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- VC Daily Digest - 20/10/2023
VC Daily Digest - 20/10/2023
Sequoia faces scrutiny over China Investment & Product Hunt Struggling Layoffs 60% Staff
Venture Daily Digest
October 20, 2023
📮Today’s Major News
Sequoia faces congressional scrutiny over investments in China
Venture capital management fees dip to lowest level
Product Hunt cleans house with layoffs impacting 60% of staff
Featured Article: Why Do VC Firms Want an Option Pool Before the VC Round?
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💰 Massive Fundings Updates
iink, a digital payments network out to make it easier to get funds associated with multiparty property insurance claims. That work is buoyed by some fresh capital in the way of $12 million in Series A financing led by Headline. The firm was joined by Motley Fool Ventures, Chartline Capital Partners, Silver Circle Ventures and a group of existing investors.
Vopero, which provides a clothing resale marketplace for Latin America raised $4 million in funding. Cencosud Ventures led the round and was joined by existing investor Grupo Axo. To date, Vopero has raised $10 million in venture-backed funding.
Sidebar, a company developing a group coaching program focused on driving individual career growth, it raised $13.55 million in a seed round from investors including Foundation Capital, Scribble Ventures and Pinterest co-founder Evan Sharp.
Tofu, automates content creation for massive omnichannel B2B marketing campaigns raised $5 million in seed funding led by Index Ventures, with participation from SignalFire, Stage 2 Capital and Liquid 2 Ventures.
Creative Force, A Denmark based company providing an AI-powered content operations workflow for large e-commerce retailers and brands, secured $8.9 million in Series A funding, on a post-money valuation of $56 million, from Export and Investment Fund of Denmark and Hearst Ventures.
New York-based Leucine raised a $7 million Series A led by strategic investor Ecolab Inc. Participants include returning investors like Pravega Ventures, Axilor Ventures, Techstars and angel investors. Leucine wants to make the compliance process more efficient with its compliance cloud platform for the pharmaceutical industry. It automatically creates digital manufacturing records and uses AI to identify the root cause of deviations.
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🚀 Venture Capital Highlights
Sequoia faces congressional scrutiny over investments in China: One of Silicon Valley’s most prominent investment firms will face government scrutiny over its investments in China. Sequoia Capital has received a polite but pointed request from Congress to enter into more detail on how it will prevent further U.S. investment dollars from advancing Chinese interests. More Here
Venture capital management fees dip to lowest level since 2017 – Preqin: Venture capital management fees slipped to 1.97% in 2023 from 2.02% in 2022, marking their lowest such level since 2017, according to the annual Private Capital Fund Terms Advisor report released by Preqin on Oct. 18. In 2022, one-fifth of VC funds charged a management fee above 2.5% — in 2023 that percentage declined to 16.29%. Current market conditions in recent quarters have likely led fund managers to cut fees to attract limited capital. More Here
Harvard Gains 2.9% as Venture Capital Drags Returns at Endowments: Harvard University’s $50.7 billion endowment gained 2.9% in the last fiscal year as investments in private equity and venture capital dragged on its performance and those of some of its biggest rivals. For the fiscal year ended June 30, Harvard’s endowment—the largest among U.S. universities—had only 11% of its assets in public equities, with 39% in private equity, and 31% in hedge funds. More Here
Q3 data for women funded startups is just more of the same: All-women founding teams have raised 1.9% of all venture capital dollars so far this year, or $2.4 billion out of the total $125.85 billion allocated through Q3. That percentage is only slightly less than what was raised through Q3 last year, when all-women founding teams raised $4.1 billion out of $204.8 billion, totaling around 2% of capital. More Here
Early-stage founders are optimistic about raising again — but not all of them: Raising capital is never easy, and the past few years have been particularly tough for startups. But there are signs that the tide may be starting to turn. A new Ventures survey of 437 pre-seed and seed-stage founders found that 57% of early-stage founders are more optimistic about their ability to raise capital now compared to nine months ago. In 2022, 43% of founders were optimistic and 54% were optimistic amid 2021’s froth. More Here
Third Point managing director doubles down on SBF investor fraud in trial testimony: During Sam Bankman-Fried's trial, witnesses including Robert Boroujerdi, managing director at Third Point, testified that they were unaware of the financial ties between FTX and its sister company Alameda when investing $60 million in FTX. Boroujerdi stated Third Point would not have invested if they knew the funds were transferred to Alameda. Similarly, Matt Huang of Paradigm testified they would not have invested $278 million in FTX had they known about the red flags. More Here
📬 Featured: Today’s Featured Article
Why Do VC Firms Want an Option Pool Before the VC Round?
Many founders, I observed get confused when VCs say they will invest some amount at pre-money.
“When a VC says they will invest $10 million pre-money” - it means $10 million inclusive of any ESOP the startup will be set aside for future employees. At the same moment, they always have a query about why it’s not exclusive and why investors saying it’s inclusive. Read More Here👇
💡 Startups Snap: The Latest Buzz
Product Hunt cleans house with layoffs impacting 60% of staff: Product Hunt, the product discovery site for smaller startups, apps, tech tools and developers’ side projects, is cleaning house. The company earlier this month announced layoffs, but didn’t give an indication of how widespread those cuts were. We now understand the cuts impacted around 60% of the team, including design, product, sales and other roles. Product Hunt’s about page indicates engineering, ads and community staff remain. More Here
With X, Musk is playing the bottom-up game: Most marketers can’t dream so big as to imagine a world where the name of their product is mentioned on every newscast, written about on every flier, every advert, every sign and every email signature. That’s the absurdly omnipresent power of the Twitter brand. At first, it seemed like Musk was playing a game of chicken with the site. But no. The gloves are off. More Here
Poshmark to shut shop in India, Australia and UK in abrupt retreat from international markets: Poshmark is shutting down its international businesses — operations in India, Australia and the U.K. — as the social shopping marketplace shifts attention to “core markets,” the company informed customers. Poshmark has about 8.1 million monthly active users on its phone apps, according to mobile intelligence firm Sensor Tower, whose data an industry executive shared with TechCrunch. More Here
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🤖 The Latest In Emerging Tech: AI
Google takes aim at Duolingo with new English tutoring tool: Google’s gunning for Duolingo with a new Google Search feature designed to help people practice — and improve — their English speaking skills. Rolling out over the next few days for Search on Android devices in Argentina, Colombia, India, Indonesia, Mexico and Venezuela, with more countries and languages to come in the future, the new feature will provide interactive speaking practice. 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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