Sourcery → WWDC: Apple Intelligence?

(6/3-6/7) AI Masking The Downturn 🌈 Databricks/Tabular, Robinhood/Bitstamp, Ashby, Nium, Sixfold, Understory, ActuityMD, Eko Health, Storyblok, Twelve Labs, Cube, LiveKit, Tobiko Data, HyperSpectral

WWDC: Apple Intelligence vs Apple Stock?

Unfortunately, the long awaited Apple event disappointed some AI hype investors and technologists.. Compared to NVIDIA’s superstar Jensen, there was no Taylor Swift-like Blackwell announcement or celebrity-infused world tour.

Apple's stock dropped 1.9% down from $197/share on the day of their WWDC 2024 keynote.. To set the stage, high expectations had already been priced in, with shares rallying ~14% since hinting at AI plans in March ($169/share), wiggling to another dip in mid-April ($165/share). 

Analysts noted that the actual reveal did not live up to the expected ‘hype.’ There was a lack of major surprises. No super-humanoid robots, brain readers, Apple Vision Pro smell features, Scarlett Johansson collabs, AI specific chips or devices.. turns out they’ve had them all along.. While Apple unveiled "Apple Intelligence" with ChatGPT integration (bummer.. They needed OpenAI’s help to develop their own? Was this intentional to save some cash? Or is this temporary as they cook? Who knows, but OpenAI is continuing to dominate and now has access to ‘unlimited’ devices), the AI capabilities showcased, such as writing assistance, image generation, and Siri upgrades, were relatively straightforward.

There wasn't a major "wow" factor or game-changing new product revealed (though people loved the iPad calculator and iPhone screen mirroring). Additionally, some viewed Apple's AI rollout as more conservative compared to rivals like Google and OpenAI, with a focus on privacy and on-device processing rather than cloud AI capabilities (ok.. I don’t see how that is a bad thing at all.. but Elon musk does). All of this contributed to initial investor disappointment, leading to the 1.9% stock drop, which exceeded the 1.5% decline on the 2016 WWDC keynote day. The ‘unclear’ near-term revenue impact of AI also contributed to the muted investor reaction from the day. 

→ Check out all of the new WWDC releases here

→ Watch the WWDC 2024 Keynote in 18 Minutes

Zooming out..

They’re probably going to be okay 😂. Apple continues to be a ‘steady,’ massive company with 26.04% (2.2% YoY) in net profit margin on $90B in rev (-4.31% YoY) as of Mar.. so let’s see how this marinates over the coming days.

But compared to NVIDIA’s 57.14% (101% YoY) net profit margin on $26B rev (262% YoY!!) as of Apr, plus their large flashy AI contracts, (despite wildly high multiples at $3T market cap) NVIDIA will continue to satiate the market's appetite for high growth, profitability.. and well, excitement. 

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Musings

Macro

• Market map audit on VC-backed marketplaces.. supply & acquirers take a hit [Ali Afridi, Equal Ventures]

• The Consumer is Slowing Down [Animal Spirits]

• AI Is Masking the Downturn...FirstMark in the VC Directory...Emerging Managers Keep the Faith [Newcomer]

  • Dealflow is down (or normalizing?)

AI

• Reid Hoffman: The Future of TikTok and The Inflection AI Deal [20VC]

• SAP is incorporating Meta Llama 2 and 3 models into its generative AI hub, allowing customers to create dashboards with rich content. [SAP]

• Meta launched AI-powered features for Whatsapp Business aimed at developing click-to-Whatsapp ads and providing responses to customer messages. [TechCrunch]

• NVIDIA and leading global computer manufacturers introduced a new lineup of systems powered by the NVIDIA Blackwell architecture designed to help enterprises develop AI factories and data centers. [NVIDIA]

HardTech

• Industry leaders, such as BYD Electronics, Siemens, Teradyne Robotics, and Intrinsic are adopting NVIDIA's Isaac robotics platform to develop AI-powered autonomous machines for improved efficiency and safety in various sectors. [Nvidia]

• Saudi Arabia is positioning itself as a semiconductor hub with significant support from major industry players, such as Nvidia and Intel, as the country wants to attract 50 chipmaking firms to the country by 2030. [Quartz]

