VNTR Capital News Nov 5, 2023 – News, Events, VC Reads
Venture Capital, Web3, and Private Equity – Nov 5 News, Events, and VC Reads
Hello friends,
Happy Sunday!
VNTR Capital Newsletter is delivered to 50k+ investors weekly to share the latest news, events, and articles from the global VC and startup ecosystem.
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Scroll down for VNTR Capital Community News, Upcoming Events, and VC News/Reads.
VNTR CAPITAL COMMUNITY NEWS
Spotlight
SignalRank — We hosted Keith Tear and Kayvan Baroumand, Co-Founders at SignalRank, this week to share how SignalRank works and invests. SignalRank leverages AI to predict the outcomes for venture-backed companies. It invests in the highest-scoring Series B rounds via partnerships with Seed investors, supplying capital for their pro-rata rights. You can learn more about SignalRank and watch the recording on the VNTR Platform.
VNTR GP LP Summit — We're excited to announce that we are gearing up to host our inaugural VNTR GP LP Summit in Spring 2024. The Summit will bring together General Partners (GPs) and Limited Partners (LPs) from our global community, providing a unique platform for insightful sessions, fostering connections, and catalyzing relationships to effectively deploy capital into VC Funds in the VNTR community. The Summit will be an integral part of our VNTR GP and VNTR LP subscription services, offered annually, to facilitate seamless interactions between GPs and LPs. Join the VNTR Platform to create your GP or LP accounts.
Corporate Sponsorship — We are looking to partner with corporations interested in leveraging VNTR events, newsletters, and the VNTR platform to connect with investors and premium clientele in 2024. Apply or reply to discuss annual packages.
Join us at upcoming Flagship VNTR Events:
We are recruiting Chapter Directors in Riyadh, Berlin, and Los Angeles to grow the VNTR Capital community. Chapter Directors will serve as super connectors to the global Venture Capital community. Interested candidates can apply here.
Past Week
Hong Kong — We hosted our 2nd Hong Kong VNTR Roundtable and marked the official launch of our Hong Kong Chapter operations. Moving forward, we are excited to organize a series of recurring events designed to foster connections within the Venture Capital ecosystem and act as a vital gateway to the region. (View Photos)
London — The London Chapter convened for an Investor's Dinner on October 31st, delving into the exciting landscape of FinTech investments in the UK. Attending VNTR PRO members (Victor Baron and Pavel Hilman).
Upcoming
VNTR PRO Masterminds — We will host 3 Bi-Weekly VNTR PRO members masterminds on Nov 7, 8 and 9. Learn more about VNTR PRO services.
Melbourne — We are hosting our first VNTR Investors Roundtable in Australia on Nov 12, a side event to the Australian Crypto Convention. VNTR PRO members get free passes, 50% off with VNTR50.
Lisbon — Join us next week at Portugal Tech Week, where we will host VNTR Investors Roundtable Lisbon on Nov 14. More than 100 events and conferences will take place in Portugal on the week of Nov 13-19!
Singapore — VNTR Singapore Chapter will host the VNTR Roundtable Singapore on Nov 16 to connect investors visiting the Singapore FinTech Festival. Investors can join Investor Hours powered by Carta on Nov 15, 16 and 17 and get complimentary passes to the Singapore FinTech Festival. Learn more about Carta Investor Hours.
Thank you to our Partners:
Cuatrecasas is an international law firm firmly established in Spain, Portugal and Latin America, where it has offices in Chile, Colombia, Mexico and Peru. With a multidisciplinary and diverse team of over 1,600 professionals from 24 nationalities, we cover all areas of business law with a sectoral approach, focusing on all types of business. Cuatrecasas has 27 offices in 13 countries and collaborates closely with leading law firms in other countries to offer a team to meet every client's needs in every scenario.
Liquid Crypto is leading the way for the next generation of DeFi. Users can effortlessly complete all of their transactions within one platform with confidence, knowing they will always be offered the lowest possible rate in the market. Liquid Crypto’s AI enables projects, traders, and investors to effortlessly realize outsized returns in an omnichain reality by bridging the gap between CeFi, DeFi, Money Managers and Market Makers. You can contact Choua Lee to learn more.
