Microsoft Paying Millions To Inflection's VCs & Reddit's IPO

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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!

• Microsoft's acquisition of Inflection AI involves a substantial payout of approximately $650 million.

• Reddit's IPO being the second-largest exit from Sam Altman's portfolio worth of $413 Millions.

• Frontline Ventures, Fullerton Fund Management, World Fund & Silence launched $200M, $100M, $300M & $30M VC fund respectively.

• OKX, a crypto exchange, is halting services for users in India by April-end due to regulatory concerns.

• Featured Article : How Did Successful Startups Use Paul Graham’s “Do Things That Don’t Scale” Strategy?

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STARTUP FUNDING UPDATES

The Browser Company, which makes the Arc browser, has raised $50 million in a round led by Pace Capital at a $550 million valuation. More Here

Cemvision, a Stockholm, Sweden-based climate tech company, raised €10M in funding. The round saw participation from Polar Structure and BackingMinds, and Zacua Ventures. More Here

Rails, a decentralized crypto exchange, raised $6.2 million led by Slow Ventures, with investment from CMCC Global, Round13 Capital, and Quantstamp. The startup aims to bridge the gap in crypto exchanges, prioritizing customer deposit safety and offering a hybrid model of centralized risk management and decentralized custody. More Here

Pelikan Mobility has been building a platform and a leasing solution that address this challenge caused by the switch to EVs for commercial fleets. The French startup raised a €4 million (about $4.4 million at today’s exchange rate) seed round from Pale Blue Dot, Frst, Seedcamp and others. More Here

Foundry, a Palo Alto, CA-based provider of a public cloud for AI/ML workloads, raised $80M in Seed and Series A funding. The round was led by Sequoia Capital and Lightspeed Venture Partners. More Here

Eisbach, a Martinsried, Germany-based clinical-stage biotechnology company, received $4.5M from Cancer Focus Fund. More Here

Copilot, a subscription-based personal finance tracker, is thriving following the discontinuation of Mint, with over 100,000 subscribers and a recent $6 million Series A funding round led by Nico Wittenborn's Adjacent. More Here

Coast, a NYC-based company offering a way to manage fuel and fleet spending, raised $92M in funding. The round included $25M in equity capital led by existing investors, including BoxGroup, Avid Ventures, Accel, Insight Partners, and Better Tomorrow Ventures, as well as new investor Vesey Ventures. The company also secured $67M in committed debt capital from Silicon Valley Bank and TriplePoint Capital. More Here

Loyal, a San Francisco, CA-based biotech company developing drugs for dogs, raised $45M in Series B funding. The round, which brought the total amount to $125M, was led by Bain Capital Ventures, with participation from Khosla Ventures, First Round Capital, Box Group, Collaborative Fund, Quiet Capital, and Todd & Rahul’s Angel Fund. More Here

Pandion, a Seattle, WA-based provider of a parcel network designed for e-commerce residential delivery, raised $41.5M in Series B funding. The round was led by Revolution Growth. More Here

Profluent, a Berkeley, CA-based AI-first protein design company, raised $35M in funding. The round was led by Spark Capital, with participation from existing investors Insight Partners and Air Street Capital along with a syndicate of angel investors from OpenAI, Salesforce, Octant Bio, and Google including Jeff Dean, Chief Scientist of Google DeepMind. Former Head of Product at OpenAI Fraser Kelton joined Board of Directors, along with Nabeel Hyatt, also a general partner at Spark Capital. More Here

LeakSignal, an Atlanta, GA-based provider of microservices cybersecurity solutions, raised $1.6M in Seed funding. The round was led by Shasta Ventures with participation from TFX Capital, Blu Ventures, and Cyber Mentor Fund. Previous investors included Tokyo Black, Vela Partners, and other prominent cybersecurity angels. More Here

Sevco Security, an Austin, TX-based provider of a cloud-native cyber asset attack surface management (CAASM) platform, raised $17M in funding. The round, which brought the total amount to $38M, was led by SYN Ventures, with participation from .406 Ventures, Accomplice, Bill Wood Ventures, and Washington Harbor Partners. More Here

BlueFlag Security, a Sunnyvale, CA-based identity-based developer security company, raised $11.5M in Seed funding. The round was led by Maverick Ventures and Ten Eleven Ventures with participation from Pier 88 Investment Partners. More Here

