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🚨 Terraform Labs co-founder Do Kwon will face fraud charges in the US
Do Kwon, co-founder of the collapsed cryptocurrency firm Terraform Labs, will be extradited from Montenegro to the U.S. to face federal fraud charges. Kwon is also facing charges in South Korea related to the crash of Terraform's cryptocurrencies, TerraUSD and Luna, which resulted in over $40 billion in investor losses.
Following a civil trial, Kwon and Terraform Labs were found liable for fraud by the U.S. Securities and Exchange Commission and agreed to pay $4.5 billion to settle the case. Kwon was arrested in March 2023 at a Montenegrin airport while attempting to fly to Dubai. The timeline for his extradition to the U.S. remains unclear.
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🔻 What We Learned About AI From 7 Active Startup Investors This Year
In 2024, venture funding for AI companies surged to $99.6 billion, an 80% increase from the previous year. Approximately one-third of this funding targeted foundation model companies, while the remaining two-thirds went to sectors influenced by AI, including healthcare, robotics, and autonomous driving.
Interviews with seven active AI investors revealed that AI is now a primary focus for many firms, with significant investments in applied AI. Investors are shifting their attention from infrastructure to applications that can significantly impact specific sectors. Concerns about AI accuracy and reliability were highlighted, with predictions for a blend of automated and human oversight in service roles.
Additionally, new funds dedicated to AI, like Menlo Ventures' $100 million Anthology fund, have emerged to support early-stage AI startups. Investors believe that generative AI can enhance productivity and transform service revenue into product revenue. Despite the current excitement, some investors anticipate a correction in the market as the AI revolution continues to evolve over the next decade.
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💰 Here’s the full list of 49 US AI startups that have raised $100M or more in 2024
This is a list of 49 U.S.-based AI startups that have raised $100 million or more in 2024, highlighting a vibrant funding landscape despite concerns about AI fatigue. In the third quarter alone, AI companies raised $19 billion, amounting to 28% of all venture funding.
Key highlights include:
- Elon Musk's xAI raised $6 billion in November, valuing the company at $50 billion.
- Liquid AI secured $250 million, reaching a valuation of $2.35 billion.
- Tenstorrent raised $693 million, achieving a valuation of $2.7 billion.
- Other notable rounds include $400 million for Physical Intelligence, $175 million for Sierra, and $1 billion for Safe Superintelligence.
There is an ongoing investor interest in AI, with significant rounds occurring throughout the year across a variety of applications, from enterprise solutions to healthcare technologies.
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🌐 Revenue-based financing startups continue to raise capital in MENA, where the model just works
There is a rising popularity of revenue-based financing (RBF) in the MENA region as startups seek non-dilutive funding alternatives amidst tougher venture capital conditions. CredibleX, a notable player, recently raised $55 million to provide working capital to small and medium-sized enterprises (SMEs) in the region.
RBF has gained traction because many SMEs struggle to access traditional banking capital. CredibleX partners with large aggregators, allowing SMEs to apply for loans through platforms like Talabat, streamlining the process by using historical sales data for quick credit decisions.
The model is particularly effective in high-income countries like the UAE, where SMEs benefit from direct repayment structures, making recovery easier for lenders. CredibleX aims to tap into a larger pool of SMEs and is regulated by the Abu Dhabi Global Markets, reflecting a growing trend of innovative financing solutions in the region.
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🔹 AI startups attracted 25% of Europe’s VC funding
In 2024, AI startups in Europe attracted 25% of the region's venture capital funding, totaling approximately $13.7 billion, according to Balderton Capital and Dealroom. This marks an increase from 15% four years ago, with several new unicorns emerging, such as Poolside and Wayve.
Despite a generally flat year for European venture funding, the value of AI companies in the region has doubled to $508 billion, now representing nearly 15% of the total tech sector. Notably, around 349,000 people are employed in AI roles in Europe, a 168% increase since 2020.
Balderton's James Wise emphasized that early-stage AI companies can raise significant funds in Europe, similar to the U.S., contributing to a thriving ecosystem. He also noted that generative AI tools have significantly improved productivity for many companies, indicating a positive trend for the future of AI in Europe.
