Melinda Gates Resigned From Gates Foundation & Slack Using Your Chats To Train AI Models

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👋 Hey, Sahil here! Welcome to today's quick rundown in the Venture Daily Digest Newsletter. I've got the scoop on startup fundraising, fresh VC funds, and some cool tech – all in just 5 minutes ☕! Today’s major updates include -

• Slack faces backlash for using user data without consent to train AI models.

• Doubao, ByteDance's AI chatbot, surpassed Baidu's Ernie Bot in downloads and monthly active iOS users in China last year.

• Neuralink is accepting applications for a second human trial participant to test its brain implant device.

• Two Chinese nationals, Yicheng Zhang and Daren Li, were charged by U.S. authorities in a cryptocurrency scam that laundered at least $73 million from defrauded victims.

• Melinda French Gates resigned from the Gates Foundation and plans to dedicate her additional $12.5 billion to support women and families.

• Crypto lender Genesis Global received court approval to return about $3 billion in cash and cryptocurrency to its customers in a bankruptcy liquidation.

• Featured Article : If you meet with five or six or eight VCs and they all say no, it’s not a coincidence.

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STARTUP FUNDING UPDATES

Kudos, a Los Angeles, CA-based provider of a AI-powered smart wallet service that automatically oprimize consumer rewards and benefits on purchase, raised $10.2M in Series a funding. The round was led by QED Investors with participation from Patron, The Points Guy founder Brian Kelly, Samsung Next, SV Angel, Precursor Ventures, The Mini Fund, Newtype Ventures, and the Four Cities Fund. More Here

Atraverse Medical, a San Diego, CA-based medical device company, raised $12.5M in Seed funding. This financing included investment from physicians, reputable venture investors, and successful medtech entrepreneurs. More Here

Hyble, an Edinburgh, Scotland, UK-based provider of marketing technology to the global drinks and hospitality sector, raised £2.8M in funding. The investment, was made by BGF. More Here

Allied OMS, a Southlake, TX-based management services organization (MSO) for oral and maxillofacial surgery practices, closed a $116M credit facility. Backers included KeyBanc Capital Markets, BankUnited, N.A., Umpqua Bank, and First-Citizens Bank & Trust Company. More Here

Yendo, a Dallas, TX-based provider of a vehicle-secured credit card, raised $165M in debt financing. i80 Group provided $150M in debt financing while Yendo also raised $15M in equity from undisclosed strategic investors. More Here

Turbine, a Budapest, Hungary-based predictive simulation company that is building a platform for interpreting human biology, received an undisclosed investment from Accenture (NYSE: ACN), through Accenture Ventures. More Here

CoLab Software, a St. John’s, Newfoundland, Canada-based technology company building collaboration solutions for mechanical engineering and hardware development teams, raised $21M in funding. The round was led by Insight Partners with participation from existing major investors, including Y Combinator, Killick Capital, and Pelorus VC. More Here

GoodShip, a Nashville, TN-based provider of a platform for freight network orchestration and procurement, raised $8M Series A funding. goodship The round was led by Bessemer Venture Partners with participation from Ironspring Ventures, Chicago Ventures, FUSE VC, Cercano Management, 53 Stations, Andrew Silver, Nichole Wischoff, and other angels. More Here

Expanso, Seattle, WA-based distributed compute company, received an undisclosed strategic investment from Samsung Next. More Here

Angel AI, a Nashville, TN-based provider of a parent-designed AI platform that provides an age-appropriate internet experience for children aged 5 to 12 years old, raised $4.75M in Seed funding. The round was led by Cortical Ventures with participation from Village Global and other angel investors. More Here

Voxel51, an Ann Arbor, MI-based company which specializes in visual AI, raised $30M Series B funding. The round was led by Bessemer Venture Partners, with participation from new investor Tru Arrow Partners and existing investors Drive Capital, Top Harvest Capital, Shasta Ventures and ID Ventures. More Here

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VENTURE CAPITAL UPDATES

Shilling, A Portuguese venture firm has launched a €50 million "Opportunity Fund" to invest in growth-stage startups, both from its own portfolio and new companies. The fund aims to address the gap in funding for growth-stage startups in Portugal, which has a vibrant startup ecosystem but one of the lowest VC investment-to-GDP ratios in Europe. Over 90% of the €50 million target was raised at the first close, and the fund has already invested in Shilling portfolio company Coverflex. More Here

FEATURED ARTICLE

If you meet with five or six or eight VCs and they all say no, it’s not a coincidence.

Many founders come across posts like 'Startup founder secures funding after pitching to 100 VCs' and feel motivated to pitch to as many investors as possible.

I agree that one "no" doesn’t mean anything—the VC could just be having a bad day.

But If you meet with five or six or eight VCs and they all say no, it’s not a coincidence. There is something wrong with your plan.

As previously said, many founders are inspired by stories of startup founders securing funding after pitching to numerous VCs, but they often overlook the fact that these successful founders continuously refined their plans with each pitch.

Meeting with more VCs after a bunch have said no is probably a waste of time. Instead, retool your plan—which is what this post is about.

Remember VCs rarely actually say “no”—more often they say “maybe”, or “not right now”, or “my partners aren’t sure”, or “that’s interesting, let me think about it”.

They do that because they don’t want to invest in your company given the current facts, but they want to keep the door open. And that’s exactly what you want—you want to be able to go back to them with a new set of facts, and change their minds, and get to “yes”.

The second thing consider is funding environment which influence more in fundraising. (But not in founder's control...) so focus on retooling your plans...

I know this is hard — changing the facts of your plan and what you are trying to do, to make your company more fundable. But do it..

So how do you retool your plans? - Consider the onion theory of risk.