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VNTR Capital Events:
Nov 29 VNTR Investors Roundtable Abu Dhabi (Abu Dhabi Finance Week side event)
Dec 1 VNTR Investors Roundtable Helsinki (SLUSH side event)
Dec 5 VNTR Investors Roundtable Berlin (Next Block Expo side event)
Dec 7 VNTR Investors Roundtable Bangalore (India Blockchain Week side event)
Dec 10 VNTR Investors Roundtable Miami (Art Basel Miami side event)
Jan 17 Venture Capital Investors Roundtable Davos (World Economic Forum 2024 side event)
RSVP to Upcoming VNTR Capital Events
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UPCOMING VC EVENTS
Nov 7-10 Nearcon, Lisbon, Portugal (Free passes with VNTR)
Nov 8-9 Wolves Summit, Vienna, Austria
Nov 8-9 Reuters Next, New York, USA
Nov 10-11 The Gateway, Dubai, UAE
Nov 11-12 Australian Crypto Convention, Melbourne, Australia (VNTR PRO members get free passes, 50% off with VNTR50)
Nov 12 Girls Into VC 2023 Summit, Cambridge, Massachusetts, USA
Nov 12-22 Portugal Tech Week, Lisbon, Portugal
Nov 13 Europas, Lisbon, Portugal
Nov 13-17 AIBC Europe, Malta
Nov 14-16 SALT iConnections Asia, Singapore
Nov 15-17 SFF2023 Investor Hours, Singapore
Nov 15-17 Singapore Fintech Festival, Singapore
Nov 17-19 Longevity Conference, Ark, Liberland
Nov 22 SouthEast Asia Institutional Investor Forum, Singapore
Nov 27-30 Abu Dhabi Finance Week, UAE
Nov 30-Dec 1 SLUSH, Helsinki, Finland
Nov 30-Dec 1 TechEx Global, London, UK
Dec 4-5 Next Block Expo, Berlin, Germany
Dec 4-8 West Tech Fest, Perth, Australia
Dec 6-7 FinTech Connect, London, UK
Dec 8-10 Art Basel, Miami, USA
Dec 11-12 Global Blockchain Congress, Dubai, UAE
Dec 12-13 New England Venture Summit, Boston Dedham, MA, USA
Dec 21-22 Web3 Beyond Borders, Tokyo, Japan
Jan 15-19 World Economic Forum Annual Meeting, Davos, Switzerland
If you would like to submit VC-related events, please respond to this email or Telegram @byuric
Follow us on Social media: Instagram, LinkedIn, Facebook, Flickr, and Twitter.
Check out VNTR Capital upcoming events
VC Reads
View curated VC news and articles on the VNTR Platform
How-to guide: Raising your first VC fund
VC fundraising is only getting more challenging during this market downturn, but it's the first-time managers facing the biggest hurdles. So, what's a new GP to do? In the first nine months of 2023, only 81 debut VC vehicles closed, worth $6.1 billion in total, according to the Q3 2023 PitchBook-NVCA Venture Monitor, compared to 292 funds and $10.3 billion in 2022. Increasingly, capital has been flowing into larger, more established venture funds, underscoring the appeal of investors with long-term track records. "The market dynamics over the last couple of years have changed the appetite of a lot of folks when it comes to VC," said Jeff Herbst, managing partner of GFT Ventures, which raised $140 million for its debut vehicle earlier this year. "But I personally think that now is the best time to be launching a VC fund. But it's not an easy thing to do, especially at the moment."
Sam Bankman-Fried is found guilty of all charges in FTX's spectacular collapse
Sam Bankman-Fried, the former head of the cryptocurrency exchange FTX, was found guilty of each of the seven criminal charges he faced, marking a spectacular fall from grace for a "math nerd" who was once a shining star in finance.
Bankman-Fried now faces the prospect of spending decades in prison after being convicted on charges including securities fraud, wire fraud and money laundering. The jury reached its verdict after just five hours of deliberations.
Maybe you shouldn't start a fund
There are many good reasons to start a fund. It can be very lucrative, provide tremendous autonomy, fund the growth of a team, set the beginnings of a long-term franchise, and more. But it’s a big responsibility and may not be the right direction for everyone.
In this post we’ll cover options to consider before starting a fund, pros/cons of different investing approaches, questions to consider when deciding if a fund is right for you, and how other fund managers navigated this decision.
From 0 to 1: How to Build a Winning Web3 Product with Ryan Jones
Watch the new episode of "Web2+1 with VC" with Ryan Jones from Consensys to learn about every aspect of product development in Web3 and ultimately how to build a winning Web3 product.