• At Computex 2024, AMD unveiled the Ryzen 9000 series CPUs based on the Zen 5 architecture and introduced AI PCs powered by the XDNA 2 NPU, alongside new chipsets and upcoming Instinct and EPYC products. [TechRepublic]

• Elon Musk's XAI is set to build the world's largest AI supercomputer in Memphis, TN, marking the city's largest capital investment by a new company, aimed at accelerating human scientific discovery, with the facility opening later this year pending state and local approvals. [Local 3 News]

• Hyundai Heavy Industries has launched new integrated ammonia scrubber technology designed to reduce emissions from ammonia-fueled ships to nearly zero and improve safety by detecting fine leakages in real time. [Ship Technology]

More

• Dopamine Addiction is Frying Your Brain [Darshan Somashekar]

  • Darshan, Founder of EasyBib (sold to Chegg for $60M) and now runs Solitaired.com, an online gaming company. He is very familiar with dopamine addiction given his field, he shares a 5-step playbook to regain control with science-backed support from none other than Dr. Andrew Huberman

  • Another good thread he wrote ‘Everyone thinks intelligence is genetic.. They’re all wrong”

• Dr. Jonathan Haidt: How Smartphones & Social Media Impact Mental Health & the Realistic Solutions [Andrew Huberman]

• Dr. Diego Bohórquez: The Science of Your Gut Sense & the Gut-Brain Axis [Andrew Huberman]

PS New episode with Hunter Walk coming out Friday!

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Last Week (6/3-6/7):

Relevant deals include the 80+ deals across stages below. 

I've categorized the deals below into eight categories, Fintech, Care, Enterprise / Consumer, HardTech, Sustainability, Acquisition/PE, and Fund Announcements, and ordered from later-stage rounds to early-stage rounds.

Highlighted VC Deals include: 

Ashby, Nium, Sixfold, Understory, ActuityMD, Eko Health, Storyblok, Twelve Labs, Cube, LiveKit, Tobiko Data, Odyssey, HyperSpectral, Cartwheel, Hoop, Xcimer Energy, Reibus International, WindBorne Systems

Acquisitions & PE

Databricks/Tabular, Authentic Brands/Champion, Robinhood/Bitstamp

Funds

Acquiline, WndrCo., Clean Energy Ventures, Sound Growth Partners

Final Numbers

Americans didn't let inflation spoil their appetite; Trend on American’s tipping habit

New Research

Geometric Approach To Asset Allocation With Investor Views; Ensembling Portfolio Strategies for Long-Term Investments: A Distribution-Free Preference Framework for Decision-Making and Algorithms; Adaptive Sampling of k-space in Magnetic Resonance for Rapid Pathology Prediction

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VC Deals 

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Fintech:

- Nium, a San Francisco, California- and Singapore-based real-time cross-border payments company, received $50M in a Series E funding round, led by a sovereign wealth fund in Southeast Asia and joined by BOND, NewView Capital, and Tribe Capital.

- Sixfold, an NYC-based company empowering underwriters with a generative AI solution for end-to-end risk analysis, closed a $15M Series A funding round, led by Salesforce Ventures, with support from Scale Venture Partners, Bessemer Venture Partners, and Crystal Venture Partners.

- Understory, a Madison, WI-based insurance platform for climate-vulnerable industries, raised $15M in Series A funding, led by True Ventures and Prelude Ventures.

- Fizz, an NYC-based credit-building debit card provider for students, secured $14.4M in Seed funding, led by Kleiner Perkins.

- Torpago, a San Mateo, CA-based commercial credit card and spend management platform, raised $10M in Series B funding, led by Priority Tech Ventures and EJF Ventures, alongside other investors, including BankTech Ventures.

- Mint Blockchain, a Los Angeles, CA-based provider of an Ethereum L2 network for the NFT industry, secured $5M in Seed funding from Jsquare, SNZ Capital, Antalpha Ventures, Mask Network, BlockAI Ventures, Predator Capital, GoPlus, Whitelist Ventures, PANONY Group, and other individual investors.

- Prósperos, a Los Altos, CA-based technology company that delivers a financial platform for the Spanish-speaking Western hemisphere, raised $3M in Seed funding from FEBE Ventures, BAT VC, Tekton Ventures, Courtyard Ventures, and technology executives.

