VC Daily Digest - 21/11/2023

📮Today’s Major News

• Sam Altman Joined Microsoft as Tech CEO → Again, Sam Altman's potential return to OpenAI, Even after Joining Microsoft

• Riverwood Capital has closed on $1.8 billion in new capital

• US emerging VC Funds Raised $11 Billion in 2023

• Instagram Threads missed a moment to shine, as OpenAI’s drama took place on X

• Featured Article: 5 Hacks To Stand Out From The Crowd To Break Into VC

Open AI Saga Explained: 3 CEOs In 3 Days

Again - Microsoft CEO Satya Nadella hints at Sam Altman's potential return to OpenAI, Even after Joining Microsoft! 

• Thursday night, Sam Altman gets a text from Ilya Sutskever, OpenAI’s chief scientist & board member asking to chat on Friday.

• Friday at Noon, Sam Altman is fired by the Open AI board because he was “not consistently candid in his communications.”

• CTO Mira Murati is made Interim CEO.

• Microsoft, OpenAI’s largest investor, found out about the move 1 minute before the announcement. Their stock gets crushed.

• Right after, Greg Brockman, OpenAI’s President is asked to chat, where he’s told he’s removed from the board but retaining his role.

• Greg resigns from OpenAI in solidarity with Sam Altman shortly after.

• Tech news & twitter subsequently blow the f*ck up.

• Sam Altman fires off a few tweets saying how grateful he was for openAI and the people and how he’d have more things to say soon.

• OpenAI employees start tweeting hearts supposedly a signal to the board of who would leave OpenAI to follow Sam Altman if the decision was kept.

• By Saturday, rumors start that the OpenAI board is in discussions to bring Sam Altman back as CEO.

• Sam Altman tweets out a picture of him wearing a guest pass at OpenAI HQ.

• Microsoft & Satya Nadella lead the charge to negotiate with the board.

• Board negotiation ends with Altman officially being out on Sunday night & employees streaming out of the office.

• Monday morning Twitch cofounder Emmett Shear is named interim CEO.

• Around the same time, Satya Nadella announces that Sam is joining Microsoft as the CEO of a new AI research group & former OpenAI leaders like Greg Brockman are joining him.

• Monday Morning, OpenAI employees share a letter with the board where 650 of 700 employees tell the board to resign.

• Again - Microsoft CEO Satya Nadella hints at Sam Altman's potential return to OpenAI, emphasizing governance changes, as internal unrest continues over CEO Emmett Shear's appointment.

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💰 Massive Fundings Updates

AppFlowy, an open source notion alternatives working in workspae productivity , has raised $6.4 million in funding from a slew of renowned founders, including Matt Mullenweg (Automattic); Steve Chen (YouTube); Tom Preston-Werner (GitHub); Bob Young (Red Hat) and Amr Awadallah (Cloudera). The seed round was led by OSS Capital. More Here

Avarni, A Sydney-based startup helps companies measure carbon emissions, identify hotspots in their supply chains and strategize how to hit net-zero targets. It has raised $2.5 million AUD (about $1.64 million USD) in an extension round from returning investor Main Sequence and new backers Sprint Ventures and AfterWork Ventures. This brings Avarni’s total raised so far to $6.1 million. More Here

LucidLink, a startup offering a platform that enables teams to work on files without having to download or sync them, it raised $75 million in a Series C round led by Brighton Park Capital with participation from Headline, Adobe Ventures and Baseline Ventures. The tranche brings LucidLink’s total raised to $90 million. 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

US emerging VC Funds Raised $11 Billion in 2023: Despite a challenging fundraising environment in 2023, U.S. emerging venture capital managers raised $11 billion across 170 funds, outperforming expectations. Established VCs raised $31 billion across 174 funds, indicating a more resilient performance by emerging managers, who secured 26% of total capital raised, up from 23% in 2022. The success is attributed to their focus on niche markets, fresh perspectives, and innovative strategies, while the market cleansing of less experienced fund managers is seen as positive for the venture ecosystem heading into 2024. More Here