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🔺 Apple might be working on a smart doorbell
Apple is reportedly developing a smart doorbell that may incorporate its FaceID technology to recognize individuals approaching the door. This doorbell would wirelessly connect to a deadbolt lock, potentially allowing it to unlock automatically for residents. The project is still in the early stages, with a market release not expected before late 2025.
The doorbell might be compatible with third-party locks that work with Apple’s HomeKit, or Apple could partner with a specific lock manufacturer. While this product would enable Apple to compete with existing smart doorbells like Amazon's Ring, it could also expose the company to risks, particularly if the system were implicated in home security failures.
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🚨 OpenAI’s GPT-5 reportedly falling short of expectations
OpenAI's development of GPT-5 is reportedly behind schedule and not meeting expectations, according to a recent Wall Street Journal report. The model, code-named Orion, has undergone at least two large training runs, but progress has been slower and more costly than anticipated. While GPT-5 shows some improvements over its predecessors, these enhancements do not yet justify the significant operational costs.
To enhance the model, OpenAI is not only using publicly available data but has also hired personnel to generate new data and is utilizing synthetic data from its earlier models. The company has stated it will not release the Orion model this year, reflecting a shift in its approach to developing AI technologies.
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🔹 After causing outrage on the first day of Y Combinator, AI code editor PearAI lands $1M seed
PearAI, an AI code editor startup, faced significant backlash on its first day at Y Combinator after accusations of copying another open-source project. Following this controversy, the founders, Nang Ang and Duke Pan, quickly adapted their concept and secured $1.25 million in seed funding, including $375,000 from Y Combinator.
Initially criticized for poor licensing practices and an aggressive marketing approach, the team responded by switching to a standard open-source license and improving documentation. They are now pivoting from a standalone code editor to developing a framework that integrates various AI coding tools, allowing for a more cohesive user experience. Despite some skepticism, PearAI has received praise for its revised direction.
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🔹 Boon raises $20.5M to build agentic AI tools for fleets
Boon has raised $20.5 million to develop agentic AI tools aimed at improving logistics and fleet management. The startup's platform is designed to integrate data from various applications, enhancing operational efficiency for logistics companies that often use multiple scattered tools. Founder Deepti Yenireddy describes Boon as a supplementary team member that automates critical tasks, allowing human employees to focus on more profitable activities.
The funding includes a $15.5 million Series A round and a $5 million seed investment, led by Marathon and Redpoint Ventures. Boon currently serves about 35,000 drivers and 10,000 vehicles, achieving an annual revenue run rate of $1 million within nine months. Yenireddy, who previously worked at Samsara, aims to simplify logistics operations through a unified platform, addressing the inefficiencies of traditional systems. The startup plans to expand its offerings beyond routing and operations to include optimizing staffing and container loading processes.
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🔻 California can ban new gas cars starting in 2035, EPA says
The Environmental Protection Agency (EPA) has granted California the authority to ban the sale of most new gas and diesel vehicles starting in 2035. This decision allows California to implement its plan, which phases out fossil fuel cars in stages beginning in 2026, requiring 35% of automakers' sales to be zero-emissions vehicles. The targets increase to 68% by 2030 and 100% by 2035, with some allowances for plug-in hybrids.
The move reflects California's longstanding ability to set stricter emissions standards under the Clean Air Act. However, the incoming Trump administration is expected to reverse this decision, as it had previously rescinded California's waiver in 2019. The situation is complicated by the fact that 16 other states and the District of Columbia have adopted similar standards, and any reversal would require significant time and effort. Automakers have expressed mixed responses, with some supporting the regulations while also seeking more time for compliance.
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🔸 India’s MobiKwik surges 82% in market debut
MobiKwik, an Indian digital payments firm, saw its shares surge 82% to ₹507.5 ($6) on its market debut following a $69 million IPO. This increase pushed its market value to $464 million, surpassing its initial target of $250 million, though still below the $924 million valuation from a 2021 fundraising round.
Founded 15 years ago by Upasana Taku and Bipin Singh, MobiKwik has built a popular digital wallet platform but faces intense competition, particularly from the widely adopted UPI payment system. The company claims a user base of 161 million and serves over 4 million merchants. MobiKwik's successful listing highlights the current vibrancy of India's IPO market, with over 20 startups planning to go public next year.
