iCloud News: What it takes to raise a seed round today

Monday, February 12, 2024

Good morning, and welcome to TechCrunch AM for February 12, 2024. Today, we're taking a look at a massive nine-figure venture capital round, a notable startup deal, a VC firm that is bringing its founders to Silicon Valley for AI meetings, and the latest chat bot hallucinations.

– Alex

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Nine-figures for bug bounties: The business of helping companies find bugs and other security issues with their software is big. The market's so large, in fact, that Bugcrowd just raised $102 million to help root out bugs at its customers, which include the likes of OpenAI. General Catalyst led the investment that will see Bugcrowd able to go on the offensive, including making acquisitions if it decides to.
Notion buys Skiff: Well-funded documents-and-notes startup Notion has purchased Skiff, which offers end-to-end encrypted file storage, docs, calendar events, and email. Notion has expanded its own product remit and recently launched a calendar feature last month based off a separate acquisition, so the startup seems to be taking advantage of a somewhat depressed price market to make acquisitions.
VCs shift stance on guns: In this week's Deal Dive, Rebecca Szkutak takes a look at biometric "smart" gun startup Biofire's recent fundraise. She writes that many venture capitalists were historically unable to invest in firearms startups due to vice clauses and the like, but institutional investors are now increasingly open to investing in companies like Biofire.

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Ilara Health raises $4M: Kenya-based health tech startup Ilara Health helps private clinics access key operational items like diagnostic devices and pharmaceuticals, and it just raised $4.2 million to grow in its home market. Annie Njanja reports that the pre-Series A round will also be used to broaden access to healthcare via "a B2B health and occupational service that will enable uninsured workers access care at its network of partner clinics for a fixed monthly fee."

AI field trip: Sequoia's break-out venture fund Peak XV Partners focused on the Indian market is bringing a host of its founders to Silicon Valley this week for AI meetings. This tells us two things: venture firms are not done trying to add value even when the market has returned much of their pricing power over startup rounds; and Silicon Valley really is the AI central hub today.

Chatbots are replacing your drunk uncle: Chatbots from Microsoft and Google were dinged for coming up with creative notes for users regarding the recent Super Bowl game. The chatbots each reported scores before they game had already happened. What's even funnier is that they didn't agree on who ~~had won~~ would win. Go Chiefs.

The state of seed funding: Tim De Chant dug into the current state of the seed capital market, discussing the matter with Talia Goldberg, a partner at Bessemer Venture Partners; Pae Wu, a general partner at SOSV; and Maren Bannon, a partner at January Ventures. The biggest takeaway? "The bar is higher now. Investors are starting to ask diligence questions that in 2021 would have been Series A kind of questions," Wu told TechCrunch+.

AI and elections: More than five dozen elections will occur this year, which puts a massive focus on new AI technology around the world. I suppose that no matter what happens, we'll learn a lot in the coming months. Let's hope that most of it is useful so that we can do better the next time around.

Image Credits: Ilara Health

Before you go

Finally, a perfectly safe AI model: Meet Goody-2, an AI model that is supposedly so squeaky clean that it won't answer anything at all. That will solve the hallucination, training data attribution, and other issues around dangerous answers that many existing AI models suffer from. Now we just need an AI model called Shoes that we can meld with Goody-2 for a great joke model.