VC Daily Digest - 02/09/2023

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Your Monday to Saturday Daily Dose of Venture Insights, Funding Updates and Startup Stories Delivered Straight to Your Inbox. Stay Informed, Stay Inspired and Stay Ahead In the World of Venture Capital !

📢 Top Venture Capital News

Private fund managers report feeling a squeeze on fees: Private fund managers have reported feeling pressure to reduce their fees in order to secure LP commitments amid a competitive fundraising environment. Industry participants say private fund managers have had to offer larger-than-normal fee discounts over the first half of 2023 in order to secure commitments in a timely first or second close. "In the first half of this year, LPs seem to have had more leverage on fees," said Allan Majotra, the founder and managing partner at 5Capital Fund Placements. More Here

Hedge Funds and Private Equity Challenge the SEC’s New Rules: The hedge fund and private equity industries are taking a stand against the Securities and Exchange Commission's (SEC) new regulations. Trade groups representing these private fund advisers have filed a petition in the U.S. Court of Appeals, challenging the rules they believe could impact their operations. It's a bold move, signaling the industry's willingness to push back against regulatory changes they deem unfavorable. More Here

New IPOs offer a true reflection of late-stage VC valuations: If an alternative asset manager delivers strong returns for investors with one fund, is that any indication they can do it again? Sometimes, but that information is of little value to LPs as they make decisions on where to invest their capital, PitchBook's quantitative analysts share in a new report. The performance of a general partner's previous private investment funds can predict future fund performance to a degree, but that's only with at least eight years of hindsight, according to PitchBook's latest Allocator Solutions report. More Here

Ohio ready to invest $111M in VC funds from federal Covid relief: Ohio is ready to invest $111 million to become a limited partner in venture capital funds investing in tech startups. About a third of the money will be channeled to founders who have historically been left out of VC, such as women, members of ethnic minorities and rural residents. The Department of Development started accepting proposals from organizations and investment firms last week, according to a release. The private groups must match the state investment dollar-for-dollar. More Here

Scott Burns, who sold GovDelivery for $153M, joins Mairs & Power Venture Capital: Scott Burns has joined Mairs & Power Venture Capital as a general partner. Burns’ 25-year career includes extensive experience supporting entrepreneurs and his own successful ventures. He was the founder of Structural and GovDelivery, the latter of which sold for $153 million in 2016 and the former sold for an undisclosed amount last October. More Here

📢 Top Startups News

AI’s Share Of US Startup Funding Doubled In 2023: Artificial Intelligence (AI) is taking center stage in the startup investment landscape. Crunchbase data reveals that over 1 in 4 dollars invested in American startups this year went to AI-related companies, more than double the share from last year. Despite a downturn in overall startup investment, AI has proven resilient, with its funding share increasing even as total investment shrinks. Interestingly, AI's growth isn't confined to a specific sector; it's a set of technologies applicable across industries, suggesting that companies with compelling AI pitches are faring better in securing funding. More Here

All that fintech investment had a real impact on banking penetration in Latin America: Startups, particularly in the fintech sector, have had a profound impact on financial access in Latin America, despite a recent contraction in the global venture capital market. A new report from Atlantico reveals a 65% decline in venture capital volumes in Q2 2023 compared to the previous year, indicating a significant reduction in fintech investment. However, the influence of startups in the region is undeniable, with bank account penetration rising from 55% to 74% post-2017, a trend that can be linked to the influx of capital during the last venture boom. More Here

All products are garbage, and for good reason: In a world abundant in resources and technology, it's puzzling to see a trend towards lower quality and disposability in consumer goods. Despite economic prosperity enabling more people to afford high-quality products, it's becoming increasingly challenging to find durable goods that are built to last. This paradoxical phenomenon in late-stage capitalism is reminiscent of Adam Savage's rule of tools and Sam Vimes’ boots theory, both of which highlight the economic implications of short-term versus long-term investment in products. Why do companies continue to sell us products that are built to fail, ensuring we'll need replacements soon enough? It's a question worth pondering. More Here

📢 Featured: Today’s Featured Tweet

Is it Better To Target A Small Market or A Large One?

