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This is a transcript of latest episode of equity, TechCrunch’s venture capital-focused podcast. New episodes of Equity air every Monday, Wednesday and Friday.
Listen above or read below to watch our Wednesday show, in which we talk about the week’s major startup and venture capital news.
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0:10
Hello, and welcome back to Equity, the TechCrunch podcast where we uncover the nuances behind the figures and headlines. Today is February 14, 2024. Happy Valentine’s Day, I hope you eat some chocolate and relax on the couch because you deserve it.
This is our Wednesday show, where we look back at the important startup and venture capital stories of the week so far. Today on the pod, we’ve got a great list of things to do. I can’t wait to talk about it.
We’re going to start with Brett Taylor’s new startup Sierra, and why FlowFi wants to connect people and technology. Then we have venture capital rounds from Fold and Antithesis. And we’ll kick off our startup coverage by asking why everyone wants me to eat more mushrooms. In the enterprise corner, we have the latest news from homebrew, foundry, and Europe. let’s go!
1:00
To kick off our startup coverage, today I want to talk about someone who is best known for his work in Big Tech. That’s Brett Taylor. He is a former Google Maps friend, founded FriendFeed and then became CTO of Facebook. He then founded Quip and then became co-CEO of Salesforce. And he is a former board member at Twitter and currently on the board of OpenAI. And he’s creating a new company called Sierra.
So what’s Sierra doing? Well, it’s building Conversational AI Agent, essentially pieces of artificial intelligence that perform tasks for end users, such as asking questions or updating their account. The AI agent space is busy, but Sierra has already raised $110 million and brought a product to market. So it looks like with lots of capital, early customers, and maybe some early revenue, it’s making a game that is well-backed to dominate the growing software sector.
But it’s working in a more practical way than I expected. Its Creating Software Tools for Your Customers Instead of giving them a big bag of things to put together on their own.
The joke here is that if you want to raise money today, build an AI startup. but if you In fact Want to raise money today, okay, sit on the board of OpenAI and also create an AI startup. Fortune reports that Sierra is using both closed — aka OpenAI — and open source AI models to help avoid hallucinations and help its AI agents actually execute tasks for their customers. series together. Chained LLMs may become a trend.
2:36
walk together [to] Flowfy. I think it’s an absolutely fascinating startup. it just Raised $9 million from Bloomberg Capital, But the way it’s going after its market, startup financial management, has really surprised me.
So today there is a big emphasis on using AI to do what humans can do as often and as quickly as possible. The logic here is very simple. Computer agents are far cheaper than human laborers. From a business perspective, it makes sense to replace the latter with the former. However, Flowfy is building a software suite for startup finance that connects the marketplace with real humans who help their clients with their books. So it’s creating software plus humans instead of software with more AI.
And frankly, in this case, I get it. You don’t want your CFO to become a bot. You want someone who is savvy, experienced, and able to stare you down like the go-to CFO when you make a silly mistake, or spend too much money on your business trip dinner. So the company only provides accounting support, CFO like service and tax preparation assistance with the software And Man on top. very quiet. But let’s see how it grows.
3:47
And this week there were many, many, many more. I’ve had to narrow some things down, but I want to reach out to more companies. So let’s start with bold. it Just raised $50 million, and it is working on payments in Latin America. So this is a big fintech round in a region that was once completely underserved for fintech, and given the decline we’ve seen in venture in Latin America and in fintech in general, it feels bold to raise money for this project. Nice to see, where it is located. The bold is a welcome ray of light compared to many other Latin American fintech companies that are themselves hoping to raise more capital. And if you remember, on last Friday’s show we talked a lot about how Latin American startups More efficient by several key metrics Compared to other areas. So perhaps VCs here are seeing this and putting their checkbooks to work where it can have the most impact.
4:35
The next company is Antithesis. it Just raised $47 million For its automated software testing service. I chose it because I think it’s great. This is because everyone agrees that software is the future of the world. But actually writing code that is secure and stable is no easy task. You can compare it to writing and editing – you need both for a good final product. So, if I can put it this way, the antithesis is creating a set of tools to help code run very well. Obviously there’s a lot of competition, especially in the startup world. But I don’t think you will be able to achieve that much capital in today’s market if your numbers are not top notch. Counterpoint, worth watching.
