Dealmaker by The Information Staff

Two times/week

Dealmaker

By The Information Staff

Reporters Cory Weinberg and Katie Roof tell you what’s coming next, who’s winning—and who’s losing—in the high-stakes world of startup investing.

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Recent Editions

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Is This the Best Time to Invest in China? Its VC Funds Hope So

By Jing Yang and Juro Osawa · Jun 6, 2024 3:03pm PDT

It’s been pretty bleak for venture capitalists in China over the last two years. U.S. pensions and endowments halted investments. Existing investors demanded cash distributions. Fundraising plunged. But lately China’s venture capitalists have decided they can’t wait until the downturn passes to hit the fundraising circuit.Several China-based... It’s been pretty bleak for venture capitalists in China over the last two years. U.S. pensions...

via WndrCo

Jeffrey Katzenberg on the Long, Steep Road to Raising a VC Fund

By Kate Clark · Jun 4, 2024 3:00pm PDT

Hollywood veteran Jeffrey Katzenberg has raised $460 million for his investment firm WndrCo’s first set of dedicated venture capital funds, including a $60 million seed fund. The new fund stands out in a tepid year for VC fundraising—and shows Katzenberg’s name has plenty of pull with investors. That’s despite the collapse of Quibi, the... Hollywood veteran Jeffrey Katzenberg has raised $460 million for his investment firm WndrCo’s...

Photo via Midjourney

The Return of the 100X Club

By Kate Clark · May 30, 2024 3:40pm PDT · 4 comments

It’s funny how history has a way of repeating itself. This week, we wrote that artificial intelligence-powered search engine Perplexity is raising more money at a $3 billion valuation in a deal led by Bessemer Venture Partners, a lofty price considering it is generating just over $20 million in annual recurring revenue. That news got... It’s funny how history has a way of repeating itself. This week, we wrote that artificial...

Ilya Sutskever. Photo via YouTube/Dwarkesh Patel.

What’s Next for OpenAI’s Ilya Sutskever?

By Kate Clark · May 28, 2024 3:00pm PDT

Ilya Sutskever. Photo via YouTube/Dwarkesh Patel.

What’s Next for OpenAI’s Ilya Sutskever?

By Kate Clark · May 28, 2024 3:00pm PDT

Ilya Sutskever, a co-founder and former chief scientist at OpenAI, is currently the most sought-after entrepreneur in town. We don’t yet have the details on Sutskever’s next role. But we wouldn’t be surprised if he joins an OpenAI competitor, like Anthropic or Elon Musk’s xAI, moves that could further strain his relationship with OpenAI’s... Ilya Sutskever, a co-founder and former chief scientist at OpenAI, is currently the most...

Photo by Calm.

Calm Lures Strategic Partners With Cheap Stock

By Abubakar Idris · May 23, 2024 4:38pm PDT

Consumer startups aren’t getting a lot of attention from venture capitalists these days, except if they’re powered by artificial intelligence. (More on that later.) That disinterest has made it particularly challenging for VC-backed startups wrestling with a slowdown in consumer demand after a spike during the pandemic. One path forward:... Consumer startups aren’t getting a lot of attention from venture capitalists these days, except...

Jason Warner, co-founder of Poolside AI. Photo by Bloomberg via Getty Images.

AI Startup Poolside Wants a $2 Billion Valuation

By Kate Clark · May 21, 2024 4:00pm PDT

Another day, another deal. Artificial intelligence startup Poolside is raising more capital from investors and wants a valuation of around $2 billion, according to a person briefed on the deal. The startup, which was co-founded by former GitHub CTO Jason Warner, is developing a specialized large-language model to automate coding. It’s... Another day, another deal. Artificial intelligence startup Poolside is raising more capital from...

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The Year of Venture Capital Breakups

By Kate Clark · May 16, 2024 3:05pm PDT · 1 comment

This is turning into the year of venture capital breakups.First, two high-profile splits announced last year became official in 2024. At Tiger Global Management, private investments chief Scott Shleifer moved into an advisory role at the firm led by Chase Coleman. And Neil Shen’s Sequoia Capital China (now HongShan) officially split from... This is turning into the year of venture capital breakups.First, two high-profile splits...