Mike McGuiness shared a awesome tweet on targeting small or large market - where he shared a video of peter thiel talking about the framework of evaluating the markets. Look at this. 👇

📢 Top AI News

X’s privacy policy confirms it will use public data to train AI models: In a recent update to its privacy policy, X has announced its intention to collect biometric data, job and education history from its users. This data, along with other publicly available information, will be used to train the company's machine learning and AI models. The change, spotted by Alex Ivanovs of Stackdiary, has led to speculation that X's owner, Elon Musk, may be planning to use this data for his AI venture, xAI. Musk has confirmed that only public data will be used, and no private information will be accessed. More Here

Could AI be the spark that ends the opioid epidemic?: The opioid epidemic, a complex issue that has stumped researchers for nearly two decades, is now being approached with a new tool - artificial intelligence (AI). Despite the healthcare industry's notorious slow adoption of new technology, costing it over $8.3 billion annually, AI is being explored as a potential game-changer in addiction prevention and treatment. AI innovations are being used to identify individuals at risk of developing opioid use disorder, disengaging from treatment, and relapse, and even to detect signs of overdose and automatically administer life-saving treatment. It is crucial that researchers, clinicians, patients, and the broader public work together to ensure the responsible use of AI in addressing this pervasive issue. More Here

How to buy an AI solution the right way: 7 questions new customers should consider?: AI is set to revolutionize our lives, but understanding its potential and application is crucial. As we navigate this emerging space, it's important to evaluate AI solutions in terms of their current value, scalability, and interaction with existing technology. Key considerations include data security, compliance, and the ability to adapt over time. Remember, AI isn't just an incremental solution - it's a tool that can completely remove pain points and transform your business. But, it's essential to keep control of your data and ensure your AI solution is built with an understanding of the evolving ethical landscape. As AI models age, they can drift, so ask vendors how they keep their models up-to-date and manage changes. AI is not just about the future, it's about what it can do for you today. More Here

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📢 Top Startup’s Fundraising News

Innovac Therapeutics Completes $18 million Series Pre-A Financing To Fund the Development of Its lead Programs and Manufacturing Capabilities: Innovac Therapeutics, an mRNA therapeutics company, has successfully completed an $18 million Series Pre-A financing round. With investments from Elikon Venture, Vision Plus Capital, Yunion Healthcare Ventures, and TG Sino-Dragon Fund, among others, the funding will be used to further develop Innovac's technology platform and manufacturing capability, propelling its lead programs into the clinical stage. More Here

Martian Lawyers Club raises $2.2M for AI-based game personalization tech: The Martian Lawyers Club (MLC) is revolutionizing game personalization with generative AI, focusing on the core systems rather than content. Co-founded by Kamen Brestnichki and Levi Fussell, MLC aims to create games that feel like a conversation, with player input and game response not pre-defined by the developer. They've raised a $2.2 million pre-seed round and are developing an SDK for a sandbox experience, allowing developers to design without creating every game interaction from scratch. MLC's first project is a collectible card game, testing the potential of their innovative technology. More Here

Meet Superframe, the AI startup that wants to be your copilot for revenue operations raised $5M: AI-powered software company, Superframe, has successfully raised $5 million in seed funding, marking a significant milestone in their journey to optimize businesses' go-to-market technology stacks. Their first product, an AI assistant for managing complex Salesforce implementations, promises to save companies time and money by making configuration changes fast, safe, reliable, and easy. More Here

Pirros, a startup that applies AI to streamline drawing sets for buildings and infrastructure, lands $2 million seed round: Pirros, a tech platform revolutionizing the way architecture and engineering firms manage their drawing sets, has successfully raised a $2 million seed round. The platform streamlines detail management by automatically categorizing and cataloging drawing sets, addressing the inefficient paradigm of creating, using, and discarding design details. With Pirros, professionals can focus more on designing buildings rather than documenting them, as all outputs are centrally stored and managed for easy future re-use. More Here

🗞️ Interesting Weekday Reading On: Startups, Technology & VC

• 📰 Why it's Better To Raise Less Capital In The First Round? Read More

• 📮 Why Your Startup Idea Isn’t Big Enough for Some VCs? Read More

• 📪Hidden Trap Of Convertible Note and Liquidation Preference Multiples Read More

• 📑 Decoding Sequoia Capital: How Do They Dominate the VC Landscape? Read Here

• 📑 How To Convince Investors That Your Startup Can Give Maximum Return To Them? Read Here

• 🗃️ How Do Investors Protect Themselves from Down rounds ? Read Here

• 📜 How VCs Evaluate & Make High-Quality Investment Decisions? Read More

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✍️Written By The Venture Crew Team

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