Top 4 Curated Venture Capital Weekly Update for Dec 21, 2022 💰
🗒️ Top VC Firms Investing in Artificial Intelligence (AI) Companies
Marktechpost: A look at the venture capitalists who are currently investing in AI (artificial intelligence) firms.
Although the idea of robots used to be somewhat unsettling, a lot of money is currently being invested in the architecture and systems that enable machines to learn and grow on their own without the assistance of humans.
According to PwC’s 2018 Moneytree Report, which was just released, $9.3 billion was invested in AI firms in 2017. This enormous number demonstrates the growing interest in technology and the growing understanding of its potential among public and commercial sector donors.
Artificial intelligence crosses all business areas, from self-driving vehicle AI operating systems to self-learning language processing platforms. Venture capital companies are hopping on the bandwagon to finance the minds behind the initiatives since they have the potential to disrupt so many industries, putting them ahead of the curve.
🗒️ Venture Capital for Virtual Reality Start-Ups
XR Today: If there’s one thing that any innovative start-up needs most to survive, it’s funding.
Virtual, augmented, and mixed reality (VR/AR/MR) technology are more accessible, with open code environments to explore and affordable hardware.
Currently, interoperable and open standards are increasing in awareness across immersive professionals. Moreover, interoperable VR/AR/MR solutions increase a company’s product value by allowing end-users to experience immersive offerings across numerous platforms.
Yet, companies still need access to the proper support to create something truly incredible.
The extended reality (XR) ecosystem is a significant part of the value chain for the XR world.
However, access to finance is still a considerable challenge for many European companies. Many innovators today have had to access creative forms of funding to make it into the market.
🗒️ Are megafunds killing venture capital?
Sifted: In the days of yore, $214m would have been a decent-sized venture capital fund.
US VC heavyweight Andreessen Horowitz’s first fund in 2009 was $300m, the first three Founders Fund vehicles by Peter Thiel oscillated between $200m and $250m, and even as recently as Q3 2022, the median US fund size was still barely $50m.
Yet $214m is how much Sequoia bet and lost in a single investment into the infamous crypto startup FTX. This single investment was as big as many of the earliest VC funds, and the Sequoia fund itself that backed FTX was more than $8bn in size.
Sequoia described FTX (in a now deleted article) as “a company that may very well end up creating the dominant all-in-one financial superapp of the future.” The gushing phrasing recalls what Softbank’s Masayoshi Son said about WeWork in 2017: “We are thrilled to support WeWork as they… unleash a new wave of productivity around the world.” Two years later, in 2019, the $100bn Vision Fund took a $4.6bn hit on that investment.
🗒️ The rules of VC are changing: Here’s what founders should be considering in the new era
Techcrunch: Over the last several years, VC money has been abundant and relatively cheap. This created an environment where everyone’s motto became, “growth at all costs.” Seemingly, the recipe for a successful venture-backed company became very cookie-cutter: Raise capital every 18 months; invest heavily in go-to-market; grow revenue at a “standard” rate that triples in year one, triples again in year two, and then doubles thereafter.
These “VCisms” borne out of an era of plenty have permeated boardrooms and investor meetings everywhere. In fact, the question, “How long do you expect the capital raised to last you?” essentially became a test of intelligence. The only right answer was 18 to 24 months, without any consideration of the specific circumstances of the company.