The Week’s 10 Biggest Funding Rounds: Next Insurance, MapLight Therapeutics Hit It Big
From an aerospace and defense startup to a company making the next-generation of motors, this was a strong week for big rounds. Five startups raised nine-figure rounds and another fell just $1 million short. With the holidays looming and a slowdown surely coming, there may not be many more weeks like this left this year.
Biden’s AI Order May Have Wide Impact For Startups
The Biden administration on Monday released an executive order laying out a broad range of safety and security requirements around the use of artificial intelligence technology. The standards, which range from setting requirements for red-team testing to affixing labels on AI-generated content, could have a wide impact on how AI-focused companies, and startups in particular, develop and release new iterations of their products. Below, we look at some of the standout components of the executive order, with an eye to how startups might be impacted.
2023 Founder-Friendly Investors
Introducing the Investment Firms With a Track Record of Backing Entrepreneurs
Business owners often turn to investment partners to accelerate growth. The PE, VC, and debt firms on our list have a proven track record of helping founders outgrow the competition.
Founders - use this Q3 data to guide your negotiations with investors.
Quick spin through valuations and cash raised and then we'll tackle the top 5 things to know from US startups in Q3.
Understanding Investor Psychology
Reflecting on my time as a VC, I acknowledge the significant role of instinct in decision-making. This was true not only for my personal decisions but also in discussions and decisions with my colleague’s investments.
As an investor, you meet hundreds of founders each year, but only a few will evoke a certain "feeling." This feeling is what makes you want to invest or not, so as an investor you are chasing that feeling constantly.
Understanding this aspect of investor psychology is crucial to successfully fundraising for your startup. This insight can transform your approach to fundraising, allowing you to persuade investors to support your business.
The U.S. economy shrugged off the tech bust
The U.S. economy is doing GREAT right now. Real U.S. GDP growth came in at a 4.9% annual rate in the third quarter, which is as fast as China’s official growth rate, and is unusually fast for the U.S. The unemployment rate continues to hover near record lows at 3.8%, while the prime-age employment rate is near record highs at almost 81%. Inflation has come way down and is now around 3.7%, with core inflation a bit lower, and median wage growth is outpacing inflation. Meanwhile, new survey data shows that Americans have gotten wealthier, and wealth inequality has narrowed.
Surviving The Death of Venture Capital
I've said it before, and I'll say it again. In 2008 one of the most important experiences in my life was making sure I argued with all of my friends about which movie was better; The Dark Knight? Or Iron Man? Meanwhile the world was experiencing one of the five worst financial crises in history that led to a $2 trillion loss globally.
But when I think back, I still think The Dark Knight was a better movie. One scene in particular I was thinking about recently. There are two boats. One is filled with convicts, one is filled with regular people. The boats are stopped, and each are told they have a detonator to a bomb strapped to the other boat.
Canada Is Moving Up The Cleantech Ranks
When it comes to cleantech investment, famously cold Canada might seem like an unlikely hot spot. Recent funding trends, however, indicate its star is on the rise. So far this year, nearly a billion dollars (US$) in seed through growth-stage funding has gone to Canadian startups in sustainability-focused industries tracked in the Crunchbase dataset. Standout sectors include carbon capture, geothermal energy and utility-scale solar. With two months still left, 2023 is on track to top last year’s record-setting totals. For a sense of how investment is trending, below we charted out sustainability-focused Canadian startup investment for the past six calendar years.
How To Hire While Avoiding Future Layoffs
Tech layoffs are on the rise once again. Yet at the same time, some companies like Salesforce (which laid off 10% of its team earlier this year) are announcing massive hiring sprees. As an executive coach for more than 20 years, I’ve had to advise business leaders at startups like Venmo, Etsy and The Wirecutter about laying off staff, hiring (sustainably) and navigating downturns. Because startups move so fast, they often lack structure and process. But to hire well — and avoid rapidly reversing course — you have to hire with restraint and foresight.
Abu Dhabi pioneers DLT regulation for DAOs, Web3 innovations
Abu Dhabi, the second-most populous emirate in the United Arab Emirates, has introduced a formal regulatory framework for decentralized autonomous organizations (DAOs) and other digital ledger entities as it doubles down on its ambition to be a leader in digital asset innovation within the Middle East. The new framework allows DAOs to operate legally and issue tokens to members, providing regulatory clarity for digital asset firms. Abu Dhabi is aiming to become a crypto hub alongside Dubai, and this move is part of a larger initiative to foster initiatives in the broader blockchain and digital asset realm.
