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| Hey Insiders, Today we are taking a look at Telexistence's $170M Series B round, U.K. pension funds allocation to VC, and why FrontRow shut down operations. 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 | |
| 1 | | Japan-based startup Telexistence has raised $170M to bring AI-powered robots to the retail industry. Its robots are currently being used in 300 FamilyMart stores in Japan. More: - Telexistence manufactures AI-powered robots that can execute human tasks in the retail sector, such as restocking products on shelves, analyzing product data, carrying packages, etc.
- This Series B round was led by Softbank Group, Monoful Venture Partners, KDDI Open Innovation Fund, Airbus Ventures, HH-CTBC Partnership, and Globis Capital Partners.
- So far, the company has raised around $200M since being founded in 2017.
- The company is based in Tokyo, Japan.
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| 2 | | What the numbers say: U.K. Finance Minister Jeremy Hunt said that the government reached an agreement with nine of the nation's largest pension providers to allocate 5% of their assets to early-stage startups in the country by 2030. Aviva, Legal & General Group, and M&G are a few of the pension funds that have inked the agreement. If other pension funds follow suit, the initiative could unlock up to £50B ($64B) in funding for startups, per Hunt. Why it matters: The new investment strategy could boost pensioners' annual returns by an additional £1,000 ($1,283). If more pension schemes invest in VC, the average pensions could increase by 12%. Among European nations, the U.K. has the largest pension market worth over £2.5T ($3.2T). 
Relevance: The move comes amidst growing criticism over U.K.'s regulatory policies, which are driving away startups and tech companies. Notably, chip design firm Arm chose to list in the U.S. rather than the U.K. Furthermore, the poor economic conditions and Brexit caused a sharp 70% YoY drop in VC funding for U.K. startups in Q1 2023. | | | |
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| 3 | | Chip maker Black Sesame is burning $140M annually, as the company's numbers post-IPO filing have become public. The Chinese company is seen as a potential competitor for market leaders such as Nvidia and Qualcomm. More: - The seven-year-old company specializes in manufacturing chips that can be utilized to power autonomous cars.
- Black Sesame's most advanced chip, the Huashan A1000 Pro, powers Level 3 autonomous driving.
- This chip's computing power exceeds 160+ TOPS.
- Black Sesame is in the process of producing a chip with over 200+ TOPS, naming it comparable to Nvidia's Drive Orin.
- While its revenue in the last three years has tripled from $7.3M to $22M, its losses have grown even more, reaching $140M in 2022.
- Its 29% gross profit margin also lags behind Nvidia's 65% margin.
- Investors have questioned whether the company has managed to properly utilize the $115M it has raised in its seven years of operating.
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| 4 | | FrontRow, an online platform for learning creative arts, hobbies, and sports, closed down after failing to find a product-market fit in the non-academic online learning space. Co-founder Ishaan Preet Singh is exploring the possibility of selling the company's intellectual property (IP) and returning unused capital to investors. More: - The three-year-old startup had raised $18M from Elevation Capital, Eight Roads Ventures, Lightspeed Venture Partners, and Not Boring Capital.
- The Indian startup had earlier pivoted to career-oriented learning for adults and offline holistic development for kids.
- However, it soon became evident that the market size was not substantial enough, and the scope for scaling the business was limited.
- Although FrontRow managed to reach annualized revenue of $3M to $4M, the startup faced challenges in propelling further growth.
- In a previous note, Singh said, "This isn't a capital or runway question (we have over three years of runway); it's more about making sure that when you raise capital with a vision of building a large scale business, you are honest on whether that's doable in a particular market as you learn more."
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| 5 | | Wichita, Kan.-based NXTUS launched the NXTSTAGE Enterprise Engagement Series program. The program aims to foster relationships between B2B early-stage startups and potential clients among large companies. More: - NXTUS intends to rope in NetWork Kansas to expand its reach and bring in more rural entrepreneurs.
- Applications for the cohort opened on Monday.
- The cohort intends to bring 10 startups each from urban and rural areas.
- 11 large companies have joined the program to engage with startups, including Cargill, Evergy, Spirit AeroSystems, Star Lumber, and others.
- As part of their involvement, these corporate partners will contribute to workshops, engage in one-on-one meetings with cohort members, and offer a valuable "playbook" that outlines effective strategies for doing business with large organizations.
- 75% of the startups in last year's cohort came from underserved populations.
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| 6 | | Funding for Indian startups in H1 2023 has dropped to its lowest level in four years, reaching $3.8B. This figure represents a YoY 36% decrease compared to 2022, when funding reached $5.9B. More: - The three most funded verticals across the 298 funding deals made in H1 were: Software as a Service, Direct-to-Consumer, and Fintech.
- Entrepreneurs in the Indian startup ecosystem have blamed the funding winter on rising inflation, which has caused their valuations to drop significantly, thus making it impossible for them to raise rounds at their previous valuations.
- Investors claim that early-stage startups have been less impacted, but they are more pressured to create a quicker path toward profitability.
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- Energy solutions startup Nuru raised $40M in Series B funding from Global Energy Alliance for People and Planet(GEAPP), the International Finance Corporation (IFC), and others.
- The Korea Chamber of Commerce and Industry (KCCI) urged local businesses to acquire foreign companies working on advanced technologies, such as semiconductors, secondary batteries, artificial intelligence, and biopharmaceuticals, to facilitate growth into new industries and enhance the competitive advantage of domestic firms.
- Therapeutics company SpyGlass Pharma has raised a $90M Series C funding round from investors such as RA Capital Management and New Enterprise Associates.
- Indian AI startup AI4Bharat is in talks with Peak XV and Lightspeed Venture to raise a $12M funding round.
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INSIDE STARTUPS LEADERBOARD (7 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot.
Arbër is an Inside writer who also has experience in entrepreneurship. He has experience covering Consumer Tech, Venture Capital, NFTs, Crypto, Security, etc. Arbër holds a Bachelor's degree in Business from XAMK University in Finland. | | This newsletter was edited by Vibha Chapparike | |
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