ℹ️ Ex-HubSpot exec builds an AI-powered CRM that learns for you, with $4M seed led by Sequoia
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© Unlike modern CRMs, which are essentially giant spreadsheets that somebody needs to populate and keep updated, Day learns everything about a person from conversations they had with the company, emails and public records such as LinkedIn.

O’Donnell knows CRMs. He was responsible for creating one of the most popular ones out there, HubSpot’s.

© O’Donnell spent more than 10 years at HubSpot, initially turbocharging the company’s marketing automation solution, and was later tapped by the founder and former CEO Brian Halligan to build HubSpot’s customer relationship management tool. That CRM later became the product HubSpot is best known for, which eventually helped earn O’Donnell the title of chief product officer.

While O’Donnell enjoyed being an executive at HubSpot, which now has a market capitalization of nearly $30 billion, he missed building new software. So in 2021, he left HubSpot to work on Arianna Huffington’s Thrive. He was also simultaneously involved with ProfitWell, a bootstrapped business he co-founded that sold to Paddle for $200 million in 2022.

O’Donnell didn’t see himself at Thrive long-term, so it came to a point when he asked himself, “Should I retire?” he said. “I wasn’t really sure what to do.”

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⭐️Paris-based VC Breega hits first close of $75M Africa fund to back pre-seed and seed startups
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💡 Paris-based VC firm Breega has observed Africa’s tech ecosystem mature over the years. From receiving less than a billion dollars in venture capital per year to a record-high $6 billion, there’s also been an increase in high-growth companies, from one unicorn to seven within the span of three years.

⭐️ Now the VC wants to put some of its own money behind what it sees, with a $75 million fund to invest in early-stage startups in Africa. It’s secured commitments for around 70% of the capital in the first close, the firm revealed to TechCrunch.

Since entering the VC scene in 2015, Breega has fully raised four funds: a first seed fund (€45 million), a second seed fund (€110 million), a first venture fund (€106 million), and a second venture fund (€250 million). In under a decade, the French investor, with a portfolio of over 100 startups across 15 countries, has reached $700 million in assets under management.

💡 Marrel notes that this approach, coupled with a dedicated scaling and portfolio support team, has propelled Breega to become one of the fastest-growing VCs in Europe. The intention is to replicate this success in Africa.

As such, launching a fund for early-stage startups stemmed from a desire to tap into the continent’s opportunities. Larger Africa-focused firms with European roots, such as Partech and Norrsken22, operate a similar strategy.

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🔔 Lawyer-in-the-loop’ startup Wordsmith wants to bring AI paralegals to all employees
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💻 Wordsmith, a fledgling Scottish legal tech startup, has somehow managed to attract the backing of two well-known venture capital firms. The startup targets in-house legal teams and law firms with an AI platform that they can configure to help other workers in the company.

This way, anyone in the company can solicit help with legal tasks such as reviewing contracts and answering specific questions about a document.

Incorporated in October last year, the Edinburgh-based company is the handiwork of former senior TravelPerk executives Ross McNairn (CEO) and Robbie Falkenthal (COO), alongside CTO Volodymyr Giginiak, who served in various engineering roles at Microsoft, Facebook, and Instagram. Six months after leaving their previous positions, Wordsmith already claims notable customers, such as Trustpilot, while it’s partnering with at least one major law firm — DLA Piper.

💻 This early traction has garnered the attention of global VC firm Index Ventures, which has led a $5 million seed investment into Wordsmith alongside General Catalyst and Gareth Williams, founder and former CEO of Scottish tech unicorn Skyscanner.

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🚀 General Catalyst merges with Venture Highway in India push
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The Silicon Valley venture capital group plans to invest from $500 million to $1 billion in India over the next three years, it told TechCrunch

📱 General Catalyst, a Silicon Valley-based venture capital group, is expanding its presence in India by joining forces with local venture firm Venture Highway and earmarking $500 million to $1 billion for investments in the country.

📱 Venture Highway’s investments include social commerce startup Meesho and B2B industrial marketplace Moglix. TechCrunch reported in January that the two venture firms were discussing a tie-up.

The deal will see the combined entity plot a multi-stage investment strategy for General Catalyst in India, spanning early- and growth-stage startups across industries, Venture Highway’s founder, Neeraj Arora, and General Partner Priya Mohan told TechCrunch in an interview.

📱 Venture Highway, which raised $78.6 million for its second fund in 2020, has traditionally focused on early-stage investments. As part of the General Catalyst team, it will expand its remit to incubating startups. “Our vision is to be part of building a number of companies that will not only go public but also be needle-moving for the economy,” said Mohan.