Tarsal, a NYC-based security data movement company, raised $6M in Seed funding. The round was led by Harpoon Ventures and Mango Capital, with participation from Y Combinator, Abstract Ventures, and Backend Capital. More Here

Firestorm Labs, a San Diego, CA-based unmanned aerial system (UAS) manufacturer, raised $12.5M in Seed funding. The round was led by Lockheed Martin Ventures. Other backers in the company included Decisive Point, Silent Ventures, 645 Ventures, Overmatch VC, BVVC, Marquee Ventures, Cubit Capital, IronGate, Backswing Ventures, The Veteran Fund, Feld Ventures, Beyond Capital, and RedCat. More Here

Cleric, a San Francisco, CA-based provider of AI-led solutions empowering automated infrastructure management, raised $4.3M in Seed funding. The round was led by Zetta Venture Partners with participation from AI infrastructure angel investors including leaders at Google Cloud, Sysdig, Tecton and Neo4J. More Here

Moondance Labs, a Tortola, British Virgin Islands-based provider of the Tanssi appchain infrastructure protocol, raised $6M in funding. The round was led by Scytale Digital, KR1, and SNZ, and saw participation from prominent blockchain venture capitalists including Arrington Capital, Borderless Capital, Hypersphere, and Blockchain Founders Fund. More Here

Holistic AI, a Palo Alto, CA-based provider of an AI governance platform, received an undisclosed investment from Mozilla Ventures. More Here

Ultrahuman, a Bangalore, India-based health monitoring company, based $35M in Series B funding. Backers included Blume Ventures, Steadview Capital, Nexus Venture Partners, Alpha Wave and Zomato founder Deepinder Goya. More Here

Borderless AI, a Toronto, Canada-based AI-powered startup for Employer of Record (EOR) space, raised $27M in Seed funding. The round was led by Susquehanna and Aglaé Ventures, with participation from additional undisclosed investors. More Here

NX Technologies, a Cologne, Germany-based fintech company that operates the automotive payment management platform bezahl.de, raised €22M in Series B funding. The round was led by PayPal Ventures, with participation from Seaya Ventures, Walter Ventures and existing investor Motive Ventures. More Here

Capstan Therapeutics, a San Diego, CA-based biotechnology company dedicated to advancing in vivo reprogramming of cells through RNA delivery using targeted lipid nanoparticles (tLNP), raised 175M in Series B funding. The round was led by RA Capital Management, with participation from new investors Forbion, Johnson & Johnson Innovation. More Here

AccessPay, a Manchester, UK-based bank integration provider, raised $24M in Strategic funding. The round was led by True Ventures, with participation from Praetura Ventures, NatWest, Mastercard, Route 66 Ventures, and Beringea. More Here

Fuel Me, a Chicago, IL-based provider of a fuel procurement and management platform, raised $18M in Series A funding. The round was led by Pritzker Group Venture Capital and Tribeca Venture Partners. More Here

Dryad Networks, a Berlin, Germany-based ultra-early wildfire detection technology company, announced the initial closing of €5.6M in convertible financing, with a total round size of up to €10M. The round saw participation from both existing and new investors. More Here

Blixt, a Kista, Sweden-based provider of a software-defined power system for the electricity sector, raised €5M in funding. The round was led by Union Square Ventures and Energy Revolution Ventures. More Here

Farm to Feed, an agtech startup in Kenya, addresses food loss by aggregating and selling imperfect produce from small- and large-scale farmers to businesses. With $1 million raised from various investors and institutions, including Catalyst Fund and IFC TechEmerge. More Here

VENTURE CAPITAL UPDATES

Frontline Ventures, a London, UK, Dublin, Ireland, and San Francisco, CA- venture capital firm focusing on B2B software companies, raised $200m across two funds. Frontline Growth and Frontline Seed will propel the transatlantic expansion of B2B software companies, fostering innovation in both North America and Europe. More Here

Fullerton Fund Management, a Singapore-based active investment firm, raised US$100M in the anchor close of its Fullerton Carbon Action Fund (the Fund). The fund will invest in market leading businesses in the manufacturing, industrials, energy, and electric vehicles/mobility sectors. More Here

World Fund, a Berlin-based VC focused on decarbonization technologies, closes its first fund at €300 million, backed by European Investment Fund and others amid challenging fundraising environment, aiming to make 25-30 investments in European startups. Notable investments include IQM Quantum Computers, Space Forge, and Planet A Foods. More Here

