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- VC Daily Digest - 17/11/2023
VC Daily Digest - 17/11/2023
Ex-VC Mike Rothenberg convicted of 21 counts of fraud; IRL founder caught defrauding investors with fake users.
Venture Daily Digest
November 17, 2023
📮Today’s Major News
Menlo Ventures closes on $1.35B in new capital, targets investments in AI startups
Thrasio Holdings, an aggregator of third-party sellers on Amazon Filed Bankruptcy
Mike Rothenberg, a former VC known for hosting lavish parties, was convicted today on 21 counts for defrauding investors
Featured Article: Timing Is The Single Biggest Reason Why Startups Succeed
Softbank backed - IRL, valued at $1 Billion+ founders allege investors sabotaged company with fake users claims
Founders of IRL, a social calendar app, are suing investors, alleging they fabricated claims of 95% fake users to intentionally shut down the company.
The investors, including SoftBank and Goodwater Capital, deny the allegations, citing suspicious user behavior during an investigation. IRL, once valued at $1.17 billion, faced a significant drop in users, and the SEC is investigating potential securities law violations. The case mirrors a trend of startups, like Bolt and Frank, facing SEC probes for misleading metrics. Plaintiffs claim investors needed a scapegoat to protect their reputations.
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💰 Massive Fundings Updates
Codegen’s, a cloud and on-premises tool that connects to codebases and project management boards, such as Jira and Linear, and automatically generates pull requests to address support tickets. It closed a $16 million seed round led by Thrive Capital with participation from angel investors including Quora CEO Adam D’Angelo and Instagram co-founder Mike Krieger. More Here
Siena AI, aims to develop an empathic AI customer service agent recently raised $4.7 Million in seed funding from a group of investors including Sierra Ventures, Pari Passu Ventures, Spacestation Investments, Village Global, The Council and OpenSky Ventures. More Here
Ida, a French startup that wants to work with supermarkets and grocery stores to optimize new orders of fresh products, such as fruits, vegetables, meat, poultry and fish. The startup recently raised a $2.9 million (€2.7 million) seed round from Frst, Daphni, Motier Ventures and Kima Ventures. More Here
Blackshark.ai, aims to build a digital twin of the Earth, and its next play further democratizes the hitherto lofty (if you will) world of geospatial intelligence. The company also announced $15 million in new funding from existing investors Point72 Ventures, M12 Microsoft’s Venture Fund, and Maxar are joined by In-Q-Tel (IQT), Safran, ISAI Cap Venture, Capgemini’s VC Fund managed by ISAI, Einstein Industries Ventures, Interwoven Ventures (formerly ROBO Global Ventures). More Here
CreateSafe's Triniti, offers artists an AI platform for voice cloning, text-to-audio, chatbot assistance, and music business tools in a free web beta. CreateSafe revealed that it raised $4.6 million in funding. The seed round was led by Polychain Capital with participation from Kendrick Lamar’s manager Anthony Saleh, Paris Hilton-founded 11:11 Media, Unified Music Group, Crush Ventures, MoonPay, Chaac Ventures and Dan Weisman, the vice president of Bernstein Private Wealth Management. More Here
Qevlar AI, a Paris startup that is designing software to automate the analysis of potential security incidents, raised a $4.9 million seed round. EQT Ventures was the deal lead. More Here
Cytovale, a ten-year-old San Francisco company that has designed a test to catch early cases of sepsis, raised an $84 million Series C round led by Norwest Venture Partners, with additional participation from Sands Capital and Global Health Investment Corporation. More Here
Element Energy, a four-year-old startup based in Menlo Park, Ca., that has developed technology to monitor the performance of first- and second-life batteries used in commercial and industrial settings, raised a $73 million Series B. Investors included Cohort Ventures, Mitsubishi Heavy Industries, Drive Catalyst, and FM Capital. It also lined up a $38 million debt facility provided by previous investor Keyframe Capital Partners. More Here
Cumulus Coffee, a startup that is selling a $599 countertop cold coffee brewing machine that the company claims can produce a still cold coffee, nitro cold coffee, or an espresso-like cold coffee within seconds, raised a $20.3 million seed round co-led by Valor Siren Ventures and Valor Equity Partners, with additional funds provided by Maveron, Linden Ventures, and former Starbucks CEO Howard Schultz. More Here
Taproot Wizards, a Bitcoin-focused Ordinals project that was inspired by the original Bitcoin wizard Reddit meme from a decade ago, is trying to change the way the blockchain is perceived. The project has raised $7.5 million in a round led by Standard Crypto. Other investors include Geometry, Collider Ventures, StarkWare, UTXO Management, Bitcoin Frontier Fund, Masterkey and Newman Capital. More Here
Tradespace, a four-year-old San Francisco startup that uses AI to help organizations manage their intellectual property portfolios, raised a $4.2 million seed round led by Eniac Ventures, with Abstract Ventures, Amplo VC, and Scrum Ventures also anteing up. More Here
