This week brought a sense of respite across the startup ecosystem, allowing entrepreneurs and investors to operate outside the constant distractions of broader global news. Funding developments this week notably diverged from the ongoing volatility elsewhere, shining a light instead on future-focused ventures concerned with environmental and societal impact.
One of the standout developments involved former OpenAI executives charting new territory in artificial intelligence. Mira Murati, OpenAI’s former CTO, has attracted two significant advisers with earlier ties to the company to support her new AI-focused venture, Thinking Machines Lab. Meanwhile, Ilya Sutskever, once OpenAI’s chief scientist, turned to Google Cloud’s TPU chips to propel his new AI research-based startup, Safe Superintelligence.
OpenAI itself remains busy amid internal transitions and external conflicts. It has reportedly considered spending $500 million to acquire io Products, the AI hardware initiative created by Jony Ive and Sam Altman—although a partnership might evolve instead of an outright acquisition. Additionally, the company’s ongoing legal dispute with Elon Musk intensified further, as OpenAI filed a countersuit this week against its former backer.
Change also reverberated within HR tech company Deel, whose head of communications recently left amid controversy. Deel stands accused of planting an employee to spy on competitor Rippling, a scandal generating significant buzz within the industry.
In the bioscience sector, Colossal Biosciences made headlines claiming to have revived the dire wolf, sparking debate and skepticism within the scientific community. Discussions continue on whether the company, last valued at $10.2 billion, is sustainably valued or dangerously inflated.
The fashion marketplace Lyst brought less pleasing news to its stakeholders. Previously assessed at approximately $700 million, the company sold for just $154 million to Japanese buyer Zozo, marking a substantial discount and exemplifying the volatility of valuations.
Meanwhile, financial tech took a hit when Solid, once hailed as a promising “banking-as-a-service” platform, filed for Chapter 11 bankruptcy this week. Citing rising liabilities from expensive ongoing litigation, the company previously raised nearly $81 million and faced scrutiny following a legal challenge from lead Series B investor FTV Capital.
The venture capital scene was particularly active despite fluctuating market indices. Autonomous vehicle innovator Nuro drew attention with a $106 million Series E funding round, albeit at a reduced $6 billion valuation, down significantly from its earlier peak of $8.6 billion. The shift reflects both decreased funding needs and Nuro’s strategic focus pivoting towards licensing autonomous technology rather than direct robot fleet deployment.
Base Power, a Texas-based energy startup specializing in home battery backup systems, announced a $200 million Series B led by prominent backers including Addition, Andreessen Horowitz, Lightspeed Venture Partners, and Valor Equity Partners. Turkish fintech Sipay, labeled by some as “Stripe for emerging markets,” secured a substantial $78 million round, valuing the company at $875 million as it looks to expand internationally from its roots in Istanbul.
In further fintech news, earned wage access provider Rain raised a $75 million all-equity Series B round spearheaded by Prosus. Rain intends to leverage these funds to launch credit card and savings products. Additionally, Seattle-based Brinc Drones successfully gathered $75 million for its law-enforcement-focused drone technology, an investment led by Index Ventures in recognition of the startup’s rapid growth and notable market impact.
Krea, a San Francisco-based creative tech startup that combines generative AI tools for designers, announced cumulative funding of $83 million, boosted by a recent $47 million Series B round. Elsewhere, Artisan, notable for promoting an AI-powered sales agent under the provocative slogan “Stop Hiring Humans,” surprisingly plans to use its fresh $25 million Series A investment to hire more employees—human ones—to scale operations.
Several venture firms announced major fund closures, underscoring continued investor faith in startups. SignalFire added more than $1 billion in new capital, pushing its total assets under management past the $3 billion mark. Likewise, established New York fund Lerer Hippeau wrapped up its ninth fund at an ample $200 million, boosting total assets under management to $1.4 billion. Berlin-based VC Revent also announced an impactful $109 million Fund II targeted at ventures addressing planetary and societal crises, while DIG Ventures secured another $100 million to back early-stage European startups in AI, cloud infrastructure, and B2B software.
San Francisco Mayor Daniel Lurie made headlines this week with his public commitment at a TechCrunch event, emphasizing a proactive stance to bolster technology businesses in the city. Lurie indicated he’s personally reaching out to tech executives to explore ways in which San Francisco can better support and retain startups and encourage those who departed to reconsider returning.