Care:

- ActuityMD, a Boston, MA-based technology partner to the commercial MedTech industry, secured $45M in Series B funding, led by ICONIQ Growth and supported by Atreides Management, Stepstone Group, Redpoint Ventures, Benchmark Capital, and Artisanal Ventures.

- Eko Health, a SanFrancisco, CA-based AI diagnostic health company for the early detection of heart and lung diseases, secured $41M in Series D funding from ARTIS Ventures, Highland Capital Partners, NTTVC, Questa Capital, Double Point Ventures, EDBI, and LG Technology Ventures.

- Eyebot, a Boston, MA-based developer of rapid point-of-sale eye prescription technologies, closed $6M in Seed funding, led by AlleyCorp and Ubiquity Ventures, with support from Humba Ventures, Ravelin, Spacecadet, Baukunst, and Village Global.

- Sware, a Boston, MA-based software validation solution company for innovative life sciences companies, completed a $6M Series B funding round, led by First Analysis, with support from LRVHealth, New Stack Ventures, and Insight Partners.

- Keragon, a Boston, MA-based AI-powered HIPAA-compliant automation platform for healthcare, received $3M in funding, led by Focal and Afore, with participation from 25madison and Lifepoint Health.

- Nucleus RadioPharma, a Rochester, MN-based full-service CDMO provider for radiopharmaceuticals, secured an undisclosed amount in Series A extension funding, led by AstraZeneca, GE Healthcare, Mayo Clinic, Eclipse Ventures, Fox Chase Cancer Center, Echo Global Granger Management Mercy Health, and the University of Missouri.

- BranchLab, an NYC-based data science company for healthcare brands, secured an undisclosed amount in Seed funding, led by Newark Venture Partners, with support from Aperiam.

Enterprise/Consumer:

- Storyblok, an NYC-based modern content management system (CMS) provider for teams, secured $80M in Series C funding, led by Brighton Park Capital and joined by HV Capital, Mubadala Capital, 3VC, and Firstminute Capital.

- Twelve Labs, a San Francisco, CA-based video understanding company, closed a $50M Series A funding round, led by New Enterprise Associates (NEA) and NVentures, with participation from Index Ventures, Radical Ventures, WndrCo, and Korea Investment Partners.

- SpyCloud, an Austin, TX-based cybersecurity firm, secured a $35M growth financing from CIBC Innovation Banking.

- Ashby, a San Francisco, CA-based provider of a recruiting platform, closed a $30M Series C funding round, led by Lachy Groom and supported by Elad Gil, F-Prime, Y Combinator, and existing customers.

- Cube, a San Francisco, CA-based universal semantic layer provider for data apps, secured $25M in funding, led by Databricks Ventures and joined by Decibel, Bain Capital Ventures, Eniac Ventures, and 645 Ventures.

- LiveKit, a San Jose, CA-based platform provider for building and scaling voice applications, completed a $22M Series A funding round, led by Altimeter Capital, alongside Redpoint Ventures, Jeff Dean, Elad Gil, Aravind Srinivas, Ahmad Masad, and Guillermo Rauch.

- Tobiko Data, a San Mateo, CA-based data infrastructure platform, completed a $21.8M funding round, co-led by Unusual Ventures and Theory Ventures, with support from 20Sales, Fivetran CEO George Fraser, Census CEO Boris Jabes, and MotherDuck CEO Jordan Tigani.

- Indico Data, a Boston, MA-based solution provider for automating critical intake workflows across the policy lifecycle, closed a $19M funding round, led by .406 ventures, with participation from Guidewire, Sandbox Industries, Osage Venture Partners, and Jump Capital.

- Workbox, a Chicago, IL-based national workspace operator, secured $17.5M in Series A funding, led by Chicago Atlantic.

- Vantage Discovery, an Austin, TX-based AI-powered search and content discovery platform for ecommerce, received $16M in Series A funding, led by Lobby Capital and joined by The Hive, Future Positive, Common Metal, Jony Ive, Evan Sharp, and Biz Stone.

- Forward, an Austin, TX-based payment monetization technology partner for SaaS companies, closed $16M in Seed funding, led by Commerce Ventures, Elefund, and Fiserv.