Riyadh, Saudi Arabia. Photo by Bloomberg via Getty Images.

Middle East Money Takes a Round Trip

By Kate Clark · May 14, 2024 3:00pm PDT

Riyadh, Saudi Arabia. Photo by Bloomberg via Getty Images.

Middle East Money Takes a Round Trip

By Kate Clark · May 14, 2024 3:00pm PDT

In the world of artificial intelligence, startups are raising heaps of cash from cloud and chip providers like Google and Nvidia. It’s a great deal for the big tech companies. The startups are also their customers, so much of that capital cycles back as revenue, a phenomenon some critics have dubbed “round-tripping.”A similar dynamic is... In the world of artificial intelligence, startups are raising heaps of cash from cloud and chip...

Elon Musk at the Milken Institute's Global Conference on Monday. Photo by Apu Gomes/Getty Images.

Great—More Money for Musk

By Kate Clark · May 9, 2024 3:09pm PDT · 9 comments

Elon Musk is raising $6 billion for xAI, maker of Musk’s “anti-woke” artificial intelligence chatbot Grok, in a deal set to close Friday, according to our sources. The startup’s first outside funding values xAI at $18 billion, remarkable for a year-old company. It’s a reminder of what’s wrong with venture capital. The massive round has come... Elon Musk is raising $6 billion for xAI, maker of Musk’s “anti-woke” artificial intelligence...

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‘If Not Now, When?’: Late-Stage Investors Open Their Wallets

By Kate Clark · May 7, 2024 3:01pm PDT

Venture capitalists are getting comfortable writing big checks again, judging by April deal activity. The lingering panic that’s occupied the private tech markets for the past two years is subsiding, investors say, due to the stock market’s rebound and because these larger investors are fed up with hoarding cash. So, despite the slow... Venture capitalists are getting comfortable writing big checks again, judging by April deal...

The Dubai skyline. Photo via Adobe Stock.

The Startup Scene in Abu Dhabi and Dubai is Bustling

By Kate Clark · May 2, 2024 3:00pm PDT · 2 comments

I just landed back in New York after spending the past week in Dubai and Abu Dhabi, two important cities in a region undergoing a remarkable transformation into a global tech hub.Government initiatives are propelling those changes, and those efforts seem to be paying off. Abu Dhabi, the capital of the United Arab Emirates, has become an... I just landed back in New York after spending the past week in Dubai and Abu Dhabi, two important...

Photo via Getty Images.

More VC Firms Are Investing in AI Rivals

By Natasha Mascarenhas · Apr 30, 2024 3:22pm PDT · 1 comment

Photo via Getty Images.

More VC Firms Are Investing in AI Rivals

By Natasha Mascarenhas · Apr 30, 2024 3:22pm PDT · 1 comment

Does it make sense to back rival language model companies Anthropic and OpenAI (and Cohere and Mistral)? Some investors seem to think so, taking an approach to startup investing that looks a little like buying an index fund with an array of tech stocks.Last week my colleagues and I broke the news that Sequoia Capital was among the investors in a... Does it make sense to back rival language model companies Anthropic and OpenAI (and Cohere and...

Rubrik CEO, Bipul Sinha. Photo by David Paul Morris/Bloomberg via Getty Images.

A VC Lesson From the ‘Rodney Dangerfield of SaaS’

By Cory Weinberg · Apr 25, 2024 5:53pm PDT

Venture capitalists should try this fun game at their next (increasingly alcohol-free) game night: artificial intelligence funding mad libs.[VC fund 1] and [VC fund 2] lead funding round for [number]-year-old [type of AI startup], founded by professors at [name of university], at a $[some-billion] valuation.This week, that formula would have... Venture capitalists should try this fun game at their next (increasingly alcohol-free) game...

Anton Levy of General Atlantic at The Information's Private Capital Conference earlier this month. Photo by Nicole Pereira.

ByteDance Investors’ Waiting Game

By Natasha Mascarenhas and Laura Mandaro · Apr 23, 2024 4:31pm PDT

Most venture capitalists often see themselves as long-term investors. Those who backed ByteDance, the world’s most valuable venture-backed company, have had plenty of opportunity to test that credo. After pouring $8 billion into TikTok’s parent company, and sometimes buying more shares from other shareholders, these investors have seen the... Most venture capitalists often see themselves as long-term investors. Those who backed ByteDance,...

