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| Here's a look at today's Startups briefing. - 📝 Elon Musk sued OpenAI and CEO Sam Altman for deviating away from the founding mission
- 📦 Amazon aggregator startup Thrasio filed for Chapter 11 bankruptcy
- 🤖 Figure raised $675M to accelerate commercial deployment of humanoid robots
We have also rounded up the top early-stage funding rounds of this week. Thank you. Karan
p/karan-chafekar | |
| 1 | | Elon Musk has filed a lawsuit against AI startup OpenAI and its CEO, Sam Altman, for allegedly deviating away from its founding mission of creating open-source technology for the benefit of humanity. Musk alleges that OpenAI started pursuing profits, violating the original contractual agreement of making the technology "freely available" to the public. OpenAI, the world's most valuable AI startup, supposedly pivoted to a for-profit model after accepting $13B funding and forging a close partnership with tech giant Microsoft. More: - Musk was one of the co-founders of OpenAI in 2015 but left the firm's board in 2018 due to differing views on monetizing the technology.
- He donated over $44M to the non-profit arm of OpenAI between 2016 and September 2020.
- The lawsuit presented Microsoft CEO Satya Nadella's interview as evidence.
- In the interview, Nadella said that if "OpenAI disappeared tomorrow … we have all the IP rights and all the capability. We have the people, we have the compute, we have the data, we have everything. We are below them, above them, around them."
- The lawsuit further accuses Altman and OpenAI president Greg Brockman of working together to remove board members who upheld the company's original mission.
Zoom out: - Musk is raising capital for his own AI startup called xAI, which has developed an AI chatbot called Grok.
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| 2 | | VCs deployed $1.6B in early-stage North American startups this week between Feb. 24 and March 1, per Crunchbase data. Robotics sector raked in 42% of the funding this week, thanks to Figure's $675M Series B round. AI, biotech, and agtech startups nabbed 12%, 11%, and 8% of the financing, respectively. 
Here are the other top five largest rounds announced this week besides Figure: - Vertical farming firm Oishii bagged $134M in Series B funding led by Japanese telecom company NTT.
- Small molecule cancer drugs maker BlossomHill Therapeutics closed its Series B funding round at $100M. Colt Ventures led the round, with additional backing from Cormorant Asset Management, OrbiMed, Vivo Capital, and others.
- Consumer microlending platform Baubap bagged $120M in pre-Series A funding. The funding consisted of a debt facility provided by SixPoint Capital Management.
- Kenai Therapeutics, a biotech startup advancing cell therapy research for combating nervous system disorders, raised $82M in Series A funding. Alaska Permanent Fund, Cure Ventures, and The Column Group co-led the round, joined by Euclidean Capital and Saisei Ventures.
- AI-powered image generation tool Ideogram secured a Series A funding of $80M. Andreessen Horowitz led the round, joined by Index Ventures, Redpoint Ventures, Pear VC, and SV Angel.
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| 3 | | Amazon aggregator startup Thrasio filed for Chapter 11 bankruptcy protection. The firm entered into a restructuring agreement with some lenders, reducing its debt by $495M. Some existing investors have also agreed to invest $90M in fresh capital into the firm. More: - The firm has suffered in recent years due to a reversal in online shopping demand after consumers resumed their normal in-store shopping habits.
- Thrasio touched a peak valuation of $10B and had raised about $3.4B from investors.
- Notable backers of the firm include Silver Lake, Oaktree Capital Management, and Goldman Sachs Asset Management.
- The bankruptcy filing shows Thrasio has assets between $1B to $10B, with estimated liabilities ranging from $500M to $1B, per Reuters.
- Former Amazon Global Prime leader Greg Greeley succeeded CEO Carlos Cashman, who was replaced in early 2022 due to the firm's failure to go public and resulting layoffs.
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| 4 | | Humanoid robotics startup Figure secured $675M in Series B funding from Microsoft, OpenAI Startup Fund, NVIDIA, Bezos Expeditions, Parkway Venture Capital, Intel Capital, Align Ventures, and ARK Invest. The firm was valued at $2.6B. Figure will use the proceeds to accelerate the commercial deployment of its humanoid robots. More: - In addition to the funding, the startup also inked a partnership with OpenAI to develop the next generation of AI models for humanoid robots.
- According to an earlier report from January, Microsoft planned to invest $95M in the round, with OpenAI contributing $5M.
- Figure AI is developing its first humanoid robot, dubbed Figure 01, to handle hazardous tasks unsuitable for humans and help alleviate labor shortages.
- The Sunnyvale, California-based startup inked its first commercial deal with BMW Manufacturing this January.
- BMW will deploy Figure AI's humanoid robots in its automotive manufacturing facility in Spartanburg, South Carolina.
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| 5 | | Norwegian car dealership Brages Bilforretning's CEO, Espen Digernes, bought bankrupt Swedish electric motorcycle company Cake for an undisclosed sum. Cake, which had raised $74.4M from investors, went into bankruptcy last month. More: - Cake's founder and CEO Stefan Ytterborn blamed the startup's failures on the waning focus on climate issues and the global economic slump.
- Since its founding in 2017, the startup has sold about 6,000 high-performance electric on and off-road motorcycles.
- It is unclear whether Digernes has purchased Cake's entities outside of Sweden.
Zoom out: - Earlier this week, eMoto bought Cake's remaining motorbike and parts inventory in the U.S.
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| 6 | | AI software startup Synth Labs is emerging from stealth this week with a seed funding round. The firm is trying to solve the AI alignment issue and ensure that AI systems act according to the user's intentions. More: - Synth Labs aims to ensure that AI models operate as the developers intended.
- The seed funding is reportedly coming from Microsoft Corp.'s VC division M12 and Eric Schmidt's First Spark Ventures.
- Eleuther AI's founders Louis Castricato and Nathan Lile founded Synth Labs along with Eleuther AI's executive director Stella Biderman and biotech startup Illumina's former CEO Francis deSouza.
- The startup has not disclosed the amount it has raised so far.
- "The way that we're thinking about designing some of these early tools really is all about giving you the opportunity to decide what alignment means for your business or your personal preferences," said Lile.
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| 7 | | Quick Hits: - Business Owners who took Visa or Mastercard from Jan. 1, 2004, to Jan. 25, 2019, apply to see if you are entitled to a portion of a $5.6B payout.*
- Spreadsheet startup Row Zero raised $3M in seed funding from Founders' Co-op, Ludlow Ventures, Wes McKinney, and GTM Fund.
- Endpoint security startup Morphisec promoted Ron Reinfeld to the CEO role, succeeding Ronen Yehoshua, who will transition into the president position. Before joining Morphisec three years ago, Reinfeld held the CFO roles at IntSights and Zooz.
- Danielle Varvaro, Christopher Parks, and Brad Bosserman, three former employees of The Messenger, are suing the media outlet for not paying them severance packages after the firm shut down. According to their contracts, the trio are eligible to get at least six months of their base salary if their jobs were terminated without a clause.
- German solar startup Enviria raised $200M in Series B funding from BlackRock.
- Uncover the trends shaping the business landscape in 2024. From building trust to leveraging tech, our report shares crucial developments for success.*
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Aaron Crutchfield | |
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