- Stacklet, an Arlington, VA-based cloud governance and optimization as a code company, received $14.5M in Series B funding, led by SineWave Ventures, with support from Strait Capital, Uncorrelated Ventures, Capital One Ventures, Foundation Capital, and Relentless VC.

- Whizz, an NYC-based e-bike subscription/rental platform for last-mile delivery drivers, secured a $12M Series A funding round, led by LETA Capital alongside Flashpoint and others.

- Tektonic AI, a Seattle, WA-based enterprise GenAI agents developer, completed a $10M funding round, led by Madrona and Point72 Ventures.

- Odyssey, a New York-based edtech startup, secured $10M in Series A funding, led by Tusk Venture Partners and supported by Andreessen Horowitz, Cubit Capital, and Bling Capital.

- HyperSpectral, an Alexandria, VA-based AI-powered spectral intelligence company, closed $8.5M in Series A funding, led by RRE Ventures and Kibo Ventures, with support from Correlation Ventures and GC&H Investments.

- Testsigma, a San Francisco, CA-based provider of an AI-powered, low-code test automation platform, secured $8.2M in funding, led by MassMutual Ventures, alongside Accel, STRIVE, and BoldCap.

- Rising Team, a Menlo Park, CA-based team performance platform, raised $8M in Series A funding, led by Zeal Capital Partners, with support from Peterson Ventures, Roble Ventures, Female Founders Fund, Burst Capital, and Supernode Ventures.

- Inventive, a San Francisco, CA-based startup building embedded AI for SaaS products, closed $6.5M in Seed funding, led by Wing VC, alongside Tokyo Black and other angel investors.

- Cartwheel, an NYC-based generative automation platform, received $5.6M in Seed funding, led by Accel, with support from Khosla Ventures, Human Ventures, Heretic VC, MVP Ventures, Correlation Ventures, Pelion VC, Drew Houston, Akshay Kothari, Amjad Masad, and Kyle Parrish. 

- Liminal, a Denver, CO-based generative AI data security company, received an additional $5M in funding, led by Fin Capital alongside High Alpha, Matchstick Ventures, Craft Ventures Scout Fund, and others.

- Hoop, a NYC-based AI-powered task management platform, closed $5M in Seed funding, led by Index Ventures, with support from Origin Ventures, Divergent Capital, Chingona Ventures, Wade Foster, Job van der Voort, Andy Dunn, Annie Duke, Maria Katris, Maggie Adhami-Boynton, Jay Simons, and Sean Harper.

- AirMDR, a Menlo Park, CA-based AI-powered Autonomous Managed Detection and Response (MDR) company, secured $5M in funding, led by Foundation Capital and supported by Storm Ventures.

- OneScreen.ai, a Boston, MA-based matching ad placements platform, completed a $4.7M funding round from Asymmetric Capital Partners, Techstars, and Impellent Ventures.

- Flam, a San Francisco, CA-based premier AI-driven mixed reality (MR) publishing platform, secured $4.5M in Pre-Series A funding, led by Turbostart, Twin Ventures, and Alphatron Capital, and supported by Inventus Capital Partners, SVQ, 9Unicorns, angel investors, and family offices.

- Doowii, a Denver, CO-based AI-driven data analytics solutions provider for educators, closed $4.1M in funding from GSV Ventures, Better Ventures, Avesta Fund, Imagine Learning Ventures, Strada Education Foundation, Reach Capital, and Common Sense Growth Fund.

- Greptile, a San Francisco, California-based AI platform for searching indexing and searching large codebases with natural language, completed a $4.1M seed funding round, led by Initialized Capital, alongside Rich Aberman (WePay) and JJ Fliegelman (WayUp).

- Bem, a San Francisco, CA-based AI data interface company, secured a $3.7M Seed funding round, led by Uncork Capital, alongside Kevin Mahaffey, Roar Ventures, and Garry Tan.

- Wevr, a Los Angeles, CA-based creative development and production studio, raised $3.5M in funding from HTC Corp. and Epic Games.

- Field Materials, a San Jose, CA-based provider of AI software to control and verify construction material and equipment spending, secured an additional $3.5M, bringing the total seed funding raised to $8.5M, led by DivcoWest Ventures, Navitas Capital, Zelda Ventures, and Flyer One Ventures, with participation from Blumberg Capital, s16vc, Zacua Ventures, and industry executives.

