VC Daily Digest - 26/09/2023

Amazon To Invest $4 Billion In Open AI Rival & Reddit Begins Paying Users

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Venture Daily Digest
September 26, 2023

📢 Major News

  • Amazon to invest up to $4 billion in OpenAI Rival Anthropic

  • Bitcoin Has Become Boring. Here’s What Could Wake It Up

  • Q2 2022 Venture Capital Funding Data Shows a Steep Drop

  • Featured Article: What's Better Than Product Market Fit (PMF)? It's Product Market Distribution Fit (PMDF)

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📢 Venture Capital Highlights

VC firm Fuse closes $250M fund to invest in Pacific Northwest startups: Fuse, a Bellevue, Washington-based early-stage venture outfit focused on PNW companies, today launched a $250 million investment fund focused on software and “AI-enabled” startups. The fund — Fuse’s second — is backed by state-affiliated accounts, foundations, universities and what Fuse describes as “many of the most high-profile Seattle-based software executives.” More Here

A top European software investor raises $700 million:
Dawn Capital, one of Europe's biggest backers of business software companies, raised $700 million in two new funds, defying the odds as venture capital investment in tech startups has slumped. The London-based VC firm is one of the most prominent tech investors in Europe, with a portfolio that includes the likes of PayPal-owned payment firm iZettle and Visa-owned open banking startup Tink. More Here

Secha Capital Raises $300 Million From Blue-Chip Investors:
Secha Capital today announced a first close of its second fund, with R300 million in investments from blue-chip investors. RMB Ventures, 27four Investment Managers, The SA SME Fund and Caleo Capital. Founders of Sechaba Capital are Nombuso Nkambule, Brendan Mullen and Rushil Vallabh who started Secha Capital in 2017. More Here

Q2 2022 Venture Capital Funding Data Shows a Steep Drop, But Still Exceeds Pre-Pandemic Levels: CB Insights has released the preview of their State of Venture Q2’22 Report, finding a 23% drop in venture capital funding to startups on a global level in the second quarter of this year, with $108.5B raised across 7,651 deals. They note this was the second largest quarterly percentage drop as well as the largest quarterly percentage drop in deals in the past ten years. However, despite this significant drop, second quarter funding still came in as the 6th highest on record. More Here

📢 Massive Fundings Updates

Amazon to invest up to $4 billion in AI startup Anthropic:
Amazon has agreed to invest up to $4 billion in the AI startup Anthropic, the two firms said, as the e-commerce group steps up its rivalry against Microsoft, Meta, Google and Nvidia in the fast-growing sector that many technologists believe could be the next great frontier. The e-commerce group said it will initially invest $1.25 billion for a minority stake in Anthropic. More Here

Nx lands $16M to build ‘monorepo’ tools for software devs:
Nx, a startup developing tooling to make it simpler for software dev teams to work within a single code repository, today closed a $16 million Series A round with participation from Nexus Venture Partners and a16z. The funding will be used to expand Nx’s fully managed product, Nx Cloud, to make it more of a replacement for existing continuous integration tools. More Here

TeachMe.To lands $2M to connect beginner athletes:
TeachMe.To, a sports coaching platform for beginner athletes, secured $2 million in seed funding, the company exclusively told TechCrunch. The funding will be used to scale the platform, launch a new app for students and expand beyond its sports offerings. More Here

Note-taking app Goodnotes invests $1.9M in digital stationery company WeBudding: A digital stationery store within the app, note-taking company Goodnotes said today it has invested $1.9 million into South Korea-based digital stationery company WeBudding. WeBudding was founded by Donghwan Shin, Donggyun Ko and Chaeyoung Lee in 2018. The trio started by selling physical paper notebooks catered toward university students, but eventually, they made a digital pivot. More Here

AI startup Gizmo raises $3.5M by using gamified quizzes and flashcards to make learning fun:
Gizmo, a generative AI learning startup that uses gamified quizzes to engage learners, today announced $3.5 million in seed funding from NFX, Ada Ventures, and Capital T. The company will use the funding to scale its platform globally, hire more engineers and roll out new features. More Here

📬 Featured: Today’s Featured Article

What's Better Than Product Market Fit (PMF)? It's Product Market Distribution Fit (PMDF)

As a founder/investor, you always hear everyone talking about achieving product-market fit for a startup, but I think the key is to achieve product-market-channel Fit.