Investor, look at the risk around an investment as if it’s an onion. Just like you peel an onion and remove each layer in turn, risk in a startup investment comes in layers that get peeled away—reduced—one by one.

Your challenge as an entrepreneur trying to raise venture capital is to keep peeling layers of risk off of your particular onion until the VCs say “yes”—until the risk in your startup is reduced to the point where investing in your startup doesn’t look terrifying and merely looks risky.

What are the layers of risk? 🧅

• Founder Risk: Evaluate team dynamics; consider adding or replacing founders if needed.

• Market Risk: Validate the market practically; seek paying customers or credible prospects.

• Competition Risk: Ensure strong differentiation; avoid claiming no competition.

• Financing Risk: Rethink and reduce future funding needs; optimize your financial plan.

• Technology and Product Risks: Build and demonstrate your product; focus on progress.

• Hiring Risk: Add crucial positions to the founding team if concerns arise.

Remember, the key is to make progress, build product, and continuously peel away risks to optimize chances of securing fund. Adapt, refine, and repeat until you hear that coveted "yes"!

STARTUP’S LATEST BUZZ

ACQUISITION & EXITS

Accenture (NYSE: ACN) is to acquire Openstream Holdings (Tokyo, Japan-based) and its subsidiaries, Open Stream and Neutral. More Here

LAYOFFS & BANKRUPTCY

Crypto lender Genesis Global received court approval to return about $3 billion in cash and cryptocurrency to its customers in a bankruptcy liquidation. This leaves its owner, Digital Currency Group, with no recovery from the bankruptcy. The judge overruled DCG's objection that customers should be paid based on January 2023 crypto prices, instead allowing payments based on current higher prices. Genesis estimated it will be able to pay customers up to 77% of their claims' value. More Here

STARTUPS & PEOPLE

Melinda French Gates resigned from the Gates Foundation and plans to dedicate her additional $12.5 billion to support women and families. The tech industry's "bro culture" and mistreatment of women engineers is a major issue. French Gates aims to address structural barriers preventing women's advancement through her organization, Pivotal Ventures. More Here

Neuralink is accepting applications for a second human trial participant to test its brain implant device. The first trial participant experienced an issue with the implant, but adjustments were made to improve its function. Neuralink aims to help paralyzed people control computers and regain abilities through brain-computer interfaces, but widespread consumer access is still years away. More Here

Activist investor Elliott Investment Management has built a position worth over $1 billion in Johnson Controls International Plc. The move follows Johnson Controls' attempts to divest its heating and ventilation assets worth over $6 billion. More Here

After Apple allowed game emulators on the App Store, the Delta emulator quickly rose to the top of the charts, gaining millions of downloads. Adobe threatened legal action against Delta, claiming its logo resembled Adobe's own. Delta changed its logo to a broken triangle design to avoid potential legal issues. While successful, Delta's sudden popularity also brought increased scrutiny from larger companies. More Here

Didi Global's co-founder Jean Liu has stepped down from her roles as president and board director, transitioning to a new role as "permanent partner." Liu will focus on long-term development, talent, and corporate social responsibility. The company will no longer have a president position after Liu's transition. More Here

Two Chinese nationals, Yicheng Zhang and Daren Li, were charged by U.S. authorities in a cryptocurrency scam that laundered at least $73 million from defrauded victims. Zhang was arrested in Los Angeles, while Li, a dual citizen of China and St. Kitts and Nevis, was arrested in Atlanta earlier. They are accused of being involved in a "pig butchering" crypto investment scam, inducing victims to deposit funds into U.S. bank accounts, which were then laundered through financial institutions to the Bahamas. More Here

LATEST IN EMERGING TECH

OpenAI's Superalignment team, responsible for developing ways to govern and steer "superintelligent" AI systems, faced challenges with resource allocation and leadership priorities, leading to resignations of key members like Jan Leike and Ilya Sutskever.

They believed more focus should be on safety, security, and preparedness for advanced AI systems. OpenAI will now integrate the team's work across divisions, raising concerns about the company's commitment to safety-focused AI development. More Here

Crypto startup funding rose to $2.4 billion in Q1 2024, driven by expectations of lower interest rates and the launch of the first U.S. bitcoin spot ETFs. Infrastructure-focused startups led the way, with Together AI raising $106 million in the largest deal. While funding increased, exits remained low, though more M&A activity is expected among exchanges and infrastructure providers as the market matures. More Here

TikTok Parent ByteDance Now Has China’s Most Popular AI Chatbot: Doubao, ByteDance's AI chatbot, surpassed Baidu's Ernie Bot in downloads and monthly active iOS users in China last year. ByteDance has made AI a priority, with CEO Liang Rubo emphasizing urgency.

While the data excludes Android, it illustrates the wider AI race in China among tech giants and startups. Monetization remains challenging due to free services and trade restrictions on AI chips. More Here

Blue Origin conducted its first crewed launch since 2022 on May 19th, carrying six space tourists into space. One of the passengers was Ed Dwight, who trained for NASA's space program in the early 1960s but was not selected as an astronaut. After a successful launch and brief period of weightlessness, the New Shepard rocket and capsule safely returned to Earth. More Here

Slack faces backlash for using user data without consent to train AI models. Despite acknowledging the practice, their response fails to address concerns over data privacy, opt-in approach, and policy inconsistencies. More Here

The EU Commission demands Microsoft provide internal documents on Bing's generative AI risks like misinformation and deepfakes. Failure to comply by May 27 could result in fines up to 1% of annual revenue for violating the Digital Services Act. Bing's AI integration has led to misinformation and concerning user experiences, especially regarding elections. More Here

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HOW’S TODAY’S COFFEE ?

That’s It For Today! Will Meet You Tomorrow. Happy Monday!☕

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