VC Daily Digest - 25/08/2023

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📢 Top Venture Capital News

5 trends in VC funding for pre-seed startups: Silicon Valley's fundraising landscape has seen a significant shift. As the economy evolves, venture capitalists are increasingly cautious, investing in later-stage startups with less risk. This shift may pave the way for a more sustainable, value-driven ecosystem, favoring startups that can navigate this new terrain of skepticism and scrutiny. Despite the challenges, founders remain resilient, with 16% more pitch decks sent out this year, indicating their determination to secure funding. More Here

Hustle Fund doubles down on its mission to build the ‘YC of angel investing’: Hustle Fund's Angel Squad, an investment community for new angel investors, is redefining the concept of angel investing. With members from diverse backgrounds and professions, Angel Squad is making investing more accessible with minimum check sizes as low as $1,000. The Squad has grown to over 1,500 members, 75% of whom are based outside the San Francisco Bay Area, and has invested $23 million into 65 deals. The mission is to empower more angel investors, diversify the investor base, and open up access for more people to invest in startups. More Here

Vessel Capital emerges from stealth with $55M fund focused on web3 infrastructure and apps: Vessel Capital, a web3 venture fund, has emerged with $55M in assets under management, ready to invest in infrastructure and applications. Founded by Mirza Uddin, Eric Chen, and Anthony Anzalone, the firm aims to meet new founders and help them scale their companies. Unlike many venture funds, Vessel Capital is committed to providing actual guidance and advice, not just capital. With a focus on application-specific infrastructure, the firm is also open to exploring other categories. More Here

Healthcare venture fund, Questa Capital raises $397M: Questa Capital, a healthcare venture capital fund, has successfully raised $397 million for its third fund. This will be invested in 10-14 growth-stage healthcare companies over the next 3-4 years. Since its inception seven years ago, Questa has raised over $1 billion and has made significant investments in companies like DispatchHealth, Cortica, and Vynca. As the healthcare industry continues to evolve with technological advances, Questa is committed to supporting this change with focused investments. More Here

The VC Who Made Suckers out of His Investors and Is Now Back to Taunt Them: In any just world, Chamath Palihapitiya would be ashamed of himself. The well-known venture capitalist and podcaster lent his reputation to a slew of companies going public via his special-purpose acquisition companies. He was the ruinous “SPAC King.” Now, almost a year after calling it quits on two SPACs, he’s still in denial that he was the Pied Piper who enticed retail investors into betting on speculative, money-losing companies. He’s like a bully who stole someone’s lunch money and then says, “Stop crying about it”—except it’s for all the world to see. More Here

Crypto VC inflows drop further as macro factors weigh on investments: July saw a 10.26% decrease in venture capital inflows, with $700 million raised, according to Cointelegraph Research VC Database. Despite this, the crypto VC sector saw notable outliers with Polychain Capital and CoinFund launching investment funds worth $200 million and $152 million respectively. The potential approval of Bitcoin ETFs in the U.S. could revitalize the industry, while Web3 and infrastructure sectors continue to see active deals. However, the overall upward trend in investments hasn't continued, with investor activity lower and the blockchain industry unlikely to see a quick return to a steady upward trend. More Here

Qumra Capital raises $275m for fourth fund: Despite a challenging climate for venture capital, Israeli growth fund Qumra Capital has raised $275 million for its fourth fund, making it the largest Israeli fund raised this year. Although falling short of its $300 million target, Qumra aims to secure the remainder by year-end. Amid rising interest rates and a global decline in returns, the firm's resilience underscores its commitment to investing in high-tech companies. Qumra's previous investments have included successful IPOs such as Fiverr, JFrog, and Taboola. More Here

📢 Top Startups News

Saudi Arabia Investment Is Increasing In US-Based Startups: Saudi Arabia-based investors are showing an increasing appetite for U.S. startups, with a steady rise in funding deals since 2019. Despite a slowdown in the venture market, the number of funding deals involving Saudi firms rose by nearly 40% in 2022. The trend continues with firms like Nile and Axiom Space securing significant funding rounds led by Saudi investors. This suggests that the Middle Eastern nation's investment in the U.S. startup scene shows no signs of slowing down. More Here