Recently we shared in our recent VC’s Newsletter on why PMDF is better than PMF. Have A Look 👇

📢 The Latest In Emerging Tech: AI

Snap partners with Microsoft on ads in its ‘My AI’ chatbot feature:
Snapchat has a new advertising partner in Microsoft for the ads it’s inserting into its AI product, My AI, an AI chatbot introduced earlier this year to the wider Snapchat user base. The company in May said it would begin testing Sponsored Links in My AI — link suggestions that are paired with the user’s conversation with the AI helper. More Here

OpenAI gives ChatGPT a voice for verbal conversations:
ChatGPT is evolving into much more than a text-based search engine, with OpenAI announcing today that it’s adding new voice and image-based smarts to the mix. The wildly popular generative AI assistant has been one of the biggest technology success stories of recent times since its debut some nine months ago, allowing anyone to generate essays, poems and summaries from simple text-based prompts. But now, ChatGPT is about to get a lot more interactive, with users also able to have a voice conversation with the chatbot. More Here

Google is killing Gmail’s basic HTML view in 2024: The company is sunsetting Gmail’s basic HTML view, which allows users to look at their emails in a barebones state, starting January 2024. The company updated its support page to reflect that Gmail will automatically switch to the Standard view after the deadline date. Users on Hacker News posted that they got an email from Google signaling the end of the feature. More Here

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📢 Startups Snap: The Latest Buzz

Hackers steal $200M from crypto company Mixin: Hong Kong-based crypto company Mixin announced on Sunday that it was breached and that the hackers stole around $200 million. “In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network’s cloud service provider was attacked by hackers, resulting in the loss of some assets,” the company wrote on X, formerly Twitter. More Here

Bitcoin Has Become Boring. Here’s What Could Wake It Up: A weird thing is happening to Bitcoin BTCUSD -0.15% : It’s become really boring. By almost any measure, crypto fatigue has settled in. Prices have flatlined, trading volume has collapsed, and hardly anyone outside the industry seems to care about crypto anymore. Google searches for Bitcoin are off 87% from their peak in 2021. Searches for “cryptocurrency” are down 96%. Crypto trading “has been as boring as watching paint dry,” says Dave Weisberger, head of crypto trading platform CoinRoutes. More Here

Reddit will start paying you real money for good posts: Reddit announced a contributor program on Monday, which awards users actual, real money for their fake internet points. Now, eligible users will be able to convert their Reddit gold and karma into fiat currency (no, not crypto), which is disbursed once per month. More Here

The recent tech IPOs are flirting with negative territory:
The IPOs of Instacart and Klaviyo last week brought much-needed liquidity to the startup ecosystem, enlivening hopes of more exits in the weeks and months ahead. Sure, there have been some mergers and acquisitions in startup land, but massive exits all but require IPOs, so it was great to finally see tech managing a public listing or two. More Here

What’s the best way to run a startup in a world full of advice?:
There exist a myriad of answers to the question, “How do you found your first startup?” But which of those answers apply to you and your situation? Whose advice do you follow when the world’s full of people ready with suggestions? More Here

The current labor market is a gold mine of talent for startups:
For any company, great talent is key for hitting goals and building scale successfully, but hiring the best people is by no means done cheaply or quickly. Startups have it doubly hard, though: In addition to finding great talent, they have to convince them to accept lower compensation — and sometimes more work — than they would get from working for a larger tech company. More Here

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

  • ​What I have learned from users By Paul Graham? Read More (Startups)

  • Does an AI Premium Exist in the Fundraising Market? Read More (Technology)

  • Startups Fail All The Time, But Many Could Fail Better By Thinking Beyond the VCs and Founders Read Here (Startup)

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

  • Hidden Clauses In The Term Sheet that Every Founder Should Know Read More (Startup & Venture Capital)

What Do You Think Of Today's Newsletter? 🤓

✍️Written By Sahil R | Venture Crew Team

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