A Friendly Reminder to Cost-Cutters: Keep the Company a Great Place to Work for Survivors
It’s been a tough year. We’re currently in peak planning season for 2024. With capital scarce and expensive, with companies increasingly trapped in Schrödinger’s startup paradox, and with more startups than ever focused on positive cashflow and The Rule of 40, it’s safe to say that Silicon Valley is still very much in a cost-cutting mood.
I’ve done a lot of cost cutting over the course of my career so I thought I’d share one key rule that sometimes gets overlooked when you’re in the thick of this process. Here’s the rule: no matter what you do, no matter how deep the cuts have to be, keep the company a great place to work for those who still work there (aka, the survivors).
Help or hindrance: Is Web3 really improving mainstream industry and products?
Web3 has been gaining ground in mainstream industries with the rise of Web3 business models based around nonfungible tokens (NFTs), blockchain technology and crypto. But it’s still an open question whether it’s actually improving mainstream industry and products. According to a June Coinbase study, over half of the top 100 United States companies listed in the Fortune 500 have pursued Web3 initiatives since the start of 2020. Around 60% have either been in the pre-launch stage or already launched since the start of 2020. Out of the surveyed Fortune 500 executives who are familiar with blockchain, 83% say their companies have either current initiatives or are planning them. Speaking to Cointelegraph, Pat White, co-founder and CEO of digital asset platform Bitwave, believes there has been progress in successfully marrying Web3 with the mainstream.
Autonomous Vehicle Funding Stuck In Neutral
Last week, Cruise announced it will suspend its self-driving taxi program across the country after losing its permit to operate in San Francisco due to an incident with a pedestrian. The announcement came almost exactly a year after another autonomous vehicle startup — Ford Motor-backed Argo AI — shuttered after raising $3.6 billion in funding from investors such as Ford Motor, Volkswagen Group and Lyft. The moves are another blow to a sector where venture dollars have slowly been decreasing. Thus far this year, autonomous driving startups have raised less than $4.5 billion — which puts the sector on pace for its lowest funding total since 2020, per Crunchbase data.
Eye On AI: Google Intent On Searching Out More AI Deals
It’s no secret big tech has gone wild investing in AI in the past year. From Microsoft’s massive $10 billion investment in OpenAI to Nvidia’s extending list of investments in the field, corporations have stuffed the coffers of AI startups. Google seems intent on slowly working its way up the list of big tech companies investing heavily in the next AI tools and models. Late last week, The Wall Street Journal reported that the search giant agreed to invest up to $2 billion in San Francisco-based Anthropic. The deal includes $500 million upfront plus an additional $1.5 billion more over time, according to the report. No valuation was reported. Google had previously invested in Anthropic, including a large $300 million round for the OpenAI competitor reported back in February.
Can specialized AI chip startups take on Nvidia?
Nvidia's semiconductors dominate the market for running the large language models that underlie generative AI programs. Now, a cohort of startups has emerged to take on the chip goliath. Makers of AI chips are going niche, designing tailored semiconductors for running specific models with less energy and lower costs. While it will be an uphill climb to take on Nvidia, investors think chips with specialized use cases could attract investment.
"The big gorilla in the room is Nvidia," said Lux Capital partner Grace Isford. "You could see growth by non-Nvidia players for specific specialized use cases."
Direct-to-consumer brands — a staple category for startup investors a couple years ago — have mostly disappeared from the ranks of funded companies today. So far this year, U.S. investors put just over $130 million into companies at the intersection of e-commerce and consumer products, per Crunchbase data. That’s a whopping 97% decline from the peak in 2021, when over $5 billion went to this investment theme. For a sense of how funding has trended over time, below we charted out investment and round counts for the past six calendar years.
Want Crypto Adoption? Give Consumers What They Really Want
The first step to solving a problem is admitting you have one. In crypto, our problem is the profound gap between what people say they want, and what they actually want. This phenomenon, called the “value action gap,” helps clarify why belief doesn’t always turn into action. In crypto, the mismatch is huge: despite strong theoretical sentiment for crypto’s underlying principles, adoption remains shy. But if Web3 is to reach even a fraction of its potential, we can’t ignore this gap any longer.
