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| Here’s a look at today’s Startups briefing. - OpenAI entices Google AI employees with robust pay packages.
- Investors are easing off on favorable deal terms.
- Bill Gates-backed startup Graphyte launched today.
We also interviewed Levi Martinez and Thomas Nelson from Kitkaton, a U.S.-based startup that aims to change the way fans interact and buy things from their favorite influencers. Thank you. Karan
p/karan-chafekar | |
| 1 | | AI startup OpenAI is luring away Google AI employees with robust pay packages that include "generous equity," per The Information and Business Insider. OpenAI is also offering shares to employees at the current valuation of $27B ahead of its impending share sale transaction, which could triple the firm's valuation to more than $80B. Employees could potentially walk away with $5M to $10M in compensation from the share sale, per The Information. More: - OpenAI has hired 59 former Google employees and 34 former Meta employees, according to data compiled from LeadGenius and Punks & Pinstripes.
- The firm's recent job listing for a research engineer has an annual salary range of $245,000 to $450,000.
- Per Jan Leike, OpenAI's head of superalignment, the startup is looking to hire research engineers, scientists, and managers.
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| 2 | | Investors are easing off on pushing for favorable deal terms, according to Carta. 
What the numbers say: 6.1% of startup financing deals done through Carta involved participating preferred stocks. The share of deals involving participating preferred stocks has dropped consistently after reaching a peak of 15.6% in Q1. Deals involving such stocks had jumped from just 4.8% of rounds in Q4 2021. Alex Civetta, an associate at Mintz, said, "I haven't seen much in the way of highly investor-favorable terms lately. There was a little bit of a spike in some of that in Q1 and Q2, but it has tapered off." Relevance: VCs sought favorable deal terms in 2022 to help shield themselves from downside risks. Having participating preferred stocks helps investors to maximize their returns on exits. However, this year, investors are more focused on investing in stable startups rather than investing in riskier bets. Stable startups are less inclined to offer investor-friendly terms to VCs. This could hint at the drop in investor-friendly deal terms. | | | |
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| 3 | | 
Recently, we had the chance to speak with Levi Martinez and Thomas Nelson from Kitkaton, a U.S.-based startup that aims to change the way fans interact and buy things from their favorite influencers. Here are some of the main takeaways from the conversation: Asked about how they manage to land clients, they said they have a "database of 15,000 influencers" whom they contact and try to convince to join their platform. So far, the Kitkaton team has a 50% closing rate. We also spoke about what separates their company from the competitors, which they said is the fact that Kitkaton helps influencers diversify their income stream in a hassle-free way that helps them keep their audience in their ecosystem. You can watch the full conversation here. | | | |
| 4 | | Graphyte, a climate-tech startup backed and incubated by Bill Gates's Breakthrough Energy Ventures, launched today. The firm has developed a "carbon casting" technology to remove carbon dioxide from the atmosphere by leveraging natural photosynthesis processes. More: - Graphyte's method involves transforming waste biomass into dense carbon blocks.
- These blocks are packaged in a proprietary polymer barrier and securely stored underground in a specially engineered site.
- This process effectively locks away carbon, preventing its re-release into the atmosphere.
- The idea for the technology came from Breakthrough's partner, Chris Rivest.
- The firm later roped in Barclay Rogers as a co-founder and CEO to lead the startup.
- Graphyte boasts a levelized cost of production of $100 per ton and requires a tenth of the energy compared to direct air carbon capture technology.
- The startup is building its first plant in Pine Bluff, Arkansas, and expects to have the capacity to remove 5,000 tons of CO2 per year by the end of 2023, which will scale up to 50,000 by Jul. 2024.
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| 5 | | B2B digital adoption SaaS startup Whatfix narrowed losses by 53% in the recent financial year ending Mar. 2023. The startup halved its losses from $84M (7.06B INR) in FY 2021-22 to $39.4M (3.28B INR) by bringing down expenses. More: - The SoftBank-backed startup saw a 65% YoY boost in revenue to $34.2M (2.84B INR).
- Whatfix has raised $140M in VC funding to date.
- Notable backers of the firm include Sequoia Capital, Eight Roads Venture, F-Prime Capital, Cisco Investments, and Helion Ventures.
- Whatfix was last valued at $600M.
Zoom out: - Israeli SaaS company WalkMe has sued Whatfix for allegedly gaining unauthorized access to its systems, making misleading advertising claims, and unauthorized use of WalkMe's design mark.
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| 6 | | Executives from Mexico's startup sector are anticipating a surge in funding over the coming months as the 12-month headline inflation dipped to 4.26% and several Latin American central banks are potentially set to announce interest rate cuts. VC fund Wollef's co-founder Eric Perez-Grovas predicts "two big waves of growth" in Mexican startups, which could particularly benefit e-commerce and nearshoring logistics companies. More: - Logistics startup Melonn is gearing up for a robust sale period ahead, anticipating a significant uptick compared to the previous year.
- Co-founder Andres Felipe Archila said, "In November, we very well could move twice the volumes we moved a year ago."
- Analysts are optimistic about the economic outlook, citing decreasing inflation and stable employment levels.
- B2B startups are looking to capitalize on the potential growth opportunity due to their close proximity to the U.S., low labor costs, and supportive trade pacts.
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| 7 | | B2B auto dealers marketplace Shekel Mobility raised $7M in funding today, consisting of $3.2M in equity and $44M in debt. The firm will use the proceeds to quadruple its current annual recurring revenue. Ventures Platform and MaC Venture Capital co-led the funding round. More: - Shekel Mobility has an ARR of $2M.
- The firm also provides vehicle financing of up to $200,000, with users typically availing loans between $5,000 and $20,000.
- Earlier this January, $1.95M pre-seed funding was led by Ventures Platform.
- The auto dealer marketplace has facilitated transactions of 7,000 car sales worth $56M.
Zoom out: - There is an average annual demand of 2.4 million cars and 300,000 commercial vehicles in Africa, per the World Economic Forum.
- The African used car marketplace is valued at $30B.
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| 8 | | 
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| 9 | | Quick Hits: - Elevate your Kubernetes skills with this must-read resource for building cloud native applications. Get your Kubernetes Cookbook today.*
- The Dubai Integrated Economic Zones Authority's (DIEZ) VC division, Oraseya Capital, announced a $136M fund to back early-stage startups between pre-seed to Series B stages.
- Global venue management software platform maker Roller raised $50M in fresh funding from Insight Partners.
- Bionic prosthetics maker Aether Biomedical raised $5.8M in fresh funding led by J2 Ventures and Story Ventures.
- Robotics startup General Autonomy bagged $3M in seed funding from India Quotient, Elevation Capital, and other investors.
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Vibha Chapparike | |
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