- Thoughtly, an NYC-based AI voice agents startup for contact centers, secured $3M in Seed funding from Afore Capital, Greycroft, Expansion, and others.

- Caju AI, a Charlottesville, VA-based provider of generative AI-powered solutions for customer engagement, received $3M in Seed funding from Grotech Ventures, Felton Group, the family office of Charlottesville, Jaffray Woodriff, and other angel investors.

- Vurvey, a Cincinnati, OH-based provider of an AI platform for brands, received $2M in funding, led by Tindall Capital.

- 11thEstate, an NYC-based provider of a platform for investors to receive entitlements from securities class action settlements and shareholder compensations, completed a $2M Seed funding round from Social Leverage.

- CaseMark AI, a Portland, OR-based legal generative AI workflows company, closed a $1.7M Seed funding, led by Gradient Ventures, with support from Rex Salisbury’s Cambrian, Ride Home AI Fund, and Alumni Ventures.

- Phonely, a San Francisco, CA-based AI-driven phone support startup, raised $500K in funding from Y Combinator.

- Claroty, an NYC-based cyber-physical systems (CPS) protection company, received further growth funding of an undisclosed amount from Princeville Capital, Bosch Ventures, Chevron Technology, Delta-v Capital, AB Private Credit Investors at AllianceBernstein, Standard Investments, Toshiba Digital Solutions, SE Ventures, Rockwell Automation, and Silicon Valley Bank.

- The Desire Company, a Chicago, IL-based expert product education company, raised an undisclosed amount in Series B funding, raising its valuation to $97M, led by Cleveland Avenue, with support from Valor Siren Ventures.

- Chronus, a Seattle, WA-based employee-driven development platform, acquired Imperative, a Seattle, WA-based employee engagement platform, for an undisclosed amount.

- Nexus Cognitive, an Atlanta, GA-based enterprise Data & AI foundations company, received an undisclosed investment from Insight Partners.

HardTech:

- Xcimer Energy, a Denver, CO-based inertial fusion company, completed a $100M Series A funding round, led by Hedosophia, with support from Breakthrough Energy Ventures, Lowercarbon Capital, Prelude Ventures, Emerson Collective, Gigascale Capital, and Starlight Ventures.

- Frore Systems, a San Jose, CA-based thermal technology company, completed an $80M Series C funding round, led by Fidelity Management & Research Company and supported by Prosperity7 Ventures, Mayfield Fund, Clear Ventures, Addition, Qualcomm Ventures, MVP Ventures, Stepstone Group, Alumni Ventures, and others.

- Reibus International, an Atlanta, GA-based independent metals marketplace, raised $30M in funding from Canaan and Nosara, with HSBC as its banking partner.

- WindBorne Systems, a Palo Alto, CA-based provider of atmospheric sensing systems and AI weather models, closed $15M in Series A funding, led by Khosla Ventures, with support from Footwork VC, Pear VC, and Convective Capital.

- SiTration, a Boston, MA-based materials recovery company, secured $11.8M in Seed funding, led by 2150, alongside BHP Ventures, Extantia, Orion Industrial Ventures, Azolla Ventures, and MIT-affiliated E14 Fund.

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Acquisitions & PE:

- Databricks, a San Francisco, CA-based data and AI company, acquired Tabular, a San Jose, California-based data management company, for an undisclosed amount.Mus

- Authentic Brands Group, backed by CVC Capital Partners and HPS Investment Partners, is set to acquire Champion, a Winston-Salem, NC-based athletic wear brand, from Hanesbrands (NYSE: HBI) for approximately $1.5B.

- Robinhood, a Menlo Park, CA-based financial services company, is set to acquire Bitstamp Ltd., a global cryptocurrency exchange platform, for approximately $200M in cash.

- Frontdoor (NASDAQ: FTDR) is set to acquire 2-10 Home Buyers Warranty, a Denver, CO-based provider of new home structural warranty protection plans, from Genstar Capital for $585M in cash.

- Dolby Laboratories (NYSE: DLB) is set to acquire GE Licensing, a Boston, MA-based intellectual property business in the digital media and electronics sectors, for $429M in cash.

