in 2023 when Series B investor FTV Capital sued to recover its $61 million investment.
Venture Capital and Funding Highlights of the Week
The venture capital landscape this week presented a more optimistic picture compared to the volatility in the stock market, characterized by numerous significant deal closures and fund announcements.
Autonomous Vehicle Funding: Nuro Secures Series E Round
Nuro’s Funding Round and Strategy Shift: Autonomous driving startup Nuro successfully closed a $106 million Series E funding round, achieving a $6 billion valuation. This valuation is a decrease from its $8.6 billion valuation in 2021, reflecting broader market adjustments and a potential reduced capital need as Nuro shifts focus from delivery robots to technology licensing.
Energy Storage Investment: Base Power’s Series B Funding
Base Power Raises $200 Million: Base Power, a rapidly expanding home battery backup provider based in Texas, secured a $200 million Series B round led by prominent investors including Addition, Andreessen Horowitz, Lightspeed Venture Partners, and Valor Equity Partners.
Fintech Expansion: Sipay’s Series B for Emerging Markets
Sipay’s $78 Million Series B: Sipay, an Istanbul-based fintech startup positioning itself as the “Stripe for emerging markets,” raised a $78 million Series B at an $875 million valuation to facilitate expansion beyond Turkey.
Financial Wellness Funding: Rain’s Series B for Product Diversification
Rain Secures $75 Million Series B: Earned wage access startup Rain raised an all-equity $75 million Series B led by Prosus. The capital will be used to broaden its product offerings to include credit card and savings solutions.
Drone Technology Investment: Brinc Drones’ Funding Round
Brinc Drones Raises $75 Million: Brinc Drones, a Seattle-based police drone startup founded by 25-year-old Blake Resnick, secured $75 million in new funding led by Index Ventures.
Generative AI Tools Funding: Krea’s Funding Disclosure
Krea’s $83 Million Funding: Krea, a San Francisco-based startup specializing in generative AI tools for designers and visual creatives, disclosed $83 million in total funding, which includes a $47 million Series B round.
AI Sales Automation Expansion: Artisan’s Series A Funding
Artisan Raises $25 Million Series A: Artisan, an AI sales agent startup known for its provocative “Stop hiring humans” marketing, raised a $25 million Series A. The funding will support the expansion of its team by adding 22 new members to its existing team of 35.
Venture Capital Fund Closures: SignalFire and Lerer Hippeau
SignalFire’s Billion-Dollar Fund: SignalFire finalized over $1 billion in new capital commitments, increasing its total assets under management to approximately $3 billion. Similarly, Lerer Hippeau concluded its ninth fund at $200 million, an increase from its $140 million eighth fund, bringing its total assets under management to $1.4 billion.
Impact Investing: Revent and DIG Ventures’ New Funds
Revent’s $109 Million Fund II: Berlin-based venture capital firm Revent secured a $109 million Fund II to invest in startups focused on “planetary and societal health.” DIG Ventures, a family-office-turned-VC, also raised $100 million for its second fund, primarily targeting early-stage European startups in B2B SaaS, AI, and cloud infrastructure.
Final Note
San Francisco Mayor Daniel Lurie recently announced at TechCrunch’s StrictlyVC event his proactive approach to supporting the tech community. Lurie stated he is personally contacting tech CEOs to understand how the city can enhance its support, asking, “How can we keep you here? or How can we get you back?”