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⚡️ Hexa, the startup studio behind Aircall and Swan, unveils its next batch of startups
Hexa, a Paris-based startup studio known for launching companies like Aircall and Swan, has unveiled its latest batch of startups. Originally founded as eFounders in 2011, Hexa focuses on B2B software and pairs founding teams with innovative project ideas. The studio retains a 30% stake in its startups after their first funding round.
The new startups include:
1. Annette: A health platform aiding weight loss for individuals with a BMI over 30 or Type 2 diabetes, integrating tech-augmented programs.
2. Basalt: A tool for optimizing prompts for large language models, aimed at enhancing user experience with AI.
3. DermaScan: A service for regular skin cancer screenings, featuring proprietary technology and care centers.
4. FieldX: A voice interface tool designed to streamline administrative tasks for field sales representatives.
5. LegalX: An AI product for law firms to manage large volumes of legal documents efficiently.
6. OpenCertiX: An open-source platform for SOC 2 compliance, expanding beyond current certification offerings.
7. Reki: Aids startups in navigating non-dilutive financing applications using AI.
8. SleepX: A personalized healthcare program targeting insomnia in women, combining therapy with biological data.
9. StandardX: An AI-driven customer support solution to enhance phone interactions.
10. Tandem: Focuses on improving onboarding experiences for new software users through personalized AI recommendations.
Hexa plans to continue expanding into new verticals, including healthcare and AI, and has launched a total of 44 companies to date.
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🔸 Ranked: The World’s 20 Largest Economies, by GDP (PPP)
The G7, formed during the 1970s oil crisis, consists of major high-income economies, while BRICS emerged in the 2000s as a group of growing economies from the Global South, now competing with the G7. Both are part of the G20, which represents 70-85% of the global economy.
China has been the largest economy by PPP-adjusted GDP since 2014, while the U.S. is close behind. India ranks third, with its PPP-adjusted GDP significantly exceeding its nominal GDP. Collectively, BRICS is performing better than the G7, largely due to India's growth.
PPP-adjusted GDP accounts for price level differences, providing a clearer picture of economic output for low and middle-income countries. However, it faces criticisms regarding assumptions about a common basket of goods and potential reliance on outdated data, while actual currency exchange rates remain crucial for trade and investment.
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🔸 Activate and The Engine Accelerator team up to train scientists to become founders
The journey from scientist to founder is challenging, prompting the emergence of programs aimed at supporting technical founders. Two prominent initiatives, Activate and The Engine Accelerator, have decided to collaborate to enhance their offerings. Emily Knight, CEO of The Engine Accelerator, emphasized that closer cooperation could increase the success rate of "proto-founders" transitioning to entrepreneurs.
The Engine focuses on scientists and engineers at the early stages of commercializing their research, while Activate provides two-year fellowships for more refined ideas, preparing founders for fundraising. Many participants from The Engine's recent Blueprint program have successfully transitioned to Activate fellowships, indicating a beneficial relationship between the two programs.
Currently, the partnership is in its early stages, with no financial exchanges or plans to merge. They aim to share insights on their curricula and may develop a unified application process in the future. The ultimate goal is to expedite the journey for technical founders, especially in addressing pressing issues like climate change, as both leaders believe a faster pathway to success is essential.
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⚡️ Sam Altman and Jeff Bezos are the latest billionaires to donate $1M to Trump fund
OpenAI CEO Sam Altman and Amazon's Jeff Bezos plan to donate $1 million each to President-elect Donald Trump's inaugural fund, according to reports from Fox and The Wall Street Journal. TechCrunch has confirmed Altman's personal commitment, stating that the donation is not from OpenAI itself. This follows a similar pledge from Mark Zuckerberg's Meta, which is also donating $1 million.
Bezos's donation comes as he prepares to visit Trump at Mar-a-Lago next week, marking an effort to mend their previously strained relationship. Trump has criticized Amazon and The Washington Post, which Bezos owns, in the past. Recently, Bezos has taken steps to improve ties, including blocking the Post from endorsing Vice President Kamala Harris.
Altman expressed optimism about Trump's leadership in AI, suggesting it will help the U.S. maintain its competitive edge globally. Silicon Valley generally anticipates that Trump will adopt a less restrictive stance on AI regulation. Meanwhile, Altman is currently engaged in a legal dispute with Elon Musk regarding OpenAI's transition to a for-profit model.