If PayPal's Stablecoin Is a Security, Anything Could Be
This marks the latest in a series of regulatory actions against the crypto industry taken by the securities regulator led by Chairman Gary Gensler. Notably, the SEC filed suit against the Binance-brand BUSD stablecoin issued by Paxos in March. PayPal’s stablecoin is also a product co-managed by Paxos. To many observers, this latest subpoena, which could but does not necessarily have to lead to an official lawsuit, reeks of the SEC “picking winners” in the emergent world of crypto. In a sub-sector dominated by crypto natives, PayPal was the first major fintech to launch a stablecoin, followed shortly after by VISA.
Hong Kong issues rules for asset tokenization as interest mounts
The Securities and Futures Commission (SFC) of Hong Kong has issued two circulars to regulate digital asset tokenization. The circulars offer instructions to intermediaries participating in tokenized securities activities and outline the criteria for tokenizing investment products authorized by the SFC. The SFC considers tokenized securities as traditional securities with a tokenization layer. As a result, the exact legal and regulatory requirements that apply to conventional securities markets also apply to tokenized securities.
Carbon and emissions startups set new record for VC funding
Climate-tech startups specializing in carbon and emissions tech raised $7.6 billion in VC funding in Q3, beating the sector's previous record by $1.8 billion and defying the fundraising slowdown. The hot quarter for climate-tech companies rode a wave of mega-rounds to finance factories that government incentives have made more economical. H2 Green Steel, a company using hydrogen from renewables to make steel, raised $1.6 billion, and battery recycler Redwood Materials closed a $997.2 million Series D, according to PitchBook's Q3 2023 Carbon & Emissions Tech Report.
US investors favor UK for overseas VC deals
The UK has claimed the largest share of US investors' foreign venture deals this year as the latter's participation in non-domestic deals dwindles. US investors have taken part in 3,418 VC rounds worth $50.2 billion outside of their domestic market this year, according to PitchBook data, a significant fall from last year's total of 7,337 deals. While national deals with US firms have also fallen in 2023 compared to last year, it has been to a lesser extent than their foreign participation.
The UK and US are setting up national AI safety institutes — what that means for startups
The most concrete result to come out of the UK’s highly anticipated AI summit was the announcement of plans for the UK and US to set up national AI safety institutes — to help AI startups prevent societal risks from the most advanced models. These organisations would help assess AI models and their potential to cause existential threats, but they could also mean that startups have to wait longer to get their hands on the most cutting-edge systems from big tech players. The fact that the US and the UK have chosen to work so closely on this issue is an important step in building public trust in AI, as startups try to convince consumers that runaway algorithms are not going to go Terminator on us (as some tabloids would have us believe).
The NFT Market Has Crashed. What Should Artists Do Now?
In the wake of the NFT market's multi-year downturn, many artists who once thrived are now navigating a challenging and uncertain landscape. The NFT market had experienced exponential growth in recent years before it stumbled, leaving artists to question whether digital artwork is still a viable avenue for success. However, amidst this uncertainty, there are opportunities for artists not only to endure but to thrive. As new technologies continue to emerge for the distribution of art, it is crucial for artists to focus on methods that enable them to promote and sell their work long-term, regardless of the state of any market.
3 things a city needs for a thriving startup scene
The Bay Area and New York have long dominated the global VC ecosystem, but in cities from Raleigh, N.C., to Istanbul, thriving tech communities are gaining more momentum. Dubai, where local startups raised $3.8 billion across 815 deals over the past five years, has a VC growth score of 72.8, according to PitchBook's analyst note ranking VC ecosystems. Following close behind with high growth scores are America's automotive industry capital Detroit, Germany's techiest city Berlin, and the academic hub surrounding Raleigh.
These 10 VCs lead the way in defense, aerospace tech
VC investors are playing a larger role in redefining the nature of warfare and aerospace as geopolitical tensions boil over. From 2016 to 2022, VC investment in the defense-tech sector grew rapidly, with $135.3 billion invested across 4,744 deals, according to PitchBook's 2023 Vertical Snapshot: Defense Tech. AI, autonomous weapons, satellites, reusable rockets and cyber warfare all are emerging with new technologies to render traditional measures of military might like firepower less relevant. Companies including SpaceX, Anduril and Palantir have demonstrated that tech startups can find success in an industry dominated by large incumbents.