Photo via Lacework.

Lacework’s Fire Sale Tarnishes Sutter Hill’s Incubation Strategy

By Kate Clark · Apr 18, 2024 3:40pm PDT

Cybersecurity company Lacework is in talks to sell to its competitor, Wiz, for between $150 million and $200 million, a fragment of its 2021 valuation of $8.3 billion, Cory and Aaron report. It’s a painful ending for the investors that poured nearly $2 billion into the 9-year-old startup, as well as the employees, who were hoping for a much... Cybersecurity company Lacework is in talks to sell to its competitor, Wiz, for between $150...

Photo via Shutterstock.

A Fresh Sign Creator Startups Haven’t Hit Bottom

By Kate Clark · Apr 16, 2024 3:08pm PDT

Photo via Shutterstock.

A Fresh Sign Creator Startups Haven’t Hit Bottom

By Kate Clark · Apr 16, 2024 3:08pm PDT

These days, when I think of startups in the “creator economy,” a subsector propelled by the rise of TikTok and influencers, I think of pricey disappointments like Cameo and Clubhouse, or one of several smaller ventures that shuttered in recent months. And I struggle to come up with any big winners, beyond giants like ByteDance and Instagram,... These days, when I think of startups in the “creator economy,” a subsector propelled by the rise...

Photo via Adobe Stock.

Investors Circle ‘Most Hated’ Fintech and E-Commerce Sectors

By Natasha Mascarenhas · Apr 11, 2024 3:51pm PDT · 1 comment

The fintech and e-commerce sectors, two of the hardest hit by the end of the venture capital funding boom, are still showing plenty of carnage. Some investors say it’s the perfect time to go bargain hunting. At the end of 2022, fintech was “probably the most hated area and probably lending within that [sector], and we actually have a couple... The fintech and e-commerce sectors, two of the hardest hit by the end of the venture capital...

Anton Levy, co-president, General Atlantic, left. Philippe Laffont, founder Coatue Management, right. Photos by Nicole Pereira.

General Atlantic Sees Value in Chinese Startups; Coatue Tries to Avoid AI Exuberance

By Abubakar Idris · Apr 9, 2024 3:14pm PDT

The stock market is near a record high. Six public tech companies are worth more than $1 trillion. Even bitcoin has made a comeback! But the titans of private capital aren’t over the moon with optimism yet. That may be because they’re still working through the hangover of the zero-interest-rate funding boom in their own portfolios. “... The stock market is near a record high. Six public tech companies are worth more than $1...

The Kuwaiti Fund Promising a Shortcut to Sovereign Wealth

The Kuwaiti Fund Promising a Shortcut to Sovereign Wealth

By Kate Clark · Apr 4, 2024 3:00pm PDT

We know that many of Silicon Valley’s investors are desperate to tap into the Middle East’s plentiful capital reserves. Less discussed are the hurdles Middle Eastern investors face while trying to land stakes in Silicon Valley’s best startups.A new fund wants to help both sides. Fahad AlSharekh, vice chair of Kuwaiti asset manager Kamco Invest,... We know that many of Silicon Valley’s investors are desperate to tap into the Middle East’s...

Sam Bankman-Fried at Manhattan Federal Court on June 15, 2023. Photo by Getty Images.

Crypto’s New Beginning; Seed Valuations Rise 25% From 2021

By Kate Clark · Mar 28, 2024 3:04pm PDT

Sam Bankman-Fried at Manhattan Federal Court on June 15, 2023. Photo by Getty Images.

Crypto’s New Beginning; Seed Valuations Rise 25% From 2021

By Kate Clark · Mar 28, 2024 3:04pm PDT

Fallen crypto mogul Sam Bankman-Fried was sentenced to 25 years by a federal judge after he was found guilty of seven counts of criminal fraud. Facing a possible 110 years, he got off easy; the crypto industry, however, did not. The yearslong saga tarnished crypto’s reputation among institutional investors and sparked an exodus of capital. ... Fallen crypto mogul Sam Bankman-Fried was sentenced to 25 years by a federal judge after he was...