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| Hey Insiders, Today we are taking a look at Databricks' acquisition of MosaicML, which sectors investors keenly investing in, and why shareholders decided to shut down messaging startup IRL. Scroll down for some quick hits, and then let us know what other content you'd like to see in future issues. Karan
p/karan-chafekar | |
| 1 | | Data and AI firm Databricks signed a definitive agreement to acquire generative AI startup MosaicML. The deal is worth $1.3B. The acquisition will enable Databricks to empower clients to develop their own generative AI models based on their proprietary data. More: - Databricks CEO and co-founder Ali Ghodsi said, "Every organization should be able to benefit from the AI revolution with more control over how their data is used."
- MosaicML's large language models will be incorporated with the Databricks Lakehouse Platform.
- Databricks claims that the platform will be able to deliver 2x to 7x faster model optimization speeds than traditional approaches.
- To date, MosaicML has raised $64M from investors, including DCVC, AME Cloud Ventures, Lux, Frontline, and Samsung Next.
- The price paid for the acquisition represents a six-fold increase over MosaicML's last known valuation of $222M.
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What the numbers say: Generative AI, clean energy tech, esports, and future of work startups are a few of the standout sectors that raised substantial seed funding so far this year. On the other hand, investments in alternative proteins, consumer products, fast delivery, e-commerce, and cannabis companies declined. Relevance: XetHub, a collaborative platform for developing generative AI apps, raised $7.5M in seed funding from Madrona earlier this January. Within the energy sector, French magnetic confinement fusion startup Renaissance Fusion secured $16M in funding led by Lowercarbon Capital. Esports web3 and online mobile gaming platform Matchday secured $21M in seed funding. The largest round within the future of work domain went to construction crew management and scheduling startup Rivet, which nabbed a $5.3M round led by Defy.vc. Where to see the impact: Seed stage funding has shown resilience to the venture funding drop. However, the median time taken by seed startups to raise subsequent Series A rounds has increased to 25 months. Investors are taking longer to ink deals to ensure they can perform proper due diligence on potential investment opportunities. | | | |
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| 3 | | Paris-based venture capital firm Frst is raising its second fund, collecting $80M for seed-stage investing. The firm says half of its portfolio companies were sent term sheets before incorporating. More: - The VC firm's first fund totaled approximately $100M.
- Frst's liquidity providers include Bpifrance's Fonds National d'Amorçage 2, AXA Venture Partners, Isomer, and the European Investment Fund.
- The areas of focus for the new fund include medicine, defense, natural resource management, and education.
- The firm expects to invest between €1M and €3M in approximately 30 startups.
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| 4 | | Shareholders of messaging startup IRL decided to shut down the startup and return money to investors after an investigation revealed that 95% of its users were bots. Company spokesperson Elliot Sloane told The Information that "a majority of shareholders concluded that the company's going forward prospects are unsustainable." More: - Troubles mounted at the firm after a former employee accused the company of inflating user counts by using bots.
- Several other employees began raising the same concern, prompting the SEC to investigate the startup to determine whether it had violated securities laws.
- The board suspended co-founder and CEO Abraham Shafi for alleged misconduct two months ago.
- Shafi claimed that the platform had 20 million active monthly users.
- The firm had raised $200M from SoftBank's Vision Fund, Founders Fund, and others.
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| 5 | | BentoML, a platform for developers of AI applications, raised a $9M Seed round led by DCM Ventures, with participation from Bow Capital. The startup began as open-source in 2019, expanding to a self-hosted enterprise SaaS model. More: - BentoML has expanded its membership organically by 4x to more than 3,000, including social networks Line and Naver.
- The company expects the platform to be comprised of 90% AI app developers in the future.
- "If you ask me a year ago, I'd say that probably 90% of the companies would be training their own models, but the foundation models that have recently emerged are so powerful that they can perform well even given a dataset it has never seen before," said BentoML co-founder Chaoyu Yang, who previously was an early engineer at Databricks.
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| 6 | | Space mission management startup Continuum Space announced it raised a $3M Seed extension round led by Prophetic Capital Partners. The new round brings the company's total to $6M. More: - The company seeks to simplify the mission management process through a SaaS model.
- The software is in part based on development at Caltech, which owns 3% of the startup.
- Continuum claims the U.S. Space Force, Radian Aerospace, and Accion Systems among its clients.
- Other participants in the round include Mandala Space Ventures, Freeflow Ventures, Explorer 1 Fund, and Unlock Venture Partners.
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| 7 | | 
Last week, we asked our startups community, "What is the most valuable piece of feedback you've received on your startup journey?" Here are some highlighted responses we received: - Mike Bal (p/mikebal), Head of Product Strategy at Automattic, answered: The most valuable piece of feedback was actually a pretty harshly delivered message early on in my career that set me on a path to understanding data and be more data-driven in everything I do. The feedback itself was given when I was working in social media marketing and it was something like, "No one gives a shit if it's the most engaging post they have ever had, they only care if it's driving conversions."
- E. James White (p/ejameswhite), CEO at LivestockCity, answered: "Don't chase investors or investment money. If what you're doing is good enough, the investors will come to you." Once I was given this advice, I went all-in on developing my startup and finding ways to get it launched. We are probably moving slower than we would right now if we had investors. But I understand it's about metrics, and we are still too early to show enough metrics data. But that's okay, we are going as fast as we can in the situation we're in. Our day will arrive eventually.
Join the conversations at Inside.com, and we may shout out your name and business or contact you for more! ⭐️ | | | |
| 8 | | Quick Hits: - Kubernetes doesn't need to be complex. Join us for a conversation about how to increase developer productivity & reduce your pull request time by 75%.*
- Defense startup Anduril Industries is acquiring conventional and hypersonic missile rocket motor startup Adranos for an undisclosed sum.
- AI-powered analytics platform ThoughtSpot acquired business intelligence startup Mode Analytics for $200M in cash and stock. The move will enable ThoughtSpot to increase its annual recurring revenue to above $150M.
- Travel tech startup utu raised $33M in Series B funding led by SC Ventures. The firm also disclosed that it had acquired Singaporean fintech startup CardsPal.
- British fintech startup TreasurySpring nabbed $29M in Series B funding led by Balderton Capital. Mubadala Capital participated in the funding round along with existing backers ETFS Capital, MMC Ventures, and Anthemis Group.
- It's never been easier for your sales organization to accelerate growth. Learn how AI, and more, can help you sell in a whole new way.*
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INSIDE STARTUPS LEADERBOARD (7 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot.
Nicolas is a Sr. Analyst at Inside, covering startups and transportation trends. He is an avid map maker and data nerd. Nicolas has worked in the shared-scooter space, as well as advised e-bike and moped start-ups. | | This newsletter was edited by Beth Duckett | |
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