Did OpenAI launch the Google killer? CVC going hard on early-stage companies, Big Tech’s absurd $200B AI dump + new open deals 🔥
Election Day in America....Don’t expect anything short of craziness this week!
Welcome to Issue #50 of Startup Deal Desk and Happy Election Day!
Here’s what you can expect in today’s edition:
SearchGPT is here and the battle for search is heating up, satellite texting is the new thing in Apple’s iOS 18, the Dow kicks out Intel and brings in Nvidia.
CVC and AI state of venture funding Q3 2024, and why the 10-year VC terms aren’t working anymore.
3 new open deals:
🦴 Progenerative Medical, 👃 RealNose.ai, 🫁 Epic Airway Systems
and much more.
Keep reading to see the latest deals, news and trends 👇.
And please don’t forget to subscribe!
The potential Google-killer has arrived - SearchGPT launched last Thursday, marking OpenAI’s official entry into search. Aside from cleaner and smarter search results, there’s one big reason a user might choose ChatGPT over Google Search: there’s no clutter of ads or promoted queries pinned to the top. However, AI-powered search is more expensive to operate than traditional search, and it’s not yet clear how OpenAI will finance it for free users. In short, we can’t dub it a Google-killer just yet.
You can now text your ex over satellite - Apple doubles down on satellites with a $1.1B injection into satellite services provider GlobalStar. The iPhone maker will also take 20% ownership of the company, in an equity deal worth about $400M.The news has sent GlobalStar stock soaring, and it hints towards Apple’s growing plans for iPhone satellite features. With iOS 18, for instance, iPhone users are now able to send text messages over satellite, when outside of cellular or WiFi range.
Intel is out, Nvidia is in - After 25 years, Intel is getting replaced by rival Nvidia in the Dow Jones Industrial Average. The switch will take place on November 8. When the news were announced last Friday, Nvidia shares rose 1% and Intel shares were down 1% in extended trading. While Nvidia has been soaring, Intel has been slumping. Long the big bad wolf of PC chips, Intel has lost market share to Advanced Micro Devices, but most importantly, has made very little headway in AI.
State of CVC Q3 2024 - CVC is going hard on early-stage companies this year, with ⅔ of CVC deals happening at this stage – marking a strategic shift toward more emerging opportunities, especially in AI. Although global CVC-backed funding fell 5% QoQ to $15.7B, alongside a 10% decline in deals, $100M+ mega-rounds comprised 51% of total CVC-backed funding in Q3 of 2024 – a notable increase from a quarterly average of 37% in 2023.
State of AI Q3 2024 - What can we say? A new quarter means a flood of reports on the last one, and it wouldn’t be complete without a report on AI. Global AI deal count skyrocketed 24% QoQ to reach 1,245 – its highest quarterly level since peaking in Q1 of 2022. But don’t let that fool you. Global AI funding actually dropped by 29% QoQ. This was driven by a 77% decline in funding from $1B+ AI rounds QoQ.
10-year VC terms aren’t working anymore - 10 years has been the standard venture fund life term for decades, with little reason for change. But there's a reason now: companies in the private market remain private for longer. For many funds and their LPs, extending fund terms is necessary to reap the rewards of risk. Yet, data shows that fund extensions don’t necessarily translate into the expected distributions.
Progenerative Medical: Enhanced orthopedic healing - Improving spinal fusion outcomes with reduced pressure therapy (RPT). Their Regenn™ Therapy is an advanced RPT-based solution that complements current surgical procedures, is effective with 18-24 hours of therapy, and promotes better bone healing. Holds an exclusive IP portfolio of over 200 patents. The company’s Regenn™ Therapy is on track for 510(k) clearance, and is raising $800K to finalize its $2.5M Seed round.
Meet the Founder and learn more about Progenerative Medical here.
RealNose.ai: From scent detection to a diagnostic superpower - A MedTech startup combining AI and bionanotechnology to create non-invasive, scent-based cancer diagnostic tools. Built on DARPA-funded research at MIT, RealNose.ai replicates canine olfactory detection which detects prostate cancer with over 98% accuracy. The company has raised over $1M in the past and is now raising an additional $650K to further develop their MVP and expand their scent detection capabilities.
Connect with the founder and find out more about RealNose.ai here.
Epic Airway Systems: Innovation through low-tech airway products - Their flagship product, The Epic Airway™, combines existing technologies into an all-in-one device that addresses the complexities and risks of intubation procedures. The company holds several patents in the US and Europe and has established a partnership with Aptix, a large contract manufacturer with multiple facilities across the US, Mexico, China, Canada, and the Dominican Republic. Now raising $2M.
Discover more about Epic Airway Systems and meet the Founder here.
Big Tech dump eye-watering sums of money into AI - Wall Street hasn’t been discrete about their opinion on Big Tech’s reckless AI spending spree. Their response? Spend even more. This year alone, the biggest tech firms (you know, Amazon, Microsoft, Meta, and Alphabet) will collectively burn over $200B on AI. And it’s only ramping up. Each CEO has made it clear: next year’s AI budget will be even higher.
Crypto investors going wild just in time for election week - Investors are pouring money into funds tracking bitcoin. Exchange-traded funds (ETF) tracking the spot price of bitcoin notched net inflows of $917.2M on Wednesday (Oct 30), the biggest one-day increase since March. Given the uncertainty, futures markets show investors are bracing for a volatile election week.
Microsoft’s and Meta’s stock tumble - On Thursday, Meta was down more than 2% despite reporting better-than-expected Q3 EPS, after it didn’t forecast its 2025 capital expenditure plans and just talked about “continued investment.” Microsoft was down more than 5% to lead losers in the Dow Jones Industrials despite reporting better-than-expected EPS.
Physical Intelligence secures $400M at a $2.4B post-money - The investment was spearheaded by Amazon’s Jeff Bezos and VCs Thrive Capital and Lux Capital. The company seeks to develop universally compatible software for robots.
BETA Technologies raises $300M+ in equity funding - The electric aviation company’s round was led by QIA, with participation from Fidelity Management & Research Company, TPG Rise Climate, and United Therapeutics.
Fintech Melio raises $150M at a $2B valuation - This funding round includes payments processor Fiserv and the Capital One bank’s venture arm, among a pack of investors (Shopify, Accel, Bessemer Venture Partners, and others.)
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Make sure to check out Progenerative Medical, RealNose.ai and Epic Airway Systems if you’re looking for promising investment opportunities.
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Until next time!