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| Here’s a look at today’s Startups briefing. - 🧠 Elon Musk’s startup Neuralink completed its first human brain implant.
- 🤝 Productivity app ClickUp acquired calendar app Hypercal as global M&A transactions plunge.
- 🇬🇧 Dutch neobank bunq gears up for U.K. relaunch as it reports first annual profits.
Thank you. Karan
p/karan-chafekar | |
| 1 | | Brain computing interface startup Neuralink implanted its device in a human for the first time on Sunday. Co-founder Elon Musk announced in a post on X that the patient "is recovering well" and showed "promising neuron spike detection." More: - The news comes eight months after Neuralink received approval from the Food and Drug Administration to conduct its first human clinical study.
- The San Francisco, Calif.-based startup's brain implant technology is designed to assist patients in using external technologies.
- Musk said Neuralink's first product will be called Telepathy, which should help people use their phones or computers using only their thoughts.
Zoom out: - Neuralink's competitor, Precision Neuroscience, conducted its first-ever in-human clinical study last June.
- Precision Neuroscience was founded by one of the co-founders of Neuralink.
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| 2 | | Productivity software startup ClickUp acquired calendar app startup Hypercal for an undisclosed amount. 
What happened: Hypercal's founder Ricardo Clerigo is set to join ClickUp as the head of calendar. The British startup connects calendar and task management applications. With the acquisition, ClickUp will be able to expand its product offerings and integrate Hypercal's AI-powered features into its productivity suite. ClickUp last raised a $400M Series C funding round co-led by Andreessen Horowitz and Tiger Global in October 2021. What the numbers say: ClickUp's acquisition of Hypercal comes amidst a declining M&A trend in venture-backed startups. 1,738 venture-backed global startups were acquired last year, 31% lower compared to 2022's tally of 2,507 deals. M&A transactions continued to drop each quarter, with the Q4 2023 closing out just 340 deals. The U.S. mimicked the global trend, with venture-backed startup acquisitions dropping 30% between 2022 and 2023. | | | |
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| 3 | | Direct-to-consumer startups are struggling as venture capital for the sector dies down. VC invested just $130M into DTC startups until November last year, a fraction of the $5B funding secured in 2021, per Crunchbase data seen by Axios. The DTC sector struggled after the pandemic-fueled demand declined, and consumers started returning to brick-and-mortar stores. More: - The pandemic highlighted the limits of e-commerce.
- Several startups in the sector are struggling without VC funding due to high customer acquisition costs, low customer retention, costly returns, and inventory issues, per advisory firm Carl Marks' managing director Howard Meitner.
- Meitner adds that it is difficult for a DTC business to be profitable.
- A 2023 report from VTEX supported that claim and noted that 37% of retailers are falling short of their e-commerce profit goals.
- Additionally, 22.5% of retailers are witnessing falling demand and increasing average inventory volume.
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| 4 | | Dutch challenger bank bunq has filed an Electronic Money Institution (EMI) license application with the Financial Conduct Authority (FCA) as it looks to restart services in the U.K. Bunq retreated from the U.K. market in 2020 due to Brexit. More: - The expansion news comes as bunq reported its first full-year profit of €53.1M ($57.5M) in 2023.
- It reported a €16.5M ($17.8M) loss in the previous year.
- Bunq attributes its profitability to a fourfold growth in user deposits, which touched €7B ($7.58B) by the end of the last quarter of 2023, and a 20% surge in fee income.
- The startup operates in over 30 markets across Europe and has more than 11 million users in the region.
- Bunq strategically targets the U.K.'s 2.8 million digital nomad and remote worker population.
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| 5 | | South Korean AI chip maker Rebellions Inc. raised $124M in Series B funding led by wireless carrier KT Corp. The firm will use the proceeds to accelerate the development of its next-generation AI chip, ramp up production of its data center-focused chip Atom, and expand its team size. Rebellions was valued at over $650M in the recent round. More: - Pavilion Capital, KT Cloud Co., Shinhan Venture Investment Co., Koreyla Capital, and DGDV participated in the round.
- Rebellions will use Samsung's 4-nanometer technology to develop its third AI chip, dubbed Rebel.
- The two companies hope to complete the development by the end of this year and start mass production by the next year.
- Since its founding in 2020, the company has raised about $210M in VC funding.
Zoom out: - Rebellions is one of the several startups trying to challenge established semiconductor leaders such as Nvidia.
- Other notable startups developing AI chips include Groq and Tenstorrent.
- South Korea has earmarked $618M to support local AI chip designers through 2030.
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| 6 | | MIT-backed VC firm The Engine spun out its accelerator division to provide support, office facilities, and lab space to early-stage startups. The Engine's former chief operating officer, Emily Knight, will lead the accelerator. The National Science Foundation awarded the firm a three-year $9.5M grant to establish 10 new regional startup incubators around the nation. More: - The Engine Accelerator will allocate office space to startups within its 200,000-square-foot building in Boston.
- Small startups with two to 10 employees have the flexibility to sign a lease ranging from 30 to 90 days.
- Medium-sized startups, employing 10 to 25 people, can opt for a two-year lease, while larger startups with up to 100 employees may commit to a three-year lease.
- "I think if the company in the large suite is still here in five years, it probably means something didn't go right with funding, and they aren't on track," said Knight.
Zoom out: - The Engine spun out from MIT eight years ago to invest in "tough tech" companies, such as quantum computing and fusion energy.
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- Enterprise-focused conversational AI solutions developer Kore.ai raked in $150M in funding from FTV Capital, Nvidia, Vistara Growth, Sweetwater PE, NextEquity, and others.
- French startup studio Hexa, formerly known as eFounder, hired unicorn startup Doctolib's senior team member Julien Méraud to assist with the newly launched vertical for improving the healthcare system. Last November, the firm secured $22M in fresh capital from investors to launch even more startups.
- Hunch Ventures-backed growth stage startup accelerator The Circle Founders Club launched a 12-week accelerator program to support early-stage climate-tech startups working on solving water-related issues in India. The 10 startups joining 'The Water Challenge' initiative are Phyfarm, Aumsat, Hydrotec Solution, Nimble Vision, WaterLab Solutions, Hygienity, Biofilm Engineers, EcoEnso, Watsan Environtech, and iSync.
- Technology and sports content company Minute Media acquired STN Video to improve its sports and culture content creation, distribution, and monetization. Financial details of the transaction were not disclosed.
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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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