OpenAI Co-founder leaves To Join Anthropic & AI Chip Startup Groq Raised $640 Million

☕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

John Schulman, co-founder of OpenAI, has left to join rival AI startup Anthropic.

OpenAI president Greg Brockman is taking an extended leave, while product manager Peter Deng has also exited. Schulman aims to deepen his focus on AI alignment at Anthropic.

Groq, a Mountain View, CA-based company which specializes in fast AI inference, has secured a $640M Series D, at $2.8 Billion valuation led by BlackRock Private Equity Partners to challenge Nvidia's dominance in AI chips.

Other Major News

• China launches first satellites of constellation to rival Starlink (Scroll To Tech Updates)

• Elon Musk is suing OpenAI and Sam Altman again (Scroll To Tech Updates)

• Elon Musk's social media platform X (formerly Twitter) will close its San Francisco office. (Scroll To Tech Updates)

• Why Crowdfunding doesn’t Work? - Read This Before You Raise Crowdfunding for Your Startup…(Scroll To Featured Article)

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🗞️ Startup Funding Updates

Placer.ai, based in Los Altos, CA, provides location-based analytics for various industries using AI and anonymized data from third-party apps. The startup raised $75 million, with investors including GEM Realty Capital, Josh Buckley, WndrCo, Lachy Groom, MMC Technology Ventures, Fifth Wall Ventures, and Array Ventures. More Here

Hyperbolic, a New York-based provider of GPU resources and AI services through a cloud platform, raised $7m in seed funding. The round was led by Polychain Capital and Lightspeed Faction with participation from Chapter One, LongHash, Bankless Ventures, Republic Digital, Nomad Capital, CoinSummer Labs, Third Earth Capital, and angel investors like Balaji Srinivasan, Illia Polosukhin, Sandeep Nailwal, Casey Caruso, Tekin Salimi, Santiago Santos. More Here

Morpho, a Paris, France-based provider of a decentralized cryptocurrency lending protocol, raised $50M in funding. The round was led by Ribbit Capital with participation from a16z crypto, Coinbase Ventures, Variant, Pantera, Brevan Howard, BlockTower, Kraken Ventures, Hack VC, IOSG, Rockaway, L1D, Semantic, Mirana, Cherry, Fenbushi, LeadBlock Bitpanda Ventures, Robot Ventures and 40+ others. More Here

Contextual AI, a San Francisco, CA-based startup that builds customized language models for businesses to enhance their AI applications, raised $80m Series A funding round. The round was led by Greycroft with participation from Bezos Expeditions, NVentures, HSBC Ventures, and Snowflake Ventures as well as existing investors Bain Capital Ventures, Lightspeed Ventures, Lip-Bu Tan, Conviction, and Recall Capital. More Here

NanoHive Medical, a Boston, MA-based company which specialises in 3D-printed titanium spinal interbody fusion devices, raised $7M in Series C funding. Backers were not disclosed. More Here

Muon Space, a Mountain View, CA-based end-to-end space systems provider, raised $56M in Series B funding. The round was led by Activate Capital. Acme Capital and existing investors Costanoa Ventures, Radical Ventures, and Congruent Ventures also participated. More Here

Cartridge, an infrastructure provider for provable onchain games and autonomous worlds, raised $7.5M in Series A funding. The round was led by BITKRAFT Ventures. StarkWare, Fabric Ventures, Dune Ventures, Primitive Ventures, and Ergodic Fund also participated. More Here

Savvy Wealth, a NYC-based digital-first platform for financial advisors, raised an additional $15.5m funding. The round was led by Canvas Ventures with participation from existing and new investors including Thrive Capital, Brewer Lane Ventures, Index Ventures, The House Fund and Alumni Ventures. More Here

stabble, a Dubai, UAE-based provider of a Solana-based protocol established to minimize financial loss by reducing operational costs, raised $2.5M in a combined pre-seed, seed, and private funding round. The round was led by Masterblox with participation from Dynamic Labs, Founder Heads, Spicy Capital, DuckDAO, Marshland Capital, and ZEMU VC. More Here

Skillfully, a San Francisco, CA-based company which specializes in simulation-driven hiring solutions, raised $2.5M in seed funding. The round was led by Better Ventures, with participation from Silicon Valley Quad, American Student Assistance, Strada Education Foundation, FN Fund, and Inventus Capital Partners. More Here

Neupulse, a University of Nottingham (UK) spinout, has secured a £500k in equity funding. The funding was raised through the Midlands Engine Investment Fund II, facilitated by appointed fund manager for the East and South East Midlands, Mercia Ventures. More Here

Assisterr, a Cambridge, UK-based AI Infrastructure startup, raised £1.3M in Pre-Seed funding. Backers included Web3.com Ventures, Moonhill capital, Contango, Outlier Ventures, Decasonic, Zephyrus Capital, Wise3 Ventures, Saxon, GFI Ventures, X Ventures, Koyamaki, Lucid Drakes Ventures, and angels, including Michael Heinrich, co-founder & CEO at 0g.ai, Mark Rydon, co-founder & CEO at Aethir, Nader Dabit, Director of Developer Relations at Eigen Labs, Anthony Lesoismier-Geniaux, co-founder at SwissBorg, Ethan Francis, Head of Developer Relationships at Particle Network and more. More Here