General Catalyst, which manages over $25 billion in assets, plans to invest between $500 million to $1 billion in India over the next three years, said Arora, who previously served as chief business officer at WhatsApp and played an instrumental role in the instant messaging app’s sale to Meta.

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ℹ️ Prosus zeroes out its 9.6% stake in Byju’s
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© Prosus, one of Byju’s largest investors, on Monday said its once-$2.1 billion worth stake in the Indian edtech startup is now worth nothing, but it is still hopeful that the formerly most-valuable Indian startup can be salvaged.

The largest external investor in Byju’s with a 9.6% stake, Prosus said in its quarterly report that its stake in the startup is now worth zero “due to the significant decrease in value for equity investors.” Prosus Group CIO, Ervin Tu, said on an earnings call that the firm is still hopeful about Byju’s outlook, but improving governance at the Indian firm will be key.

The Indian edtech giant has had a difficult couple of years as it grappled with a series of financial and governance setbacks that have tarnished its reputation and imperiled its future. The startup’s woes were amplified last year when it failed to meet financial reporting deadlines and ultimately reported revenues well below its own projections.

© The financial stumbles were compounded by the sudden departures of its auditor and board members, including a Prosus executive, and scuttled a potential $1 billion fundraising effort. In a desperate bid for capital, the startup raised $200 million this year, but at a drastically reduced valuation of about $225 million to $250 million. This lifeline has also been entangled in legal disputes with some of Byju’s largest backers, including Prosus.

© The South African-Dutch investor, whose portfolio includes high-profile companies like Tencent, Delivery Hero, Swiggy and Stack Overflow, has invested more than $570 million in Byju’s over the years. It has never sold any shares in the Indian edtech startup, whose valuation climbed to a peak of $22 billion in early 2022. Prosus on Monday said its stake in Byju’s now represented a fair value loss of $493 million, after the adjustment, in its current financial year.

Prosus has also cut down the value of its other investments: It reduced the value of its stake in Stack Overflow, which it bought for $1.8 billion in 2021, by 39%, and has lowered the worth of its stake in Indian online pharmacy, PharmEasy, by 35%.

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✅ What Vinod Khosla says he’s ‘worried about the most’
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💻 Vinod Khosla is more popular than ever right now. The Sun Microsystems co-founder turned prominent investor — first at Kleiner Perkins and, for the last 20 years, at his venture firm Khosla Ventures — has always been sought after by founders thanks to his no-nonsense advice and his firm’s track record, including bets on Stripe, Square, Affirm, and DoorDash.

But a $50 million gamble on OpenAI back in 2019 — when it was far from clear that the outfit would succeed on the scale that it has — put Khosla Ventures, and Khosla himself, squarely in the spotlight.

He’s thoroughly enjoying himself. I sat down with Khosla this past week in Toronto at the Collision conference, and ahead of our stage appearance, he told me that he’s been appearing in public — either onstage or on podcasts or television interviews — several times a week lately. Asked if he was exhausted by the schedule — for example, he flew into Toronto just hours before our sit-down — he shrugged off the suggestion.

💻 Certainly, there are things he prefers to talk about, and the art of deal-making is not among these things. “Frankly, the investor side is much less interesting to me,” he said when I asked him about something I heard recently, which is that he hasn’t taken a dollar in management fees since starting Khosla Ventures, despite that it now has $18 billion in assets under management. (He confirmed this, but he said that’s only true of himself and not a corporate-wide policy.)

💻 He’s much more passionate about the startup opportunities he spies in a landscape being changed daily by advances in AI, so we talked about some of this white space.

We also talked about what concerns him the most about AI’s ripple effects; FTC Chair Lina Khan; and why, in his view, the “Europeans have regulated themselves out of leading in any technology area.”

We talked first about Apple’s splashy new deal with OpenAI, which allows Apple to integrate ChatGPT into Siri and its generative AI tools. Apple may be striking similar deals with other AI models, including with Meta, but naturally, as an OpenAI investor, Khosla is bullish on the tie-up, which is the only one Apple has announced publicly so far.

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💬 Deal Dive: Sir Jack A Lot returns with a startup for retail traders
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When former YouTube product manager Kevin Xu, known as “Sir Jack A Lot” on Reddit, turned $35,000 into $8 million trading stocks between 2020 and 2022, many people thought his fortunes, and his way of investing, had peaked, just like 2021’s memestock craze had.

