Ex-Twitter Chairman Sues Elon Musk’s X for $20 Million in Shares & Cisco Fires Thousands of Employees

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☕Hey there, Welcome to today's quick rundown in the Venture Daily Digest Newsletter. We've got the scoop on startup fundraising, VC funds, and some cool tech – all in just 5 minutes!

Top News

Omid Kordestani, a former Twitter board member, has sued Elon Musk's X (formerly Twitter) for $20 million. The lawsuit claims Musk refused to cash out Kordestani's shares worth over $20 million. Kordestani joined Twitter's board in 2015 and served as executive chairman until 2020.

Susan Wojcicki, former Google executive and YouTube CEO, has died at 56 after battling cancer. A key figure in Google's growth since 1998, she shaped its advertising business and led major acquisitions like YouTube and DoubleClick. Wojcicki became YouTube's CEO in 2014 and stepped down in 2023 due to health issues, leaving a lasting impact on the tech industry.

Other Major News

• OpenAI fears users will become emotionally dependent on its ChatGPT voice mode. (Scroll To Tech Updates)

• Anysphere, a GitHub Copilot rival startup raised $60 million from a16z. (Scroll To Fundraising Updates)

• Amazon is partnering with TikTok and Pinterest (Scroll To Tech Updates)

• How to Validate Consumer Startup Ideas with 'Do Things That Don't Scale’?. (Scroll To Featured Article)

• Under the “Break Into VC” initiative we have launched our all-in-one VC Interview guide (how to answer) for aspiring venture capitalists. All of these questions and answers are curated from VC partners… For the first 50 aspiring venture capitalists, we are offering a 50% discount. Check out here…

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🗞️ Startup Funding Updates

CloudPay, a global payroll and payments services provider based in Raleigh, has raised $120 million in a new funding round, bringing its total raised to $228 million. The company, which processes over 3 million pay slips annually for 280 enterprise clients in 130+ countries, received investment from Blue Owl Capital, Rho Capital Partners, The Olayan Group, and Hollyport Capital. More Here

Anysphere, a GitHub Copilot rival startup developing an AI-powered coding assistant called Cursor, has raised over $60 million in a Series A round at a $400 million post-money valuation. The company, founded by MIT students and based in the United States, received funding from co-leaders Andreessen Horowitz and Thrive Capital, with participation from Patrick Collison, CEO of Stripe. More Here

DevRev, a Palo Alto, CA-based provider of an AI-native platform that unifies customer support and product development, raised $100M in Series A funding, at $1.1 Billion valuation. The round was led by Khosla Ventures, Mayfield Fund, and Dheeraj Pandey’s family office, Param Hansa Values, in addition to accelerators and family offices of tech CEOs and VCs. More Here

Myavana, an Atlanta, GA-based company which specializes in AI-driven personalized hair care, raised $5.9M in Seed funding. Backers included Prisma Ventures, H/L Ventures, New Age Capital, BrainTrust, Duo Partners, REFASHIOND Ventures, Resilient Ventures, Amazon, Reform Ventures, and NGC Capital. More Here

Userled, a London, UK-based AI-powered startup transforming how B2B companies create and manage personalised marketing campaigns at scale, raised £4M in Pre-Seed funding. The round was led by LocalGlobe, with participation from Dig Ventures. More Here

Clare&me, a Berlin, Germany-based AI mental health tech startup, raised $4M in funding. The round was led by YZR with participation from Kodori Ventures, Material Ventures, angels, and Antler. More Here

Blockscout, a Seychelles based open-source block explorer for all EVM-based chains, raised $3M in Seed funding. The round was led by 1kx, with participation from Primitive Ventures and Gnosis, and angels including Evan Van Ness, Alex Svanevik, Kartik Talwar, Anton Bukov, and Stefan George. More Here

Rich Data Co, a Sydney, Australia-based company which specializes in artificial intelligence (AI) decisioning for business and commercial lenders, raised additional $9M in Series B funding. The round was led by Acorn Capital. More Here

Miru Smart Technologies, a Vancouver, BC, Canada-based developer of electrochromic windows (eWindows), raised $20M in Series A funding. The round was led by Business Development Bank of Canada’s investment arm, BDC Capital, and Angelo Paletta of TNG Capital Corp., with participation from Greensoil Proptech Ventures. More Here

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📰 Venture Capital Updates

Flint Capital, a Boston-based venture firm, has closed its third fund at $160 million, quadrupling the size of its initial 2013 fund. The capital will be evenly split between early and late-stage investments, focusing on IT, cybersecurity, fintech, and digital health startups.

