Monday, July 17, 2023

U.S. accounted for 43% of global crypto investments / New business applications in San Francisco area dropped in 2022 / FAA to evaluate Loft Dynamics' VR headsets

Plus, Cisco plans to acquire identity and access management startup Oort

Inside Startups

For July 17, 2023

Hey Insiders,

Today we are taking a look at the U.S.'s share of global crypto investments, why new business applications in the San Francisco area dropped in 2022, and FAA's evaluation of Swiss startup Loft Dynamics' VR headsets in flight training.

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

The U.S. accounted for 43% of global crypto investments in Q2, according to crypto investment firm Galaxy Digital. In terms of the amount raised, the U.S. represented 45% of the capital raised.

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The U.S. was followed by the U.K. with 7.7% of capital investment, Singapore with 5.7%, and South Korea with 5.4%.
New crypto venture capital funds raised $720M in Q2, reaching the lowest amount since Q3 2020.
The report comes as a judge ruled partially in favor of Ripple Labs in a case brought forward by the SEC, determining that XRP was not a security when sold on exchanges.

What the numbers say: The number of new business applications in the San Francisco Bay Area dropped 9% in 2022 compared to the previous year, according to new data released by the U.S. Census Bureau. Last year, the area recorded more than 57,000 new applications. The data shows that 13 new business applications were received per 1,000 residents in 2022, down from 14 in 2021.

Why it matters: The number of new business applications is a key indicator of a region's economic vitality. A higher number suggests that founders and investors are optimistic about the area's future prospects. Per a new report from CBRE Group, the office vacancy rate in San Francisco increased to 31.6% in Q2 2023. While the vacancy rate has grown, so has the demand, thanks to the new AI startups emerging in the region.

Relevance: The decline in new business applications extends beyond the San Francisco Bay Area. Nationwide over five million new business applications were filed in 2022, down 6.6% from the previous year's tally of 5.4 million applications. The nationwide average of business applications per 1,000 residents was 15.

The Federal Aviation Administration will evaluate Swiss startup Loft Dynamics' VR headsets in helicopter pilot training simulators. The U.S. regulator will incorporate the technology into two simulators, one used to train pilots on Airbus' H125 helicopter and the other to train for Robinson R22. The financial terms for the pilot project were not disclosed.

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The simulators are based in FAA's R&D facility in Atlantic City, N.J.
This is the first time the FAA is evaluating the use of VR headsets in pilot training.
The project's success will not equate to certification of its tech in the U.S.
Loft Dynamics has received certification from the European Union Aviation Safety Agency.
The Zurich, Switzerland-based startup has raised $20M to date from investors.

Cisco announced its plans to acquire identity and access management startup Oort for an undisclosed amount. Cisco had invested in the startup's latest round of $15M in 2022.

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Oort collects telemetry data from companies' IAM systems and scans for malicious activity. It also uses cookies installed on computers to verify logins.
"If an attacker stole an employee's credentials, giving them access to twenty different systems, Oort can identify the four systems that were actually compromised and require further remediation," said Raj Chopra, CPO of Cisco's cybersecurity segment.
Cisco plans to merge the startup's operations with its cybersecurity unit.
The acquisition is expected to finalize on Oct.29.

Nomic, the company behind the open-source model GPT4ALL, announced a $17M round led by Coatue. The New York-based startup, which employs four people, is now valued at $100M.

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Nomic also develops Atlas, which allows users to visualize unstructured datasets to build large language models.
"We want to allow people to have access to the most powerful models that are specialized for the use cases they care about, and to build those systems themselves. They need to be able to understand what data goes into those systems," said Nomic co-founder Andriy Mulyar.
The startup plans to use the funds for product development and recruitment.
The company claims 50,000 developers have used its products, including Hugging Face.

Sleepwell mattress maker Sheela Foam is set to acquire a 35% stake in Indian furniture startup Furlenco. The former will pay $36.5M for the stake, per the stock exchange filing seen by TechCrunch. The transaction value gives Furlenco a valuation of $104.3M. Sheela Foam is acquiring the stake to "enter the fast-growing branded furniture market."

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Furlenco has raised over $225M in total equity and debt funding to date, of which $140M came in through a Series D round in mid-2021.
Per Sheela Foam's regulatory filing, Furlenco generated $18.5M in revenue in the financial year ending Mar. 2023.

Zoom out:

Sheela Foam also acquired a 94.66% stake in Kurlon Enterprises for $262M.

Last week, we asked our startups community, "What positive impact do you hope your startup will make, and why is it personally important to you?" Here are some highlighted responses we received:

Michael Mossinsohn (p/michael-mossin), CCO at RevAmp Technologies, answered: "Our startup (RevAmp Technologies) develops a generator that can supply enough electricity to power an entire (average US) home. Think of a solar panel with a smaller footprint that works 24/7. The idea is to provide a scalable and reliable solution to our energy needs, reduce the need for batteries, and eliminate our dependence on fossil fuels (for energy production). The impact should be to render climate change 'old news' in about 5 years and make energy cheaper across the board. I personally enjoy coral reefs as well as hot showers during the winter. I hope soon I'll be able to use hot water during the winter without contributing to the acidification of oceans."
Lida Liberopoulou (p/lliberopoulou), Founder at ArchaeoXR, answered: "My project is about reconstructing archeological sites in VR as the where in the past and making them fully explorable, intractable and narrative driven experiences. The end goal of this project is to eventually make these places available to everyone in the world and allow people to learn and experience them in their own way and at their own pace. I always loved visiting places like the Athens Agora and the Acropolis and in recent years this has become more and more difficult as tens of thousands of people tour them every day, especially during the summer."

Join the conversations at Inside.com, and we may shout out your name and business or contact you for more! ⭐️

Quick Hits:

It's true: there really is a once-in-a-lifetime IRS kickback available to 80% of businesses. Apply Now.*
Israeli VC firm TLV Partners' Fund V secured $250M capital commitments from investors to invest in AI, developer tools, cybersecurity, fintech, and biotech sectors in the nation.
Herself Health, a St. Paul, Minn.-based startup providing primary care to women over the age of 65, raised $26M in Series A funding led by Michael Cline with participation from Juxtapose.
General Motors acquired Israeli battery software startup ALGOLiON for an undisclosed sum.
Web3-based music platform Sound nabbed $20M in Series A funding led by a16z crypto. Palm Tree Crew, Scalar Capital, A Capital, Sound Ventures, Archetype, and others participated in the round.
Level up your AWS knowledge. Packed with tips and tricks, the Amazon Web Services Cookbook is a must-have resource for both novices and experts.*