Shot Scope Technologies, an Edinburgh, Scotland, UK-based golf technology company, raised £6.6M in Debt and Series B funding. The round was led by Guinness Ventures, which invested £3.1M, and included participation from Scottish Enterprise, Growthdeck, The SideBySide Partnership, and Edinburgh based Equity Gap. Virgin Money provided £1.5M in debt finance as part of the round. More Here

Chromacity, an Edinburgh, Scotland, UK-based laser technology business, raised over £1M in funding. Backers included Eos Advisory, Kelvin Capital, Scottish Enterprise and UK Government’s Innovate UK programme. More Here

Hedra, a San Francisco, CA-based provider of AI-powered tools for generating video content with human characters, raised $10m in seed funding. Backers included Index Ventures, Abstract, and Andreessen Horowitz, as as well as Jon Barron, David Benhaim, Kevin Hartz, Greg Mark, Robyn Peterson, Nikhila Ravi, John Rogovin, Bilawal Sidhu, and Outset Capital. More Here

Amlogenyx, Inc., a Beverly Hills, CA-based subsidiary of Ultragenyx Pharmaceutical, Inc. (NASDAQ: RARE) which is researching and developing novel gene therapies for Alzheimer’s disease and other amyloid diseases, completed a seed funding round of USD 14m. The seed round was led by GordonMD® Global Investments LP and associated investors, as well as Ultragenyx. More Here

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📰 Venture Capital Updates

Knox Lane, a San Francisco, CA-based growth-oriented investment firm, announced the final close of its second institutional fund, KLC Fund II, with $1 Billion in total commitments. The fund received support from existing and new investors and saw a 64% increase in fund size over Knox Lane’s first fund, which was $610M. With the close of KLC II, Knox Lane now manages approximately $3 Billion.

📌 Featured Article

Why Crowdfunding doesn’t Work?

Investing in an early-stage private company is both an opportunity and a privilege. But can the privilege be crowdsourced?

Equity crowdfunding is a great move forward in democratizing investing and introducing more capital to private markets. But, it's generally a bad idea to have ‘strangers’ on your cap table, when you're an early-stage private co, especially before PMF.

Think of this as a bunch of random folks who came to speculate and create noise while you're still figuring out how to make your thing work. There have been many such examples in crypto that eventually added to the controversial reputation of this incredible tech ecosystem.

Crowdfunding finds its best application in real-world assets like real estate, where you can buy a piece of a real cashflow-generating business with a check size of as little as $10. It works for the issuer too, as they require substantial raw capital to make those deals work.

This could also be beneficial for emerging consumer brands that want to give a small ownership stake to their fanbase. But it’s not a good deal for most early-stage companies.

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

📑 Startup’s Latest Buzz

Acquisition & Going Public

Intellias, a Chicago, IL-based software engineering and digital consulting company, acquired NorthLink Digital, a UK-based IT consultancy specializing in financial services and insurance (FS&I). More Here

Layoffs & Bankruptcy

Rad Power Bikes, a Seattle-based e-bike startup, has undergone its fifth round of layoffs since April 2021, with the latest cuts primarily affecting product development teams. The company, which has raised over $300 million from investors, cited rising costs and economic headwinds as reasons for the decision.

Startups & People

A YouTube creator is pursuing a class action lawsuit against OpenAI, claiming the company trained its AI models on millions of YouTube video transcripts without notifying or compensating the creators, violating copyright law and YouTube's terms of service. David Millette, represented by Bursor & Fisher, seeks over $5 million in damages for affected YouTube users. OpenAI allegedly used Whisper to transcribe over a million hours of video from YouTube for training purposes.

Elon Musk's social media platform X (formerly Twitter) will close its San Francisco office which marks the ending of the company's presence in the city where it was founded in 2006.

🤖 Latest In Emerging Tech

A Chinese state-owned enterprise launched the first batch of satellites for its "Thousand Sails Constellation," aiming to rival SpaceX's Starlink with a planned 15,000 low Earth orbit satellites by 2030. The launch, led by Shanghai Spacecom Satellite Technology (SSST) at Taiyuan Satellite Launch Centre, is part of China's strategic goal for near-global internet coverage and has military implications.

SoftBank Group Corp. is expected to report a small profit of ¥1 billion ($6.9 million) for the June quarter, a modest improvement from last year's ¥477.6 billion loss. The Tokyo-based investment firm's stock plunged due to concerns over AI's profitability, recovering slightly the next day. CEO Masayoshi Son is gearing up for a significant AI investment, with plans to deploy $100 billion into AI-related chips, leveraging the IPO of Arm Holdings Plc.

Elon Musk has filed a new lawsuit against OpenAI, Sam Altman, and Greg Brockman, accusing them of breaching the company's founding mission to benefit humanity with artificial intelligence. The lawsuit alleges that Altman and Brockman manipulated Musk into co-founding OpenAI by promising it would be safer and more transparent than profit-driven alternatives. Musk previously withdrew a similar lawsuit in June, but the new suit claims that OpenAI violated federal racketeering laws and manipulated its contract with Microsoft.

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