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🔸 Bench shuts down, leaving thousands of businesses without access to accounting and tax docs
Bench, a Canadian accounting startup, has abruptly shut down as of December 27, 2024, leaving over 35,000 businesses without access to their accounting and tax documents. The company's website is offline, except for a notice about the shutdown. Customers are advised to file a six-month IRS extension and can download their data until December 30, with a final deadline to do so by March 2025.
Bench recommends migrating to Kick, a new startup that recently raised $9 million. The sudden closure has shocked customers, many of whom expressed frustration on social media. Former CEO Ian Crosby criticized the board's decision to replace him, suggesting that such changes often lead to failure.
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✅ PharmEasy investor cuts value of its stake drastically, implying new valuation of $456M
PharmEasy is now valued at approximately $456 million, according to a filing by investor Janus Henderson, which significantly marks a 92% decline from its peak valuation of $5.6 billion. This drastic reduction comes despite PharmEasy raising over $200 million earlier this year and preparing for an initial public offering (IPO) in 2025.
The company has faced financial challenges after deferring an $843 million IPO planned for November 2021 and has relied on debt financing, including a problematic $300 million loan from Goldman Sachs. PharmEasy, which operates one of India's largest online pharmacies, has raised more than $1 billion to date but is now valued lower than the $600 million it paid for diagnostic lab chain Thyrocare in 2021.
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🔵 $132K – $149K, here’s what seed-stage founders pay early employees, based on data
This is an examination of the salaries of early employees at seed-stage startups based on data from Kruze Consulting. Founders typically pay themselves modest salaries, with average figures being $132,000 for CEOs, $134,000 for CTOs, $135,000 for COOs, and $149,000 for product leaders. These salaries are relatively low compared to senior engineers, who can earn between $180,000 and $235,000 in the Bay Area.
As startups raise additional funding, founder salaries tend to increase significantly, reaching an average of $183,000 after Series A and $218,000 after Series B. Initial hires can expect varying salaries based on their roles, with mid-level engineers earning between $100,000 and $145,000 and sales personnel earning between $80,000 and $110,000 in the Bay Area.
Equity is also a common compensation component for early employees, with first hires typically receiving between 0.5% and 4% equity. There is a financial landscape for startups as they navigate early-stage hiring and compensation strategies.
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🔔 Shuttered electric air taxi startup Lilium may be saved after all
Lilium, the electric air taxi startup that recently ceased operations and laid off about 1,000 employees, may have a chance for revival. A consortium of investors, Mobile Uplift Corporation, has agreed to acquire Lilium’s operating assets, including its subsidiaries, although the parent company will not receive any funds due to German insolvency law.
The deal is expected to close in January, and Mobile Uplift plans to rehire some laid-off workers. Lilium's CEO expressed optimism about the investment agreement, which aims to restructure the company and allow it to exit insolvency without debt. Despite previously raising over $1 billion and securing orders for electric planes, Lilium struggled financially and filed for insolvency in October after failing to secure emergency funding.
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🚨 Proton’s device aims to help those with kidney disease, and cut heart failure risks
Proton Intelligence, a Canadian startup, has developed a continuous potassium monitoring device aimed at helping individuals with chronic kidney disease and reducing heart failure risks. The company recently secured $6.95 million in seed funding, with clinical trials underway for a product set to launch in 2025.
The device will be implanted just under the skin and connect to a smartphone app, allowing patients to monitor potassium levels and receive alerts if their levels become unsafe. This innovation aims to reduce the need for in-clinic potassium testing and improve patient management, addressing the significant health risks associated with potassium imbalances.
Co-founders Sahan Ranamukhaarachchi and Victor Cadarso based their startup on extensive research highlighting the dangers of inadequate potassium monitoring. Proton competes with other companies in the sector, claiming their solution offers greater usability and clinical impact. The startup plans to enhance patient care by leveraging data to refine therapies and is supported by various investors, including SOSV and We Venture Capital.
