KPIs

The week’s top performance indicators

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Dots & Lines

The week’s top takeaways

• A glowing first half: Reports and data from the first half continue to trickle in and are for the most part positive. Funding was up 16% from the prior quarter, with $79B going into startups. Valuations reached all-time highs across stages, with the median early-stage valuation coming in above $40M. But the data also paints a picture of haves and have-nots, as the bulk of the funding has been going into a small number of companies and the attendant flight to quality suggests far fewer companies stand to receive future funding. On the global front, Asia was a clear laggard, posting its lowest funding totals in a decade stemming from China’s challenges. Investors should find re-assurance that things are going in the right direction.

• But funds still need to re-load: VCs haven’t had the same luck as startups in the current environment. Owing to a continued scarcity of mergers and IPOs, this year is on track to set a decade-low for venture fundraising with only $80B hauled in by GPs. Some critics are even questioning the Yale model, the dogma underpinning the institutional rotation to private markets. The critics say that the abundance of capital going into mediocre businesses will limit the model’s applicability in today’s markets. GPs should stick to their plans, though, as cycles happen in all sectors and this one feels much closer to the end than the beginning.

• Creators coming back: The confluence of three trends - the power of influencers, the content capabilities of generative AI and the effectiveness of small (and single person) creative teams - is driving the resurgence of the Creator economy. The sector has already attracted $1B in funding, roughly equivalent to last year’s total, with the second quarter alone raking in almost $700M. Services like song creator Suno, text to video creation tool Pika Labs, and social shopping app Flip have been energized by GenAI, and more are likely to follow. Keep an eye on this space as content creation continues to flourish.

• Google’s parent Alphabet is reportedly deep in talks to purchase cybersecurity startup Wiz for $23B, which would be its biggest acquisition to date and could catalyze more buyouts if it closes

• In a nod to increased regulatory scrutiny, Microsoft left the board of Mega-unicorn OpenAI and Apple kept its distance as well

• Crowdfunding is still seeing a dropoff this year, with only $274M closed at the halfway point, though bullish signals persist like record-setter Gumroad offering liquidity via buyback

• Despite its stated intention to innovate and become more efficient, the federal government has only spent $22B on startup products in recent years, less than half of what those companies have raised

• Female GPs caught up, hauling in $1.44B in H1 and getting back on track to match last year’s total of $3B raised after falling off that pace in Q1, despite the industry’s overall drought

• Andreesen is reportedly procuring 20,000+ AI chips to back up the $1.3B the firm has committed to GenAI, both to woo new portfolio companies and support existing ones

• Connecticut-based non-alcoholic brewery Athletic, which was founded in 2017 and shipped 260,000 barrels last year, raised $50M on an $800M valuation from General Atlantic

• HarmonyCares, an in-home health care provider based in Michigan, raised $200M led by General Catalyst

• Hebbia, a New York-based AI startup building work agents that is profitable and boasts $13M in revenue, raised a $130M Series B on a $700M valuation from a16z and others

• Pittsburgh-based Skild AI, building a foundational AI model for robotics, raised a $300M Series A on a $1.5B valuation led by Lightspeed, Coatue and others

• HongShan, Sequoia’s China split-off fund, raised $2.5B for its latest tech fund