5:20
And then to wrap up our startup coverage, why does everyone want me to eat mushrooms? This is getting really weird. This time, it’s a The startup is called SpaceGoods – All one word. It’s a London-based wellness brand that looks to use mushrooms and nootropics to create a range of powder blends. TechCrunch says it claims its product will boost my energy, relaxation, and mood. To which I can only say that yes. Other startups are using mushrooms to make artificial leather, protein-focused foods and energy drinks. Apparently mushrooms can do everything. And that means the people who wrote “The Expanse” were right. I think we should all be on the lookout for bottles of mushroom whiskey that will be on the way.
6:04
Moving from startup to venture capital, that’s our first VC story of the morning Homebrew is targeting $50 million for a new fund , , , According to the SEC filing. And this filing is actually a bit of a surprise since Homebrew said nearly two years ago that it was pursuing a more stage-agnostic, evergreen model that would be funded entirely by its partners Satya Patel and Hunter Wolk . So what does the news mean? I have some ideas. It may perhaps be an opportunity fund, or perhaps a very suitable vehicle for large follow-on investments in prior deals.
If Homebrew can self-fund, its previous funds have performed very well. So people may want to co-invest with it to some extent, even though its main funding will now be derived internally. Anyway, can you imagine LP meetings of a fund that is entirely supported by its own general partners? It would be like this “Hello and good morning.” How did we perform so well this quarter? Okay, the meeting has been adjourned.”
7:13
But if Homebrew is reloading, Foundry Group is moving away. Foundry is an 18-year-old venture capital firm with approximately $3.5 billion in assets under management. and this is Decided to shut down quietly and not raise any more money, The move surprised TechCrunch as the firm had announced a $500 million fund last year.
Over the years, Foundry has invested in more than 200 companies and 50 venture capital firms. And that’s according to its co-founder and partner Seth Levin. Among names you might know, Foundry has backed companies like Fitbit and Zynga. But in a post, Levin wrote that, and I quote, “While VC firms rarely make decisions like this, that’s exactly what we planned to do when we started Foundry in 2006. Since then, we had deliberately decided not to build a legacy or intergenerational firm.”
In a way it feels refreshing. Do something for a while, make a lot of money and then move on. This seems oddly neat, especially because of what we’ve seen at other venture capital firms. A major generational change or handover may go awry. But don’t worry, the foundry still has money to invest from its last fund. It is not going to make anyone else stand.
8:30
And to round us out, our own Anna Heim reports that Germany-based EarlyBird Health Put together the final closing of your second fundWhose price is going to be 173 million euros i.e. about 185 million dollars. This is actually more than double the size of EarlyBird’s first healthcare-focused fund, which was very creatively named Health One and was valued at around €85 million at its last close. So while both funds are similar in both thesis and stage, the larger, new fund will enable Earlybird to write bigger checks. Who doesn’t love a little more ownership? And because Earlybird intends to invest mostly in Europe, including the UK, its new fund could be good news for health tech startups in the region, many of which are running short of cash. The very public collapse of telehealth company Babylon,
9:23
And that’s our show for this blissful Wednesday morning. hugs to you. We hope you are doing well.
We’ll have more for you on Friday, but in the meantime, we’re “EquityPod” on X and Threads and we’re TechCrunchPod on TikTok.
In the meantime, I strongly recommend that you take a look at both of our sister shows. he is chain reaction More on Crypto Beat found Talking to the founders about how they built what they built. Ok. I’m Alex, I’ll talk to you soon. goodbye.
Equity is hosted by me, Alex Wilhelm, and TechCrunch senior reporter Mary Ann Azevedo. We are produced by Theresa Loconsolo with editing by Kel. Bryce Durbin is our illustrator and a big thank you to the Audience Development team and Henry Pickwet, who manages TechCrunch Audio products. Thank you very much for listening and we’ll talk to you next time.
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