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🚨 Palantir and Anduril reportedly building a tech consortium to bid on defense contracts
Palantir and Anduril are reportedly in discussions to form a tech consortium aimed at bidding on Pentagon defense contracts. They are engaging with other tech firms, including SpaceX, OpenAI, Saronic, and Scale AI, to create a competitive alternative to established defense contractors like Lockheed Martin, Raytheon, and Boeing.
The consortium aims to introduce a new generation of defense contractors and enhance the efficiency of providing cutting-edge technology and weapons to the U.S. government. Initial partnerships could be announced as soon as January. This development follows a recent integration announcement between Palantir’s AI Platform and Anduril’s Lattice software, suggesting a strategic collaboration to ensure U.S. leadership in artificial intelligence.
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⚡️ Meet Skyseed, a VC fund and incubator backing the Bluesky and AT Protocol ecosystem
Skyseed is a new venture capital fund and incubator focused on supporting projects within the Bluesky and AT Protocol ecosystem. Launched by Peter Wang, the initiative began with a $1 million commitment and aims to foster experimental projects that leverage decentralized social networking.
Wang, co-founder of Anaconda, has a background in supporting decentralized web initiatives. He sees Bluesky as a potential alternative for users migrating from X (formerly Twitter), emphasizing the importance of open protocols that enable user data ownership and diverse app experiences.
Skyseed will provide both equity investments and developer grants to promising projects, with initial funding checks around $100,000. The fund's growth potential could reach up to $10 million as interest increases. Wang envisions Skyseed as a collaborative space for innovators, highlighting the emergence of a vibrant ecosystem similar to the early internet. Despite challenges, such as moderation issues, Wang remains optimistic about the opportunities within the AT Protocol framework.
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🔵 EV startup Canoo places remaining employees on a ‘mandatory unpaid break’
Canoo, the struggling electric vehicle startup, has placed its remaining employees on a "mandatory unpaid break" through at least the end of the year. This decision follows recent layoffs, including nearly 100 employees, and the idling of its Oklahoma assembly facility due to funding issues. Employees will be locked out of company systems, although benefits will continue through December.
Canoo has faced significant challenges this year, including the closure of its Los Angeles headquarters and a loss of key executives. The company reported having only $700,000 in the bank as of mid-November, highlighting its precarious financial situation.
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🚨 Ex-Twitch CEO Emmett Shear is founding an AI startup backed by a16z
Emmett Shear, the former CEO of Twitch, is launching a new AI startup called Stem AI, which is currently in stealth mode. The startup, incorporated in June 2023, focuses on developing AI that aligns with human behavior, preferences, and ethics. It has secured funding from Andreessen Horowitz (a16z).
One of Stem AI's co-founders is Adam Goldstein, known for founding travel site Hipmunk. Shear has expressed strong views on AI regulation and design, criticizing current AI chatbots for being manipulative and lacking stable identities. He has previously voiced concerns about the potential dangers of advanced AI, advocating for measures to ensure safety and control.
Shear briefly served as interim CEO of OpenAI before Sam Altman's reinstatement. He earned approximately $3,720 during that period. The startup's aims may address challenges in AI alignment and safety as it develops.
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🚨 ‘We want to pay it forward’: Funding Societies raises $25M to boost capital for SMEs in Southeast Asia
Funding Societies, a Singapore-based SME lending platform, has raised $25 million in equity funding from the Cool Japan Fund, marking its first investment in Southeast Asia's fintech sector. The company aims to enhance capital access for small and medium-sized enterprises (SMEs), which contribute nearly 50% of Southeast Asia’s GDP but often struggle to secure traditional bank loans.
Founded in 2015 by Kelvin Teo and Reynold Wijaya, Funding Societies has loaned over $4 billion to more than 100,000 businesses across the region. The new funding will be used to expedite financing services and invest in AI to streamline the lending process. The startup has also expanded into payments and plans to support Japanese companies operating in Southeast Asia. Overall, it aims to address the significant financing challenges faced by SMEs in the region.
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🚨 The DOJ wants a Perplexity executive to testify in its Google antitrust case
The U.S. Department of Justice (DOJ) is seeking to call Dmitry Shevelenko, the chief business officer of Perplexity, to testify in its antitrust case against Google, which has already been determined to hold a search monopoly. The DOJ aims to explore the relationship between generative AI technologies, like Perplexity, and search access points, such as Google Chrome.