HSBC expands venture debt offering to early-stage startups in US: HSBC said on Thursday it has expanded venture debt offering to early-stage startups through its U.S. innovation banking division. London-based HSBC has been catering to late-stage and mature firms since 2019. Debt has become an increasingly popular option for startups looking for cash in a tough financing market. Last year, several late-stage startups suffered from a drop in valuations and a risk-off sentiment amid higher borrowing costs. More Here

7 founders and CEOs discuss fusion power’s most pressing challenges: The fusion power industry is undergoing a significant shift. Once dominated by university and government researchers, the sector is now seeing an influx of founders and CEOs, bringing fusion power from the lab to the market. With over $6 billion in investments, the fusion power sector is experiencing rapid growth, driven by advancements in high-temperature superconducting magnets and computing power. However, the industry still faces challenges, including a history of overpromises and underdeliveries, and the need for long-term investment horizons. More Here

Chainsmokers Invest in—and Party With—Niche Cybersecurity Companies: DJ duo The Chainsmokers, also known as Alex Pall and Drew Taggart, are not only music producers but also tech investors. Their venture firm, Mantis VC, has a diverse portfolio of fintech, machine learning, ecommerce, gaming, and healthcare startups. Recently, they've been gaining a reputation for identifying startups addressing complex digital security issues. Their latest investment is in iVerify, a mobile security app aiming to combat the spyware industry. More Here

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📢 Top AI News

How and when to charge for adding AI to your enterprise software: Nvidia's recent earnings report underscores the accelerating race to build generative AI products. With tech companies and cloud providers investing heavily in hardware to train AI models, Nvidia is reaping the benefits. However, the question remains: how and when should tech companies charge more for AI-powered software tools? Microsoft has made strides in monetizing AI, while others are exploring ways to enhance value without raising prices. The conversation around AI pricing is evolving, with companies like Amplitude and Appian providing valuable insights. More Here

Nvidia is flying high thanks to AI! But can it keep it up?: Nvidia's recent earnings announcement showcased a staggering 101% YoY growth, with the company raking in $13.5 billion for the quarter. This growth is largely driven by high demand for their GPU chips, used in large language models and AI workloads. However, as Zoom's recent slowdown in growth shows, sustaining such high growth rates can be challenging. Yet, with the continued expansion of data centers and the growing importance of AI, Nvidia's CEO, Jensen Huang, believes their growth is more than a temporary surge. More Here

Nvidia Chip Shortages Leave AI Startups Scrambling for Computing Power: As the global rush to integrate AI into every app and program intensifies, a GPU supply crunch is impacting companies like Tel Aviv-based startup Astria. The shortage is forcing Astria to use more powerful and expensive GPUs, driving up costs. Despite the challenges, Astria continues to balance out these peaks for its customers. With no immediate end in sight for the GPU supply crunch, companies are innovating to maintain access to the resources they need, and adeptness at navigating this crunch could become a determinant of survival in the generative AI economy. More Here

Modular secures $100M to build tools to optimize and create AI models: AI startup Modular has secured $100 million in funding, bringing their total to $130 million. The funds will be used for product expansion, hardware support, and further development of Modular's programming language, Mojo. Modular's mission is to simplify the process of building and maintaining large-scale AI systems, with a focus on improving inferencing performance and cost savings. The company is tackling the complexity that slows AI development by addressing fragmentation issues in the AI stack. More Here

How AI Startups can beat tech giant: It is summer 2023, and each day brings a new AI product demo that goes completely viral on Twitter X or TikTok. Countless people are blown away by the product’s magic-like qualities, powered by GPT-4, Stable Diffusion, or some other new language, video, or image model. And while it’s an incredibly exciting time to be building or investing in AI, it’s also a fiercely competitive one as well, especially for teams building in the application layer—the part of the technology stack that delivers real world products to end users interacting directly with software. More Here

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📢 Top Startup’s Fundraising News

AI Startup Hugging Face Valued at $4.5 Billion After Raising Funding From Google, Nvidia raised $235M: Hugging Face Inc., a startup that makes artificial intelligence software and hosts it for other companies, said it has been valued at $4.5 billion after raising $235 million in funding. Alphabet Inc.’s Google, Amazon.com Inc., Nvidia Corp., Intel Corp., Salesforce Inc. and others participated in the funding round, the company said Thursday. Hugging Face now has raised a total of $395 million. More Here