📌 Featured Article

How to Validate Consumer Startup Ideas with 'Do Things That Don't Scale’?

“Do things that don't scale" - Paul Graham made this idea famous in his 2013 essay. But I've noticed a lot of founders still don't get it. I see many of them, right from the start, trying to build products that are fully automated or can handle tons of users. Here's the thing - that's often a mistake.

Instead, why not focus on making your product or service the absolute best it can be, even if it means doing things by hand? Maybe you're personally answering every customer chat or writing each social media post yourself. That's okay! This hands-on approach lets you understand what your users want and if your idea works. It's way easier to figure out how to grow something people love than to fix something that flopped because you automated too soon. Start by doing things in a way that might not work long-term, but gives users an amazing experience.

Then, once you know what people care about, you can work on making those parts more efficient. Most founders ignore this path because they think this can’t be how the big, famous startups got started. However, they underestimate the power of compound growth. In this video (A Conversation with Paul Graham), he explains -

I have studied 50+ successful startups' early journeys and found the same trend. They follow the 'Do things that don't scale' strategy early on, which sets them apart from others in their domain.

We haves shared in detailed writeup in our Venture Curator newsletter, Check out here…

📑 Startup’s Latest Buzz

Acquisition & Going Public

Nobl Q, a Dallas, TX-based global AI- and cloud-based solutions provider, acquired Propel, a software developer that specializes in advanced technology solutions.

HCLSoftware, the Santa Clara, CA-based software business division of HCLTech, announced its intent to acquire Zeenea, a Paris, France-based innovator in data catalog and governance solutions.

Sendsprint, a Totowa, New Jersey-based international payment and remittance startup, has acquired Nobel Financial Inc., a NJ-based global remittance service provider.

Layoffs & Bankruptcy

Cisco plans to cut thousands of jobs in a second round of layoffs this year, focusing on high-growth areas like cybersecurity and AI. The cuts, potentially affecting more than 4,000 employees, may be announced with Q4 results.

Startups & People

Oyo, Indian hotel chain startup once valued at $10 billion, has seen its valuation drop to $2.4 billion in a new $173.5 million funding round. The Indian budget hotel chain's current valuation is now below its total capital raised of approximately $3.3 billion. This follows Oyo withdrawing its IPO plans earlier this year and amid various controversies surrounding the company.

🤖 Latest In Emerging Tech

OpenAI is concerned that users may become emotionally dependent on ChatGPT due to its new, human-sounding voice mode, which could affect relationships and social interactions. The company observed users expressing shared bonds with ChatGPT's voice mode, raising fears that prolonged use could reduce the need for human interaction and lead to unhealthy trust in AI-supplied information. OpenAI plans to continue studying the potential for emotional reliance on its tools and aims to navigate the ethical and social implications responsibly while ensuring AI safety.

X, the social media platform owned by Elon Musk, is facing a series of GDPR complaints across nine European countries for using EU user data to train AI models without obtaining consent. Privacy group noyb, led by Max Schrems, filed these complaints, arguing that X lacks a valid legal basis for processing user data for AI training. While the Irish Data Protection Commission (DPC) has initiated legal action against X, noyb contends that this response is insufficient, particularly regarding the deletion of already ingested data.

Amazon has partnered with TikTok and Pinterest to allow users to shop directly within the social media apps without leaving the platforms. Users can link their Amazon accounts to TikTok or Pinterest, enabling real-time access to product details, pricing, and purchasing options while browsing. This strategy builds on Amazon's existing in-app shopping partnerships with Meta and Snap, aiming to capitalize on the growing trend of social media-driven e-commerce.

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