Perplexity, recently valued at $9 billion, finds itself in the middle of this legal dispute, with both the DOJ and Google requesting information from the company. Google has subpoenaed Perplexity for documents to support its claim of viable competition in the search market, but Perplexity has yet to fully comply. The outcome of these proceedings could significantly impact allegations against Google regarding its monopolistic practices.
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🛍 Nubank leads $250M round in African digital bank Tyme at $1.5B valuation
Tyme Group, a fintech operating in South Africa and the Philippines, has raised $250 million in a Series D funding round, elevating its valuation to $1.5 billion. The round was led by Nu Holdings, which invested $150 million for a 10% stake, with additional contributions from M&G Catalyst Fund and existing shareholders.
Founded in 2019 and headquartered in Singapore, Tyme operates a hybrid digital banking model, offering checking and savings accounts, debit cards, and credit services. It serves 15 million customers, with its South African brand, TymeBank, having 10 million users, and GoTyme in the Philippines, launched in 2022, amassing 5 million users.
Tyme has raised over $400 million in customer deposits and provided over $600 million in financing to small businesses. It plans to expand into Vietnam and Indonesia next year. The company remains majority-owned by Patrice Motsepe’s African Rainbow Capital (ARC), which holds a 40% stake.
This funding marks a resurgence in investor interest in fintechs after a slowdown due to rising global interest rates. Tyme aims for a New York listing by 2028 and a secondary listing in South Africa. Nubank's investment aligns with its strategy to diversify into emerging markets, where digital financial services are underpenetrated. Nubank's CEO, David Vélez, expressed confidence in Tyme's potential as a leader in Africa and Southeast Asia.
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🔵 The founders of SlideShare are making sharing docs more social with their new platform, Jaunt
Jaunt, a new social document-sharing platform launched by the founders of SlideShare, aims to leverage advancements in generative AI and the growing demand for innovative document sharing. Officially released to the public, Jaunt allows users to upload various file types, interact through comments, and follow creators, with an enhanced focus on social engagement.
The platform features a vertical feed showcasing diverse content, such as presentations and educational resources, organized into categories like Business and Science. Users can explore trending topics using hashtags, and AI tools assist in generating summaries, titles, categories, and hashtags when files are uploaded. Future AI capabilities will include document translation and summarization.
While Jaunt is still developing and competing against established platforms like SlideShare and Google, it plans to introduce additional features like direct messaging and video support. Currently bootstrapped, the company is exploring monetization options, including a premium tier and advertisements, and is seeking venture capital investment. Jaunt is optimized for mobile web use and plans to launch a dedicated mobile app within the next year.
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🚀 GM ‘blindsides’ Cruise by giving up on robotaxis
General Motors has decided to cease funding its commercial robotaxi business and will instead integrate Cruise, its self-driving car subsidiary, into its broader efforts to develop driver-assistance features and fully autonomous vehicles.
This decision surprised many Cruise employees, as GM had invested over $10 billion in the company since acquiring it for $1 billion in 2016.
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🚨 OpenAI fires back against Musk, claims he wanted an OpenAI for-profit
OpenAI has countered Elon Musk's ongoing lawsuit by disclosing emails and texts that it argues show Musk's claims are misleading. The lawsuit revolves around allegations that OpenAI has deviated from its original nonprofit mission, with tensions rising after Musk's team sought an injunction to halt OpenAI's shift to a for-profit model.
OpenAI contends that Musk's grievances stem from unresolved past disputes. The communications indicate that Musk proposed a hybrid nonprofit and for-profit structure for OpenAI as early as 2015 and later suggested merging with a hardware startup. After OpenAI rejected his demands for majority ownership and control, Musk resigned in 2018 and distanced himself from the organization.
According to OpenAI, it has offered Musk equity in its for-profit division on several occasions, but he declined each time. The company criticized Musk's legal strategy, suggesting he should prioritize competition instead of litigation.
Musk established xAI last year and has since secured substantial funding, including a recent $6 billion round. His lawsuit alleges that OpenAI is hindering competition by coercing investors not to support rivals like xAI and claims there is illegal sharing of proprietary information between OpenAI and Microsoft. OpenAI is under pressure to expedite its transition to a for-profit entity, as investors may reclaim their investments if the conversion does not occur within two years.
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