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This week in startup news, we have some contrarian bets, funding rounds from all around the world, new VC funds, and a final word of warning.
New wave: A new wave of desalination startups is working on deep-sea reverse osmosis, a technology that’s becoming easier to deploy and could bring savings, with projections that it could produce water using 30% to 50% less energy than onshore reverse osmosis.
Filling the gap: YC’s latest batch had plenty of AI startups, and some interesting enterprise ones, but the accelerator has reduced its focus on developing markets. In Africa, local accelerators backed by African YC alumni are taking this as an opportunity with new programs.
Bett(h)er: WaveForms AI, a new audio large language model (LLM) company, hopes to make AI more personable with its own foundational models. Its founder, Alexis Conneau, is obsessed with the movie “Her,” but also thinking hard about how not to create a dystopia. “We want to do precisely the opposite of what the company in that movie does,” he told TechCrunch.
Automatic for the bots: WPAI, a startup that builds AI solutions for WordPress, is getting acquired by Automattic. Its team will lead WordPress’ AI efforts.
Most interesting fundraises this week
With the end of the year fast approaching, this week brought us many funding rounds, so here’s a sample that also showcases their range, both in size and in geographic distribution.
Taking off: Archer Aviation, a startup building vertical takeoff and landing (VTOL) aircraft, raised $430 million in fresh equity funding that brought its total financing to nearly $2 billion. Archer also closed an exclusive partnership with Anduril to jointly build defense aircraft.
Stealthy no more: Berlin-based startup Upvest, which makes a stock-trading API used by some of Europe’s biggest fintech companies, raised a €100 million Series C round ($105 million) led by once-secretive VC firm Hedosophia.
Robot steps: Swiss robotics company Anybotics, an ETH Zürich spinout building quadruped autonomous inspection robots for industrial applications, raised another $60 million, bringing its Series B round of financing to a total of $110 million. The capital will help it expand in the U.S., where it recently opened an office in San Francisco.
Strong credentials: Flare, a Canadian threat exposure management startup, closed a $30 million Series B round of funding led by Base10 Partners. The company wants to help SMBs and mid-market companies thwart the rise of info-stealer malware, or software that collects login credentials, as happened in the Snowflake incident earlier this year.
Crossing the Channel: Aqemia, a French startup in the hot AI-enabled drug discovery space, raised its second fundraise of the year: a new $38 million round led by Cathay Innovation, which it will use to hire and open an office in London.
Letting VCs in: Numia, a startup from Argentina that brings offline and online customer interaction data into one place, announced a $3.5 million seed round led by Cometa. CEO Gustavo Lauria said the company is already profitable but decided to raise outside capital for the first time to reach customers that are also limited partners in venture funds.
Most interesting VC and fund news this week
Open to confusion: The OpenAI Startup Fund raised over $44 million for its fifth special purpose vehicle (SPV), which a spokesperson said “will be used to support a variety of existing portfolio companies and to make new investments.” Despite its name, the fund says it doesn’t have OpenAI as an investor but that its backers include Microsoft and other OpenAI partners.
New dimension: Dimension Capital raised an oversubscribed $500 million fund to keep on investing at the intersection of tech and life sciences. Portfolio companies include AI biotech companies Chai Discovery and Enveda Biosciences.
Paper tiger: Known for the “spray and pray” strategy that led it to invest in over 315 startups in 2021 alone, the 15th fund of hedge fund Tiger performed particularly poorly, with paper losses standing at more than 15%, according to a recent disclosure.
Last but not least
In an interview, Lead Edge Capital founder and managing partner Mitchell Green told TechCrunch editor-in-chief Connie Loizos that there is “too much money chasing too few companies that are overvalued.” This makes his firm increasingly steer away from typical venture capital deals and toward buyout-like “control deals” more commonly associated with private equity. “I also refuse to invest in companies at 100 times or 200 times or 500 times revenue. That game will end badly,” he predicted.
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