Advanced Ionics nets $12.5M Series A to inject green hydrogen into heavy industry: In the conversation about hydrogen, transportation often takes center stage. However, Chad Mason, founder and CEO of Advanced Ionics, argues that hydrogen's real potential lies in heavy industry, which accounts for about a third of global emissions. More Here

Maria Shriver’s, Patrick Schwarzenegger’s MOSH noshes on $3M for retail expansion: MOSH, a brain health brand co-founded by Maria Shriver and Patrick Schwarzenegger, has secured its first institutional capital of $3 million in Series A financing to boost its retail distribution strategy. The nutrition company, which was launched in 2021, produces protein bars in collaboration with brain health doctors and has already amassed over 100,000 customers, selling approximately $10 million worth of protein bars. With the new capital, MOSH plans to expand into retail, targeting more than 1,800 stores by next year, and launch new product lines. The company's success story is a testament to the growing global brain health supplements market, projected to reach $16 billion by 2030. More Here

Rocketium scales and analyzes massive marketing campaigns secured $5.3M: Rocketium, a platform that automates content creation for large-scale marketing campaigns, has secured $5.3 million in funding led by Tenacity Ventures. The Palo Alto-based company, whose clients include McDonald's, Amazon, and Tokopedia, has shifted its focus to large enterprises, offering project management and analytics tools alongside its design scaling product. Rocketium's analytics can break down designs by individual elements and provide detailed feedback to optimize clickthrough rates. The company is also investing in generative AI to create content drafts, evaluate and rewrite briefs, and ensure diversity and inclusivity in content. More Here

Weekday puts the spotlight on job references raised $2.2M: Weekday, a hiring platform focused on referrals and references, has emerged from stealth with $2.2M in seed funding. Founded by Amit Singh, Anubav Malik, and Chetan Dalal, Weekday aims to revolutionize recruitment by making job references central to the hiring process. Their unique approach includes a "Backchannel" feature for obtaining background references, and a shortlisting process that matches recruiter requirements with a pool of passive candidates. With over 120 companies already using the platform, Weekday is set to redefine the hiring landscape. More Here

Backed by Peak XV and Jungle, Neurowyzr puts the focus on brain health raised $2.1M: Neurowyzr, a startup focused on early detection of brain decline, has raised $2.1 million in seed funding. With offices in Singapore and India, the company offers a digital neuroscience assessment tool, the Digital Brain Function Screen (DBFS), designed to be a faster, less costly alternative to traditional cognitive testing. The tool, which is currently used by several healthcare organizations in Singapore, assesses immediate memory, working memory, attention, and executive brain function through a series of gamified neuroscience puzzles. This funding will be used for product development and regional expansion in Southeast Asia and India. More Here

Former head of growth at Slack is building a growth-tracking platform for everyone raised $5M: Panobi, a growth-tracking platform, has raised $5 million in seed funding and is launching a closed beta of its product. Co-founded by Merci Grace, former head of growth at Slack, Panobi aims to streamline growth metrics tracking, a task often still performed in spreadsheets or project management tools. The platform connects to data warehouses like Snowflake, providing real-time user metrics and a timeline of performance. With a focus on cross-functional collaboration, Panobi also enables data sharing across departments via Slack and eventually Microsoft Teams. More Here

a16z-backed AI video generator Irreverent Labs raises funding from Samsung Next: The AI-driven content creation landscape is expanding, with Bellevue-based startup Irreverent Labs leading the charge. Having recently secured funding from Samsung Next, the company, initially recognized for its blockchain-based game, is now focusing on enabling users to create videos using AI. Co-founded by Rahul Sood and David Raskino, Irreverent Labs aims to democratize video creation, targeting content creators, developers, and enterprises. As Joan Kim from Samsung Next puts it, the potential impact of this technology is "immense." More Here

Cypago, which aims to automate compliance and governance for companies, raises $13M: In 2022, over 40 U.S. states introduced 250 cybersecurity bills, prompting 63% of companies to increase spending on compliance and risk. To help businesses navigate these evolving standards, startups like Cypago are automating cybersecurity processes around governance, risk, and compliance. Cypago, founded by former EY executive Arik Solomon and ex-IDF officer Yahav Peri, has raised $15 million to further develop its AI-powered platform. The solution offers easy implementation, fast adoption, and API-based integrations, aiming to provide full cybersecurity visibility and enforcement. More Here

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✍️Written By The Venture Crew Team

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