Glenn's Weekly Digest - 1/26/24
Your Weekly Guide to the Startup Universe: Navigating the World of VC & Startups for Students
Stories of the Week
A fab-ulous day for semiconductors
OpenAI’s Altman discussed chip-making venture with members of Congress [Washington Post]
OpenAI CEO Sam Altman has engaged in talks with Congress to boost the global supply of sophisticated computer chips. He is pursuing an ambitious and costly project aimed at establishing new chip manufacturing facilities in the United States.
Why it matters: Advanced semiconductor chips play a pivotal role in training and operating AI programs that power generative AI products, such as ChatGPT by OpenAI. Altman, along with other tech industry leaders, emphasizes that AI is set to revolutionize the global economy and they assert that an affordable supply of these computer chips is vital for the United States to remain competitive both economically & in terms of national defense.
Geo-Political Tailwinds: The United States depends heavily on Taiwan Semiconductor Manufacturing Co. (TSMC) for its chip manufacturing needs, as the company produces about 90 percent of the world's sophisticated chips. Yet, with China poised to expand its influence over the region and potentially disrupt U.S. exports, both the U.S. government and private companies are actively preparing backup strategies. To start, the U.S. is allocating billions of dollars to enhance its domestic production of semiconductor chips.
What’s next? Altman has stated that the current global capacity for manufacturing computer chips is insufficient to meet the needs of the impending AI revolution. However, this viewpoint isn't universally shared among tech industry analysts. Some AI experts anticipate a decrease in the demand for AI-specific chips as advancements in technology enable the operation of sophisticated AI with reduced computational power.
Currently, AI companies are eagerly seeking out chips developed by Nvidia. However, competing chip manufacturers such as Advanced Micro Devices and Intel are pouring substantial investments into creating alternative products. Additionally, major tech corporations like Google and Amazon are also venturing into designing their own chips.
Apple puts their car dreams into reverse
Apple Dials Back Car’s Self-Driving Features and Delays Launch to 2028 [Bloomberg]
Apple, at a critical juncture in its decade-long endeavor to develop a car, has shifted to a more modest design for its electric vehicle (EV) project, moving away from its original vision of a fully driverless car. Despite this change, the release date for Apple's EV keeps getting pushed back, with the current target set for 2028, which is about two years later than previously forecasted.
Why this matters: Apple's covert car project, known as Titan and T172, represents one of the company's most ambitious and tumultuous ventures since its inception in 2014. Despite experiencing leadership changes, layoffs, strategic shifts, and delays, it continues to be a significant potential growth avenue for Apple, especially as the company faces stagnating revenue amid a maturing smartphone industry and a slowdown in China, its largest international market.
What’s changed? The original design for Apple's vehicle featured a system that allowed for autonomous driving on highways in certain areas of North America, functioning without human intervention under most conditions. However, the revised, less advanced Level 2+ plan necessitates driver attentiveness and the ability to take control at any time, akin to Tesla's existing standard Autopilot feature in its electric vehicles.
To be determined: The internal perception at Apple is that the recent change in strategy for its car project marks a critical juncture: the company must either successfully launch the product with scaled-back ambitions, or its top executives might reevaluate the project's viability. However, there remains a possibility that Apple could once again alter its approach.
Top Reads This Week
Tech’s Blind Spots: The Startups Building for Underserved Markets [Rex Woodbury]
Rex delivers a thought-provoking piece delving into Silicon Valley's tendency to cater predominantly to its own ecosystem. This insightful article sheds light on overlooked demographics and worker segments brimming with untapped opportunities. It discusses how technology often misses addressing the needs of Baby Boomers, Gen Alphas, and specific worker groups like those in industrials, manufacturing, agriculture, and internet-based roles.
2024 Startups, SaaS, and AI Predictions [Arye Lifshitz]
Arye Lifshitz, an investor that works with the legendary Elad Gil, published an interesting perspective on predictions for the upcoming year. He delves into the future of SaaS, forecasting a widening gap in valuations between resilient and vulnerable businesses, influenced by AI advancements and investor scrutiny. Arye also anticipates significant changes in the startup landscape, with increased layoffs, down-rounds, but also a rise in growth investing. Fascinating trends and predictions galore makes this a piece that provides an interesting overview for the year ahead.
Top 5 Deals of the Week:
Bilt Rewards, a credit card platform that allows consumers to earn rewards on rent spend, has raised $200 million from General Catalyst at a $3.1 billion valuation.
Truewind, a start-up that builds an AI accounting co-pilot, has raised an additional $1 million from Thomson Reuters Ventures.
Spellbook, a Toronto based start-up building an AI co-pilot for lawyers raised a $30 million Series A led by Inovia Capital with participation from Thomson Reurters Ventures, the Legal Tech Fund, Bling Capital, and others.
Tandem, a money management platform for couples, raised a $3.7 million seed round led by Corazon Capital with participation from various angels.
Ansel, an NYC based insurtech on a mission to build a world where health hardships don’t create financial burdens, raised $20 million in funding led by Portage and joined by Two Sigma, Plug and Play, and others.
Venture Jobs of the Week
Associate, Learn Capital [Austin]
Analyst, Array Ventures [Remote]
Senior Investment Associate, Woven Capital [Palo Alto]
Head of Operations, Root Ventures [San Francisco]
Associate, Y Combinator [San Francisco]
2024 MBA Summer Internship, 25madison [New York]
MBA Summer Associate - Venture Investing, Emerson Collective [Bay Area]
Thank you for joining us for another edition of Glenn’s Weekly Digest! We hope you found valuable insights into the dynamic world of venture capital and startups. If you have any feedback or suggestions, feel free to reach out. Stay tuned for more exciting updates next week!
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