Silence, a new angel-style VC firm led by Borja Moreno de los Rios, has raised $35 million to invest in climate startups using the tech startup playbook. With a focus on neutrality and small investments ($300k average), they've already backed 22 companies, including Cardino, a successful used EV marketplace. More Here

Sameer Brij Verma, a big investor at Nexus Venture Partners, is leaving to start his own $150 million venture firm in India. He led successful investments in companies like Postman and Unacademy and plans to be more involved in helping startups, which is different from how most investors work. More Here

FEATURED ARTICLE

How Did Successful Startups Use Paul Graham’s “Do Things That Don’t Scale” Strategy?

“If a man has good corn or wood, or boards, or pigs, to sell, or can make better chairs or knives, crucibles or church organs, than anybody else, you will find a broad hard-beaten road to his house, though it is in the woods.”

Now, Emerson lived 150 years before the iPhone. However many believe the idea still resonates today - If you build a better mousetrap, people will find it naturally, and your startup will take off.

Simple, right? - In reality, building a better mousetrap is usually not enough. It’s not enough to be very good. To get something from 0 to 1 typically requires something remarkable It takes solving a problem others haven’t solved. Read More Here

STARTUP’S LATEST BUZZ

ACQUISITION & EXITS

Funds and accounts managed by KKR agreed to acquire a majority stake in Avantus, a U.S. developer of large utility-scale solar and solar-plus-storage projects at $1 Billion. More Here

OKX, a crypto exchange, is halting services for users in India by April-end due to regulatory concerns, following Apple and Google's removal of its app. The move aligns with India's tightening stance on cryptocurrency, enforcing anti-money laundering measures and taxing virtual currency transactions. More Here

LAYOFFS & BANKRUPTCY

Barclays layoffs are coming to the financial services company, which reportedly plans to cut hundreds of jobs to reduce operating expenses. More Here

STARTUPS & PEOPLE

Reddit's successful IPO, with shares closing nearly 48% above its IPO price, reflects investor enthusiasm despite its unprofitability. The company's AI strategy, evidenced by $203 million in contracts, adds promise, though an FTC inquiry into user data licensing may pose risks. Despite past tech IPO struggles, Reddit's debut, alongside Astera Labs', signals potential for a revitalized IPO market in 2024, buoyed by tech growth and Nasdaq's high performance. More Here

Reddit's IPO at $34 per share values the company at $6.37 billion, a decline from its peak valuation of $10 billion in 2021. Sam Altman, an early investor who led Reddit's Series B in 2014, holds shares worth $413 million. This success underscores Altman's prowess in angel investing, with Reddit's IPO being the second-largest exit from his portfolio. More HERE

LATEST IN EMERGING TECH

Microsoft's acquisition of Inflection AI involves a substantial payout of approximately $650 million, comprising $620 million for non-exclusive licensing and $30 million to avert potential litigation. Investors, including those in the early $225 million round, can expect returns of 1.5 times their investment, while later investors in the $1.3 billion round will see returns of 1.1 times their investment. The remaining entity will shift focus to assisting companies with large language model AI, following a pivot away from its initial chatbot project. Despite Microsoft's ties with OpenAI, concerns over regulatory scrutiny and internal conflicts persist, prompting the need for a backup strategy. Inflection's co-founders, hailing from Google DeepMind, bring invaluable expertise to Microsoft, yet regulatory implications and the company's reliance on OpenAI remain key considerations in this deal. More Here

The U.S. Justice Department's antitrust complaint against Apple focuses on Apple Pay's alleged stifling of competition and innovation, aiming to break Apple's control over tap-to-pay transactions and access to user data. Despite Apple's revenue growth from Apple Pay, the DOJ asserts it restricts market potential and consumer choice, with significant implications for the broader ecosystem. More Here

VENTURE DAILY DIGEST PICKS

• ​The One Slide, Most Founders Get Wrong When Fundraising. Read Here

• ​AI SaaS Companies Will Be More Profitable by Tomasz Tunguz. Read Here

• "Fundraising Is A Sales & Marketing Process In Which The Buyer Is a VC and the Product Is Equity, Why?" Read Here

• Marc Andreessen's Guide to Finding Product-Market Fit! Read Here

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That’s It For Today! Will Meet You On Monday!
Happy Weekend! 🥂

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✍️Written By Sahil R - The Venture Crew