OCOchem, a Richland, Wash.-based startup, raised $5 million to scale its technology for turning carbon dioxide into chemicals that can be used to manufacture clean hydrogen, fertilizer, animal feed and other products. TO VC, an early-stage decarbonization-focused venture fund, led OCOchem’s seed round and was joined by Japan’s INPEX Corp; the LCY Lee Family Office; and Taiwan-based MIH Capital Management. More Here
🚀 Venture Capital Highlights
Mike Rothenberg, a former startup luminary, has been found guilty on 21 counts, including bank fraud, money laundering, and wire fraud. Known for his initial success with a $5 million fund in 2013, Rothenberg faced scrutiny for organizing lavish parties and SEC charges in 2018 for overcharging investors. The recent DOJ conviction adds to his legal woes, with potential maximum penalties of up to 30 years in prison and substantial fines. Rothenberg's downfall marks a stark contrast to his early image as a charismatic and ambitious supporter of startups. More Here
Ballistic Ventures, a venture capital firm dedicated to funding and incubating cybersecurity startups, is looking to raise as much as $300 million for a new fund. The San Francisco-based VC firm Wednesday filed with the U.S. Securities and Exchange Commission to raise $300 million for its second fund — over a year after launching its first fund of the same amount in May 2022. More Here
Menlo Ventures closes on $1.35B in new capital, targets investments in AI startups: Menlo Ventures has raised $1.35 billion in new capital, intending to support upcoming AI startups. The firm, bullish on AI's future, emphasizes the significance of AI in innovation. With a focus on its flagship venture fund, Menlo XVI, the firm aims to invest in seed to Series A stages and beyond, while continuing to diversify across sectors like healthcare, consumer, and fintech. More Here
📬 Featured: Today’s Featured Article
Timing Is The Single Biggest Reason Why Startups Succeed
What makes the startup successful - is it idea, team, funding, business model, talent or luck? What do you think?
But wait one thing is missing here & that’s “Timing”! You might be thinking if I have a great idea with talented team and strong unit economics business model no one can stop me! If you know 90% of startups failed and one reason is just bad timing. Founder just failed to determine the timing phase of their startup. So How can you determine? Read More Here 👇
💡 Startups Snap: The Latest Buzz
Startup Acquisition
Data-syncing startup Hightouch has acquired HeadsUp, with HeadsUp co-founder Earl Lee joining Hightouch to work on Customer 360. Hightouch, recently valued at $615 million, expands beyond data-syncing into AI-powered customer data management. The acquisition aims to enhance Hightouch's capabilities in assessing customer value based on programmatic signals, aligning with HeadsUp's mission in data utilization for value assessment. More Here
InDrive, the “bid-based” ride-hail platform popular in Latin America and Asia, has launched a new venture and merger and acquisition division named New Ventures to invest up to $100 million in startups within emerging markets. As InDrive works toward profitability, the company sees this as a chance to diversify revenue streams. More Here
Aave Companies, a prominent crypto entity, is rebranding to Avara, signaling a shift beyond DeFi. Avara has acquired Los Feliz Engineering, the team behind the Ethereum-based crypto wallet Family, to facilitate user entry into the web3 ecosystem. The company aims to expand its focus globally, emphasizing decentralized social media through entities like Lens Protocol. More Here
Startup Exits
Thrasio Holdings, an aggregator of third-party sellers on Amazon, is reportedly preparing to file for bankruptcy due to a post-pandemic decline in online spending. Advised by consulting firm AlixPartners, the company, which raised $1 billion in 2021, has enlisted the help of retail turnaround professional Holly Etlin and is exploring restructuring options with law firm Kirkland & Ellis. More Here
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🤖 The Latest In Emerging Tech: AI
French startup Mistral AI is at the center of the debate over the European Union's AI Act, with disagreements arising on how to regulate foundational models. Mistral opposes the tiered approach proposed by the EU Parliament, advocating for hard rules on product safety instead, placing responsibility on deployers rather than foundational model makers. The company argues that this approach fosters healthy competition and allows for benchmarking specific use-cases, ensuring the safety and trustworthiness of AI applications. More Here
Meta brings us a step closer to AI-generated movies: Meta has unveiled Emu Video, an AI-powered tool capable of generating realistic 512x512, 16-frames-per-second animated clips from captions or images. While impressive, the technology currently struggles with dynamic scenes and lacks a strong grasp of action verbs, raising ethical concerns about potential job displacement for animators and artists. Emu Video is set to be integrated into Facebook and Instagram, prompting debates about its impact on the creative industry. More Here
🗞️ Today’s Must Read On: Startup, Technology & VC
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✍️Written By Sahil R | Venture Crew Team
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