- Ambac Financial Group (NYSE:AMBC) is set to acquire a 60% controlling stake in Beat Capital Partners Limited, a London, UK-based venture capital investor in the insurance industry, from Bain Capital and Beat’s management team.

- My Yield, an Oelwein, IA-based specialty seed treatment provider, secured an undisclosed majority recapitalization as its third investment from Inverness Graham Green Light Fund.

- Tenable, a Columbia, MD-based exposure management company, acquired Eureka Security, a Tel Aviv, Israel-based provider of data security posture management (DSPM) for cloud environments, for an undisclosed amount.

- Solarity, a St. Louis, MO-based automated clinical data processing solution company for acute and ambulatory healthcare providers, secured an undisclosed strategic growth investment from TA Associates.

- PostPilot, a Greenville, SC-based direct-mail marketing company, secured an undisclosed strategic investment from Summit Partners, alongside Andrew Bialecki and Ed Hallen.

- Fixle, a Union, KY-based home management solutions company, acquired EasyHome, a developer of software solutions designed to modernize property care and management for homeowners, for an undisclosed amount.

- Deloitte acquired all of the assets of End Point’s disease surveillance company, CasePointer, for an undisclosed amount.

- Brandt Information Services, a Tallahassee, FL-based provider of outdoor recreational technology platforms, secured an undisclosed investment from Providence Equity Partners.

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Fund Announcements:

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- Aquiline Capital Partners LP, an NYC- and  London, UK-based private investment firm focused on financial services and related technologies, closed approximately $3.4B of funds from financial institutions, sovereign wealth funds, public pension funds, funds of funds, and family offices.

- Yukon Partners, a Minneapolis, Boston, and West Palm Beach-based private equity firm, raised $765.2M for its Yukon Capital Partners V, L.P., and associated parallel funds from domestic and international pension funds, international banking conglomerates, insurance companies, endowments, foundations, consultants, and family offices.

- Creandum, a Stockholm, Sweden-based venture capital firm, raised €500M ($542M) for its seventh fund focused on technology companies.

- WndrCo, a Redwood City, CA-based venture capital firm, closed $460M for its seed and venture funds focused on companies in the future of work, consumer technology, cybersecurity, and developer infrastructure industries.

- Clean Energy Ventures, a Boston, Mass. and London, U.K.-based venture capital firm, raised $305M for its second fund focused on climate technology companies.

- Sound Growth Partners, a Seattle, WA-based private equity firm, closed its Fund I, at $275M in capital commitments.

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Final Numbers

Data: US Census Bureau; Chart: Statista

• Despite inflation causing financial headaches for many U.S. households, Americans continue to dine out, with restaurant industry sales expected to exceed $1.1 trillion this year and employment in the sector reaching over 15 million by year's end. [Statista]

  • The U.S. Census Bureau's data supports this trend, showing food services and drinking places generated $93.9 billion in sales in April 2024, a 5.5% increase from the previous year, with sales growth outpacing price increases, indicating robust consumer demand and industry resilience. [Statista]

Data: Pew Research Center; Chart: Statista

• Americans are feeling increased financial strain from "tipflation," where tipping expectations have risen both in amount and frequency, even in situations where tipping was uncommon a few years ago. [Statista]

  • A Pew Research Center survey of nearly 12,000 U.S. adults revealed that 72% believe tipping is expected in more places than five years ago, with 29% viewing it as an obligation rather than a choice, and 26% finding it difficult to determine when to tip, a confusion that rises to 35% and 40% among those with higher education levels. [Statista]

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New Research

A Geometric Approach To Asset Allocation With Investor Views

• This research introduces a geometric approach using the generalized Wasserstein barycenter (GWB) to integrate investor views into portfolio construction, enhancing the estimation of asset drifts and covariances. Compared to the conventional Black-Litterman model, this method offers more flexibility in expressing confidence in views and greater rewards for accurate decisions. [arXiv]

• The approach is supported by both empirical and theoretical evidence, indicating its potential for improved portfolio optimization. [arXiv]

Ensembling Portfolio Strategies for Long-Term Investments: A Distribution-Free Preference Framework for Decision-Making and Algorithms

• This paper introduces a novel framework for combining multiple sequential portfolio strategies to enhance long-term wealth, addressing the challenge of uncertain future performance and the lack of a consistent preference framework.