| Here’s your daily VC briefing: - 🚀 Mistral AI tripled its valuation to $6B at the latest €600M Series B round
- 🎒 Edtech funding is set to hit the lowest level in years
- 💰 Tether plans to invest $1B through its VC arm next year
Thank you. Karan
p/karan-chafekar | |
| 1 | | European AI startup Mistral AI has reportedly closed its Series B funding round at €600M ($640M). Existing investor General Catalyst led the round, which consisted of €468M ($500M) in equity and €132M ($140M) in debt. The round tripled its valuation from $2B from its last $415M funding round in Dec. 2023 to $6B. More: - The raise comes just over a year after Mistral's $112M seed round as it aims to develop foundational AI models rivaling OpenAI and Anthropic.
- Co-founded by former engineers from Meta and Google's DeepMind, Mistral has swiftly released open-source AI models, Mistral 7B, Mistral 8x7B, and Mistral 8x22B, under the Apache 2.0 license.
- Its most advanced proprietary model, Mistral Large, is offered through commercial APIs along with generative AI tools like coding assistant Codestral and chatbot Le Chat.
- Lightspeed Venture Partners, Andreessen Horowitz, NVIDIA, Samsung Venture Investment Corporation, and Salesforce Ventures participated in Mistral's Series B.
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| 2 | | So far this year, edtech startups have raised just over $1B in total funding, putting the year on track for its lowest annual total in years. 
What happened: The dearth of capital isn't due to a lack of demand. Global education spending and student enrollment continue growing, with edtech adoption expected to outpace the broader market. Per Morgan Stanley, global edtech spending is expected to grow from $250M in 2022 to $620B in 2030. However, investors' interest in the sector has waned due to the failure of several well-funded startups, including BYJU's. Many edtech unicorns that raised mega-rounds are now struggling to secure new funding as profitability remains elusive. Relevance: Despite the capital crunch, some edtech startups have managed to raise sizable rounds in 2024. Notable companies securing $20M+ financings include Zen Educate, Praktika, Expressable, Modal.io, and Elevate K-12. Where to see the impact: While industry insiders expect funding to recover with newly emerging AI-powered education applications, the sector is yet to witness a rebound due to unsolved challenges. Edtech startups will need to prove sustainable business models and paths to profitability to rekindle investor confidence in a sector that has failed to produce many sustainable winners despite its growth potential. | | | |
| 3 | | Day One Ventures, the early-stage VC firm founded by former PR entrepreneur Masha Bucher, has raised $150M for its third and largest fund to date. The new vehicle dwarfs the firm's prior $20M and $52.5M funds as Day One gains traction by investing in mission-driven tech startups that tackle major societal challenges. Initial checks from the new fund will range from $1M to $2M. More: - Day One has already made five investments from the third fund, including AI-powered human longevity research firm Cradle, cloud-seeding technology startup Rainmaker, Affiniti, Astroforge, and Layer N.
- Notable investments include cryptocurrency startup Worldcoin, legal tech firm DoNotPay, and AI assistant You.com.
- So far, six portfolio companies have reached unicorn valuations, while the firm has exited 22 investments via acquisition or IPO.
- For its latest fund, Day One secured backing from institutional LPs from the U.S. and Europe as well as 14 of its own founder alumni.
- The firm also made a concerted effort to include more female investors, securing nine women as LPs to help address VC's enduring gender imbalance.
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| 4 | | Tether, the company behind the world's largest stablecoin USDT, announced its commitment to invest $1B through its venture capital arm next year. Tether Investments aims to back startups in alternative financial infrastructure, AI, and biotechnology domains. More: - Over the past two years, Tether has already deployed around $2B into these areas, of which about $1B was invested in the AI segment alone.
- Tether generated $4.5B in profits in Q1 2024 from its USDT reserves after USDT's market cap exceeded $112B.
- Recent investments include data center operator Northern Data Group, a $18.75M investment into cross-border payments startup XREX Group, and a $200M funding into brain-computer interface firm Blackrock Neurotech.
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| 5 | | Crypto VC firm CMT Digital hopes to raise $150M for its fourth fund. For Fund IV, the firm is taking a patient approach by "predominantly" investing in companies with visions that may take three to seven years to fully materialize, according to partner Sam Hallene. Areas of focus include decentralized physical infrastructure like permanent storage and internet provision, as well as stablecoins for remittances and yield-bearing tokens. More: - The fund is its largest to date, surpassing its previous $25.5M, $130M, and $100M funds.
- As one of the first VCs dedicated to the crypto space since 2018, CMT gained early access to several prominent crypto and blockchain companies, including Circle, Coinbase, Consensys, and FalconX.
- The firm also announced Gerald Brant as its head of capital formation.
- Brant brings experience from venture giants Pantera Capital and BlockTower Capital.
- At Pantera, he oversaw the firm's assets growth from $400M to $5.5B.
- Brant aims to replicate that success at CMT by expanding the firm's global investor base to capitalize on "enormous potential" in crypto's rapidly evolving landscape.
- The fundraising comes amid a crypto VC rebound of 40.3% QoQ in Q1, though investor exuberance remains tempered compared to 2022's frenzied peak.
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| 6 | | Today's Funding: Biopharma Cybersecurity - Data detection and response solutions startup Cyberhaven closed its Series C funding round at $88M. Adam Street Partners and Khosla Ventures led the round, with additional support from Redpoint Ventures, Costanoa Ventures, Vertex Ventures, Crane Venture Partners, and Wing Venture Capital.
Semiconductor - German semiconductor startup Black Semiconductor raised a fresh funding round of €254M ($273M), consisting of a €229M ($246M) grant from the German Ministry of Economic Affairs and the German state of North Rhine-Westphalia. The remaining €26M ($27.9M) will come through an equity round from Porsche Ventures, Project A Ventures, Scania Growth, Capnamic, and TechVision Funds.
Spacetech - Satellite manufacturing startup Apex bagged $96M in fresh funding co-led by XYZ Venture Capital and CRV. Other investors participating in the round include Upfront, 8VC, Toyota Ventures, Point72 Ventures, Mirae Asset Capital, and Andreessen Horowitz.
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| 7 | | Quick Hits: - 1infinity Ventures plans to raise a $500M inaugural fund to invest in pre-seed to Series B startups developing responsible, safe, and green AI.
- Veteran Ventures Capital held the first close of its Fund II at $25M, reaching halfway towards its target of $50M.
- Indian early-stage VC firm Huddle Ventures has secured $11.96M (1B INR) in commitments towards its second fund. The firm plans to make 20 investments in consumer brands, fintech, agri-tech, and healthcare startups, writing checks ranging from $500,000 to $1M.
- DST Global, Nexus Venture Partners, and Lightspeed Venture Partners are reportedly participating in quick commerce platform Zepto's upcoming funding round. The firm is planning to raise between $300M and $350M in fresh funding at a valuation of $2.5B to $3B.
- Crypto VC firm Struck Capital's principal and head of the investing team, Greg Stofman, has stepped down from his role to raise his own fund as a solo general partner. Stofman plans to raise $30M for the debut fund at his new firm Veridical Ventures to back pre-seed and seed startups in the B2B software sector.
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Karan Chafekar | |
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