The resilient industries

Six bullets of updates

1. 💻 AI takes a leaf out of hardware's book, leaning towards smaller, more efficient specialized models instead of general ones.

2. 🇮🇳 SentinelOne acquires Indian startup PingSafe in a deal worth over $100M, marking a super-fast exit for the two-year-old company.

3. 📉 InVision, a once-prominent UX design company, is discontinuing its design collaboration services by the end of 2024. Here’s why.

4. 🆕 Former Anthemis Group partner Ruth Foxe Blader launches her own fintech-focused venture firm, Foxe Capital.

5. ❗Carta, the cap table management platform, faces backlash after allegedly brokering startup shares without consent.

6. 🌶️ In a spicy response to the NYT's copyright lawsuit, OpenAI asserts the claim is "without merit" and accuses the newspaper of "intentionally manipulating prompts.

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Shaking Hands with Realism: Navigating Venture Capital's New Norms

In the wake of 2023's bear markets, the startup landscape is reshaping its approach to venture capital. The new focus is on traction, substance, and capital-efficient growth. This shift is triggered by limited partners turning more selective and venture investors raising the bar for deals. They now require evidence of a startup's potential, depth of vision, and a path towards capital-efficient growth. This has led to new rules for identifying, partnering, and pitching to the right venture investor. Key among them are:

1. Innovators should let experience guide and challenge their perspective. Finding the right venture investor requires a foundation based on vision, values, and trust. Value-add venture investors can guide founders towards signals rather than noise.

2. Persistence is crucial. It may take hundreds of meetings before getting the first "yes". However, founders should balance persistence with realistic optimism, considering the feedback at every step.

These rules signal a shift towards realism balanced with optimism in the technology venture investment scene. Read more here!

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Takeaways from this week’s podcasts

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These companies just raised money

1. 🔋 Ingrid Capacity recently raised an impressive $100 million in funding. Notably, the round occurred without disclosing information about the founders.

2. 💻 Nabla, an AI assistant for doctors, recently secured $24 million in funding to further develop and enhance its AI technology.

3. 💵 Chilean fintech Levanta recently raised $10.5 million in funding to expand Levanta's financial technology services and bolstering its market presence.

4. 🚑 Health In Her Hue, a healthcare platform focusing on women of color, recently concluded a $3 million seed funding round.

5. 🏦 Cleva, a Nigerian fintech that focuses on creating a banking platform for African individuals and businesses to receive international payments recently secured $1.5 million in pre-seed funding.

6. 💊 Bifidice, a Latin American startup that produces ice cream with probiotics technology recently secured $850,000.

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North American Startup Scene: navigating the Decline, Celebrating the Resilient industries

In 2023, North American startup funding took a nosedive, as investors cautiously reined in late-stage deals amidst a rather lackluster exit environment. The total investment for the year was $144.3 billion, a sobering decline of 37% from 2022. The final quarter felt the chill particularly, with investment in all stages (except seed) dwindling to $29.3 billion, the lowest in three years. 

Despite the overall downturn, there were a few glimmers of hope. AI, cleantech, biotech, and next-gen manufacturing sectors saw some substantial funding rounds. 

In the exit landscape, Q4 was as dreary as a rainy Tuesday, with M&A and IPO activities well below peak levels. Deal cancellations, like Adobe's scrapped $20 billion acquisition of Figma, dealt a further blow to investor returns. 

As startup investors await more favorable conditions in 2024, the future trajectory remains uncertain.

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