European VCs crush North American rivals

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🇺🇸 🇺🇸 We hope you had a fantastic Independence Day! 🇺🇸 🇺🇸

In this special Friday edition of our Startup Club news digest, we have some exciting updates to keep you in the loop 🕶️

Are European VCs outperforming their North American counterparts? A new report suggests just that 🇪🇺 🥊 Additionally, Google is taking significant steps to curb deepfakes during elections, though its latest environmental report seems to have overlooked a critical detail… AI 🤯 🗳️

Keep reading for more insights! 👇

Six bullets of updates

  1. 📄 Google's latest environmental report sidesteps AI's hefty energy costs, sparking more questions than answers.

  2. ⚖️ Perplexity AI, valued at $3 billion, faces plagiarism and web-scraping accusations from top news outlets Forbes and Wired.

  3. 🤖 Nubank acquires AI startup Hyperplane to boost its tech and enhance services for over 100M customers in LatAm.

  4. 🧪 Altrove uses AI models and lab automation to create new materials, aiming to disrupt the $500B materials market.

  5. 🏗️ Sensorita uses digital twins to streamline construction waste, addressing the EU's 35% waste problem.

  6. 📉 Indian edtech Unacademy cuts another 250 jobs, marking its latest round of layoffs as the sector struggles.

European VCs crush North American rivals

A new report from Invest Europe and Cambridge Associates reveals that European venture capital (VC) returns have outperformed North American VC returns over 10 and 15-year horizons. Specifically, European VC achieved a 20.77% net internal rate of return (IRR) over ten years and 16.57% over fifteen years, compared to North America's 18.18% and 16.09% respectively. However, North American VC surpasses European VC in 20-year returns and faster investor paybacks. Notably, one European fund has achieved an IRR exceeding 100%, highlighting exceptional performance in the region.

Despite these strong returns, first-time European funds tend to underperform compared to established ones, with seasoned funds showing higher total value to paid-in capital (TVPI) and IRR. Data shows that VC fund performance varies significantly by vintage year, with 2011 and 2016 being standout years, while pandemic-era funds from 2021 and 2022 show poor early performance. Read more!

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These companies just raised money

  1. Industry Ventures raises a $900M fund to back small, early-stage VCs and fuel their breakout startups.

  2. CRMBonus raises $10M in Series B extension to expand its fintech and AI-powered CRM solutions across LatAm.

  3. 💄 Beauty tech startup BoldHue raises $10M to ship its 'Keurig for makeup,' a device that customizes foundation.

  4. 🚀 raises $2.6M in seed funding, led by January Capital, and appoints Aik-Phong Ng as CCO to boost growth.

  5. Brazilian SaaS startup OmniK raises $1.2M to fuel 200% growth and expand operations to Europe and Latin America.

Google's latest policy to combat deepfake misuse

Google has updated its advertising policies to require that political ads using generative AI and deepfakes clearly disclose the presence of synthetic media. This new rule, effective November 2023, mandates that text, audio, or video generated by AI must be prominently labeled to inform viewers that the content has been altered or created artificially. This policy aims to counteract the growing use of deepfakes in political campaigns, which can easily manipulate public perception by depicting candidates saying or doing things they never did.

The updated policy is part of a broader effort by tech companies to mitigate the risks associated with AI-generated content, especially in the context of elections. Google’s move comes amidst increasing use of AI in political ads, such as those run by the Republican National Committee and Ron DeSantis's campaign, which included AI-generated images and videos with minimal disclaimers.

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