Riverwood Capital closes $1.8B fund: Riverwood Capital has closed on $1.8 billion in new capital. The firm last raised in 2020, with total capital commitments of $1.4 billion at that time. Riverwood’s strategy is to invest in and support “high-growth” mid-size technology companies that are either profitable or with positive unit economics. More Here

SEVA, a new growth equity fund, secures $85M for debut fund: Shalin Mehta, formerly with Susquehanna Growth Equity, has launched SEVA, a growth equity firm securing $85 million for its debut fund. Mehta aims to invest in customer-centric founders of fast-growing, bootstrapped companies, focusing on profitable growth. The LPs Includes institutional investors, university endowments, and family offices. Mehta plans to invest in 8-10 companies over the next 3-5 years, emphasizing internet, software, data, marketplace, and tech-enabled services. More Here

VCs More Bullish On Defense Tech: Venture investment in defense technology is experiencing a generational shift, with $34.3 billion injected into aerospace and defense companies in the last year alone. Generalist VCs entering the space are driving up valuations, posing challenges for startups to meet growth expectations. Key areas of focus include AI, cyber, space, and autonomy, with a push to bridge the "valley of death" in government contracts. The landscape is evolving rapidly amid rising geopolitical tensions, marking a critical juncture for reshaping the defense tech ecosystem. More Here

📬 Featured: Today’s Featured Article

5 Hacks To Stand Out From The Crowd To Break Into VC

Getting a job in Venture Capital (“VC”) is hard. The industry is small and very unstructured. Jobs are rarely advertised online and no one really knows where to start.

With more and more people looking to break in every day, you can’t be like everybody else if you want a seat at the table. There are 5 main hacks to stand out from the crowd and break into VC — all of which you can start doing today Read More Here 👇

💡 Startups Snap: The Latest Buzz

Startup Exits

Cruise co-founder resigns following CEO exit: General Motors' self-driving unit, Cruise, faces more upheaval as co-founder and Chief Product Officer Daniel Kan resigns following CEO Kyle Vogt's departure. The company is undergoing a safety review of its U.S. fleet after a recent accident, leading to increased leadership scrutiny. Cruise's challenges pose setbacks for the self-driving industry, relying on public trust and regulatory cooperation. More Here

People

Emmett Shear has been appointed interim CEO of OpenAI amid a leadership shakeup, following Sam Altman's firing and subsequent speculation. Shear plans to hire an independent investigator, address internal and external concerns, and ensure customer and partner retention. His past controversial statements on social media, including discussions on Nazis and AI development, raise questions about the company's direction. More Here

Microsoft has hired OpenAI co-founders Sam Altman and Greg Brockman to lead a new advanced AI research team after OpenAI's board dismissed Altman. Altman will serve as the chief executive of the new AI group at Microsoft. The move follows a weekend of turmoil at OpenAI, with Altman's removal, the appointment of Emmett Shear as interim CEO, and protests from OpenAI employees. More Here

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🤖 The Latest In Emerging Tech: AI

Investors are souring on OpenAI’s nonprofit governance model: OpenAI's unique governance structure, aiming to balance profit with ambitious, humanistic goals, led to the sudden ousting of CEO Sam Altman. Investors, including Microsoft's Satya Nadella, express dissatisfaction, contemplating legal action. The incident raises concerns about the effectiveness of nonprofit-governance models in AI companies, potentially impacting investors' confidence in strong boards. More Here

Instagram Threads missed a moment to shine, as OpenAI’s drama took place on X: Over the weekend, the OpenAI CEO shakeup dominated tech discourse, with discussions unfolding primarily on Twitter/X rather than Instagram Threads. Key players, including Sam Altman and Greg Brockman, utilized X for statements and reactions, while news broke on the platform. Despite Threads' aim to be a non-news alternative, X remained the go-to platform for real-time updates and reactions in the tech community, showcasing its resilience despite recent challenges. More Here

🗞️ Today’s Must Read On: Startup, Technology & VC

• Microsoft Build In House ChatGPT Read More (Technology)

• Sudden Disturbances in Rapidly Moving Objects : The Implications of the OpenAI Fiasco Read More (startups & Tech)

• How Does Adding Investors Change Your Startup’s Exit? Read More (Startups)

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✍️Written By Sahil R | Venture Crew Team

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