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| Hey Insiders, Today we are taking a look at Elon Musk's new AI firm xAI, the increase in median pre-money valuations of startups in Q2, and 73 Strings' Series A round. Scroll down for some quick hits, and let us know what other content you'd like to see in future issues. Karan
p/karan-chafekar | |
| 1 | | Elon Musk announced his new AI firm, xAI, which aims to "understand the true nature of the universe." The company's website lists 12 employees, including former DeepMind engineer Igor Babuschkin, former Google executives Christian Szegedy and Tony Wu, and former Microsoft executive Greg Yang. More: - The AI startup is incorporated in Nevada, bearing the X.AI Corp name.
- The company's website notes that the new entity is separate from X Corp, the parent company that Twitter merged with earlier this year.
- However, the newly formed AI startup will "work closely with X (Twitter), Tesla, and other companies."
- xAI is holding a live event on Twitter Spaces on July 14 to reveal more details.
Zoom out: - xAI will compete with OpenAI, the firm behind ChatGPT, in which Musk was one of the founders.
- Musk left OpenAI's board in 2018 and has criticized the creation of its for-profit arm.
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| 2 | | 
What the numbers say: Preliminary data for Q2 2023 compiled by Carta suggests that median pre-money valuations of startups have increased across all funding stages compared to the preceding quarter. The increase is especially noticeable for Series B and C startups. Relevance: Median pre-money valuations for seed stage and Series A startups remained relatively flat in Q2 2023 at $13.3M and $40M, respectively, compared to the previous quarter. Series B startups experienced a substantial increase from $81M to $101M, while Series C valuations increased from $200M to $325M. The valuation slump eased for late-stage startups, with both Series D and Series E+ startups showing slight improvement over the previous quarter. What happened: Median round sizes have increased as well. However, the increase is far more gradual than the spike seen in valuations. Median rounds sizes for Series A, B, and C stage startups in Q2 were $7.4M, $16M, and $25M, respectively. | | | |
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| 3 | | 73 Strings, which works on portfolio valuation and monitoring, raised a Series A of an undisclosed amount led by Blackstone's early-stage investment arm and Fidelity International Strategic Ventures. The company's clients include sovereign wealth funds, limited partners, and general partners. More: - The platform's clients have a combined $2T in private equity, venture capital, and private credit, including France's Eurazeo, with €35B in assets under management.
- 73 Strings co-founder Abhishek Pandey said the company plans to use the funds to provide tech solutions and expand its footprint.
- "Valuations and portfolio monitoring are two of the most critical workflows in the private capital industry, and we believe there is a significant opportunity to introduce automation and efficiency into these areas," said Stevi Petrelli, head of Blackstone Innovations Investments.
- 73 Strings' headquarters is located in Paris, with a presence in New York, London, Toronto, and Bengaluru.
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| 4 | | Electric bike manufacturer VanMoof applied for payment deferment in a local court in the Netherlands. While not a full bankruptcy, this provision enables companies to apply for protection from creditors for up to 18 months. More: - VanMoof closed all its stores and has anecdotally stopped providing bike servicing.
- The bikes' closed design and app integration makes it difficult to be repaired by external shops. Prior to announcing its deferred payments, VanMoof had announced that car repair company KwikFit NL would begin providing bike services.
- The bike company was reportedly being impacted by a return rate of 10% and high costs of repairs.
- VanMoof raised a $128M Series C led by Hillhouse Capital Group in September 2021.
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| 5 | | Austin, Texas-based test automation startup Tricentis acquired mobile application testing tool maker Waldo for an undisclosed sum. With this strategic move, Tricentis will integrate Waldo's product suite into its existing offerings, such as Testim Mobile and Tosca Mobile, expanding its capabilities in the mobile application testing domain. More: - Tricentis' chairman and CEO, Kevin Thompson, said, "We believe the combination of what Waldo brings from a depth-of-knowledge and technology perspective combined with what Tricentis offers in our breadth-of-test automation expertise will allow us to deliver higher-quality mobile applications at the speed and scale businesses require."
- Waldo provides an iOS and Android emulator to run tests on mobile applications through a browser window.
- Waldo had raised $15M in Series A funding led by Insight Partners in February 2022.
- Insight Partners also led a $165M Series B round into Tricentis in January 2017, bringing its total funding raised to date to $172M.
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| 6 | | Wavely Diagnostics raised $1.35M, led by Robin Hood Ventures, for its ear infection diagnostics app. The startup plans to release the tool through app stores later this year. More: - The company was founded by pediatric ear, nose, and throat physician at Seattle Children's Hospital, Randall Bly, and UW computer science and engineering professor Shyam Gollakota.
- "What we do is we bounce an acoustic sound wave off the eardrum, we then pick up the reflection of that ping, and then we use a machine learning classifier to determine if it's indicative of fluid or not," said the company's CEO Arna Ionescu Stoll.
- Wavely previously raised a $2.2M Seed round and was awarded a $1.8M small business grant from the National Institute on Minority Health and Health Disparities.
- Participants in the new round included Ambit Health Venture, WRF Capital, Healthtech Capital, and Princeton Alumni Angels, among others.
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- Specialty food marketplace startup Foraged has seen a 1,000% spike in repeat customers and a 400% revenue growth across the U.S. and Puerto Rico a year after its launch.
- French employee benefits startup Swile expects to become profitable on an EBITDA basis from next quarter. The company posted a loss of €72M ($80M) on a €138M ($153M) revenue last year.
- Sustainable aviation fuel startup Twelve commenced the construction of its plant on the site of a former sugar beet mill in Moses Lake, Washington.
- Allonnia, a biological solutions startup working on sustainable mining practices, decarbonization, and plastics upcycling, raised a $30M Series A extension round led by Bison Ventures. BHP Ventures, Vale Ventures, PPNG, General Atlantic, and Viking Global Investors participated in the round.
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INSIDE STARTUPS LEADERBOARD (7 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot.
Nicolas is a Sr. Analyst at Inside, covering startups and transportation trends. He is an avid map maker and data nerd. Nicolas has worked in the shared-scooter space, as well as advised e-bike and moped start-ups. | | This newsletter was edited by Vibha Chapparike | |
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