📱 Xu doesn’t agree, though, and he’s now building a startup for retail investors that aims to bring the good-natured investing advice and community that people used to enjoy on platforms like the WallStreetBets subreddit, but with a layer of accountability that discourages scammers and grifters.

📱 Launched in April 2022, AfterHour lets users link to their stock brokerage accounts and, under a username of their choosing, post their investments to a social feed. “The only reason people trust me and Roaring Kitty is that we are transparent,” Xu told TechCrunch. “Why not show your actual positions or prove you are actually in something? [AfterHour] brings back a level of credibility and trust. You connect your brokerage and share real verified positions and screenshots.”

The company currently has more than 23,000 users, and while that’s not an eye-popping number by any means, its user base is growing, and early adopters seem dedicated — Xu said that more than 70% of its users are on the app every single day. The company is currently focused on growth, Xu said, but has plans for how to monetize in the future.

📱 “Monday to Friday, 9:30 a.m. to 4 p.m. is the game,” Xu said. “When we started, I was so scared that it would be quiet on the weekends, but on Monday, people just come back. We don’t do any scammy push notifications to get people back on Mondays, but they naturally come back.”

The startup recently raised a $4.5 million seed round led by Founders Fund — Keith Rabois’ last investment at the firm — and General Catalyst. Pear VC, Daybreak Ventures and F4 Fund also participated, among several others. Xu said AfterHour is now focusing on growing its user base and its team

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🐵 Seizing the Moment: Strategies for Startups to Outmaneuver Competition in a Turning Economy
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👍 The Fed no longer predicts a recession. Economic data is turning more positive, eg housing starts exceeded forecasts. 80% of public companies beating earnings estimates - three percentage points higher than the 5 year average.

This is the moment startups with big balance sheets’ advantage will shine.

👍 On the other hand, enough uncertainty permeates the market to depress prices. Public software companies’ share prices have fallen 10% on average in the last 30 days dotted with positive notes like the stabilization cloud growth rates for Microsoft & Google.

Efficiency has been the watchword for the last 3-4 quarters. Most companies have trimmed excess costs to drive go to market sales efficiency & burn ratios. For those companies with hundreds of millions on the balance sheet, they have two strategic options to evaluate.

👍 First, acquisitions. Many startups will look to raise starting in September. The fundraising market, while active, isn’t fully thawed. The metrics for Series As remain unclear, which provides an opening for selective technology & team acquisitions at reasonable prices.

👍 Second, scaling the marketing, then the sales spending as unit economics justify. Startups with bigger balance sheets will be able to ramp much more quickly than those needing to raise capital before scaling the GTM once more. Responding faster to market pull will increase their market share.

The right strategic bet on either of these options can provide a startup with significant advantage into this next economic cycle.

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⭐️ Hebbia raises nearly $100M Series B for AI-powered document search led by Andreessen Horowitz
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💡 The round valued the company between $700 – $800 million although TechCrunch couldn’t verify whether that valuation is pre- or post-money. (One possible scenario is $700 million pre/$800 million post.)

💡 Hebbia disclosed in an SEC filing in May that it had by then raised $93 million out of a hoped-for $100 million but we understand from two of the people that the round hit a near $100 million mark and has closed.

Hebbia and Andreessen Horowitz didn’t respond to a request for comment.

Hebbia was founded in 2020 by George Sivulka, who launched the company while working on his PhD in electrical engineering at Stanford. Sivulka was inspired by his friends working in the financial industry who told Sivulka that part of their long work weeks was spent searching for information in SEC filings and other dense documents. Sivulka thought that AI could help them save hours at the office and give them more time for rest and sleep.

Hebbia’s AI can look over billions of documents at once, including PDFs, PowerPoints, spreadsheets and transcripts and return specific answers, the company says.

💡 The startup sells primarily to financial service firms, including hedge funds and investment banks. But its product could also be used by law firms and other professional domains.

💡 The latest funding brings Hebbia’s total capital to over $120 million. The company raised its $30 million Series A in Sept. 2022 led by Index Ventures with participation from Radical Ventures.

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🍔 Andrew Ng plans to raise $120M for next AI Fund
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👍 AI big shot Andrew Ng’s AI Fund, a startup incubator that backs small teams of experts looking to solve key problems using AI, plans to raise upward of $120 million for its second tranche.

A filing with the SEC shows that the AI Fund’s second fund, AI Venture Fund II, has so far amassed $69.75 million from 13 partners — leaving around $50 million to be invested. The AI Fund’s PR declined to comment.

