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| Hey Insiders, Here are the latest stories: - Anthropic to raise another $2B funding, a week after raising $4B from Amazon
- Global VC deal value slides to $73B in Q3
- Greylock raises $1B fund to invest in enterprise and consumer software
If you find this newsletter useful, please share it with your friends and colleagues. Thank you. Karan
p/karan-chafekar | |
| 1 | | Anthropic is in talks with investors, including Google, to raise another $2B in funding, barely a week after it secured new funding from Amazon, sources told The Information. Last week, Amazon committed to making a $1.25B initial investment in the company, which could potentially increase to $4B contingent upon meeting certain conditions. More: - Anthropic, the company behind the chatbot Claude, is targeting a valuation of between $20B and $30B.
- The firm was valued at $4B when it raised its funding round earlier this March, when it raised a $450M funding round from Google, Salesforce Ventures, Zoom Ventures, and others.
- Google reportedly had a 10% stake in the firm in 2022.
- Anthropic's internal documents that leaked earlier this year hinted at the firm's plans to raise $5B over the next two years to build out the next version of its chatbot called Claude Next, which could possibly be 10 times more powerful than existing generative AI systems.
- The company estimates that it would require computing infrastructure that can deliver 10 septillion floating point operations per second, or FLOPs, to power Claude Next.
Q: Are AI startups just raising as much funding as they possibly can to take advantage of the hype around the sector? Join the conversation here. |     | |
| 2 | | Global venture capital deal value in Q3 2023 amounted to $73B, reaching the lowest quarterly total since Q2 2020, per Pitchbook and NVCA's Q3 2023 Venture Monitor report. 
What the numbers say: Deal count continued to drop in the U.S., impacting later-stage VC deals the most. Deal sizes and valuations have also declined considerably since last year, especially across the late and growth stages. Relevance: Exit values showed an improvement due to three high-profile IPO listings in Q3, ending the quarter with $35.8B in cumulative exit value from 300 exit events. Despite the recent IPO listings, investors remained pessimistic over IPO listing prospects for other companies for the rest of the year. Investors' pessimism about exit values is due to the fact that the valuations of recently listed companies were far off from their respective peak values. Where to see the impact: Europe and Latin American regions witnessed a 30% decline in deal counts. Despite the dip in deal count, deal value increased in Europe. On the other hand, Asia saw the lowest decline in deal count, dropping just 10% compared to the previous quarter. Latin American region matched 2022's total deal value, while all other regions showed significant slumps. Analysts expect the market to show signs of recovery in 2024. | | | |
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| 3 | | Greylock secured $1B in capital commitments toward its 17th fund to invest in pre-seed, seed, and Series A stage startups. The fund will back enterprise and consumer software startups, including AI-first companies across cybersecurity, infrastructure, SaaS, fintech, crypto, and consumer sectors. More: - The current fund's size is the same as its predecessor 16th fund, which closed in September 2020.
- Greylock also announced a new program called Greylock Edge, designed to help early-stage founders brainstorm ideas, iterate plans, and achieve product market fit.
- In addition, Greylock will provide flexible financing options to startups entering the Greylock Edge program.
- The firm is known for its previous bets, including Airbnb, Discord, Figma, Meta, LinkedIn, and Palo Alto Networks.
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| 4 | | Digital health VC firm 7wireVentures closed its growth and opportunity fund at $217M. With the close of the new fund, 7wireVentures' assets under management crossed the $500M mark. Two-thirds of the fund is earmarked to double down on existing portfolio startups, with the remaining for new investments between Series B and Series C stages. More: - The firm will invest over the next three to four-year time frame.
- 7wireVentures has invested in 25 portfolio companies from the previous two digital health funds.
- Notable portfolio investments include care navigation platform Jasper Health and UVB light therapy startup Zerigo Health.
- The firm has already invested in three startups from the new fund: OCD treatment and therapy platform NOCD, virtual care platform Folx Health, and virtual clinic Parsley Health.
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| 5 | | Phoenix-based VC firm AZ-VC, which raised a $110M fund in 2020, has already invested $30M in startups, managing partner Jack Selby told Business Journals. While other investors have reduced their dealmaking, AZ-VC has kept up the momentum, said Selby. The firm claims it was among the most active first-time VC funds in the Mountain West during the past year. More: - The firm has seven startups in its portfolio, including Nuclearn, Bluetail Inc., and Right-Hand Cybersecurity.
- AZ-VC's fund was anchored by Arizona Public Service with a $25M commitment.
- The fund has about 85 limited partners, 90% of which are based in Arizona.
- Other LPs that backed the fund include Bridge Bank, Salt River Project, Trinity Capital, Todd Davis, and George Getz.
- Selby reckons that now is a "remarkable time" to be a VC investor as entry-point valuations have dropped as much as 50% than market averages.
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| 6 | | Today's Funding: Biotech - Akura Medical raised $35M in Series B funding led by The Capital Partnership and Cormorant Asset Management.
CleanTech - Green hydrogen electrolyzer maker Electric Hydrogen closed its oversubscribed Series C funding round at $380M. Fortescue, Fifth Wall, and Energy Impact Partners led the round, with participation from bp Ventures, Temasek, Microsoft's Climate Innovation Fund, and others.
Fintech - Loop, a startup providing audit and payment solutions for logistic companies, bagged $35M in fresh funding led by JP Morgan Growth Equity Partners and Index Ventures.
- Commodity market intelligence firm Sparta Commodities bagged $17.5M in Series A funding led by FirstMark.
Healthcare - Cortica, a healthcare startup that provides therapies for kids with autism, extended its Series D round with an additional $40M funding led by CVS Health Ventures. The fresh funding brings the Series D round's total to $115M.
PropTech - Composite structural building system firm Renco USA raised $18M by issuing convertible notes. The transaction values the company at $318M.
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| 7 | | Quick Hits: - It's been 150 years since the last great leap in engine technology. Invest in LiquidPiston to be part of the next one.*
- Flashpoint Venture Capital is expanding its footprint in the U.S. and recently opened an office in New York.
- Galapagos Capital acquired Brazilian investment firm Frontier Capital, which manages $8.3M in assets across two equity funds. Financial details of the transaction were not disclosed.
- Human capital solutions firm ADP established its corporate venture capital arm and innovation lab called ADP Ventures.
- Y Combinator roped in Luther Lowe as the head of public policy. Lowe was formerly the policy chief at Yelp.
- Emerging VC fund Erez Capital hired Arpit Garg as a general partner. Garg was previously working with Drake Star Partners as a tech investment banker.
- Even the best engineers can run into challenges. Straight from the cloud experts at DoiT, here are 5 core strategies for cloud innovation.*
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Term of the Day January Effect: The January Effect is a seasonal increase in stock prices that tends to happen in January. Question of the Week Do you share details about your salary with your coworkers? Join the conversation |
INSIDE VENTURE CAPITAL LEADERBOARD (7 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Aaron Crutchfield | |
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