Ng, the founder of the Google Brain deep learning project, co-founder of Coursera, and recent Amazon board appointee, was one of the most recognizable names in the AI community when he became Baidu’s chief scientist in 2014. He left Baidu in 2017 to jumpstart a number of AI ventures, including the DeepLearning.ai course and Landing AI, a startup developing AI tools targeting manufacturing companies.

👍 Ng launched the AI Fund in 2018 with $175 million, serving as the incubator’s GP and leading its direction. (On the aforementioned SEC filing, he’s named as the “managing member of the general partner” for AI Venture Fund II.)

👍 The idea was to provide funding at the seed and Series A stages of a company’s life cycle, allowing teams to work in relative stealth until they were ready — and connecting them with Ng’s extensive professional network

At $120 million, AI Venture Fund II would be considerably smaller than the first AI Fund tranche. Still, it’s more than double what Ng reportedly originally hoped to raise — $50 million — for the AI Fund’s follow-up.

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📎 As Spain gets its latest VC fund, Southern Europe appears to be on a roll
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Evidence for this was apparent during Mobile World Congress in Barcelona earlier this year, as time and time again your TechCrunch reporter bumped into Northern European VCs scouting startups on the “Iberian peninsula” (Spain and Portugal).

These young companies bring a killer combination that VCs love: significantly lower operating costs and far less punchy valuations.

📱 Further evidence of this “Southern trend” arrives with news that a new venture capital fund, Plus Partners, is being launched by Enrique Linares, one of the co-founders of breakout European unicorn letgo, and Oriol Juncosa, a veteran of the Barcelona VC scene. While Plus Partners hasn’t released a figure for the launch of their new fund, the rumor I’m hearing is it will be in the $30 million-$50 million range.

📱 Looking at the fund’s co-founders, Linares led letgo, a used goods marketplace, to become the first Spanish startup to achieve unicorn status, attracting investment from Accel, Insight Partners and Prosus, among others. Prior to letgo, he co-founded Captalis, a fintech company with a significant presence in LatAm.

Juncosa started his VC career at Nauta Capital in Barcelona and went on to co-found the early-stage VC firm Encomenda Smart Capital. He then become CFO of Carto, a data visualization SaaS company based in the U.S. and Spain, which has raised more than $100 million.

📱 According to a Dealroom report on the Spanish tech ecosystem, the combined enterprise value of Spanish startups surpassed €100 billion in 2023. It also found venture investment into Spanish startups held up last year, with €2.2 billion raised across some 850 funding rounds.

Lastly, the European Investment Bank’s venture capital arm also backed a new fund in Spain this year which aims to invest €1 billion ($1.1 billion) in growth-stage tech startups.

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💎 Austin-based Ironspring Ventures raised $100M to invest in the industrial revolution
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💻 The Austin, Texas-based firm raised $100 million for its second fund to focus on industrial startups. This is a noticeable increase from the firm’s $61 million debut fund that closed in 2021. This latest raise enabled the firm to hire its first principal, Colleen Konetzke, and a head of platform, Stephanie Volk. The firm plans to invest Fund II into 20 startups, backing four to five companies a year.

The industries Findley is referring to include: manufacturing, construction, transportation and energy. The firm backed 16 companies in its first fund, including Solvento, a payments infrastructure startup for trucking companies in Mexico; OneRail, a last-mile logistics startup; and Prokeep, a communications platform for distributors, among others.

“What we saw back then was as true as we see today,” Ironspring co-founder and general partner, Ty Findley told TechCrunch. “There is a big gap in the venture industry that deeply studies and has genuine GP market fit with these industrial markets and can help them navigate a pretty challenging go-to-market [process].

💻 “We are seeing more top-tier tech and innovation talent flood into these industries,” Findley said. “Whether they are recirculating from recent tech unicorns, or just other tech talent that simply wants to make a big impact on their career that’s not based on photo sharing or adtech or chasing the next crypto coin, that is what the macro trends are.”

💻 GoodShip is a good example of this. The freight orchestration and procurement platform was started by former operators at Convoy. Ironspring co-led the firm’s 2023 seed round alongside Chicago Ventures and re-upped at the Series A earlier this year.

Ironspring being based in Austin is an asset, Findley said, due to where they invest — a narrative that conflicts with how many others in the venture ecosystem view the once emerging tech hub. Findley said that many of the industries the firm is focused on have history in Austin, and with Tesla moving its headquarters there and the recently approved $6.4 billion awarded from the infrastructure act for

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