April 18th Newsletter

On Wednesday, Fed Chair Powell said tariffs would raise inflation, so the Fed will wait on rate cuts amid economic uncertainty; the tariffs, with their inflationary effect, make the Fed’s dual mandate of price stability and full employment extremely challenging. Nvidia took a $5.5B charge tied to their H20 chips, which only have 14% of the compute throughput of Nvidia’s H100 chip released in October 2022. In tech, Elliott Management took a $1.5B stake in Hewlett-Packard Enterprise, aiming to revive shares down 30% year-to-date amid tariff fallout. Also, Meta’s antitrust trial began this week, with the FTC seeking to force divestitures of Instagram and WhatsApp. The Department of Justice prevailed in a landmark antitrust case against Google. Additionally, startup funding hit $91.5B in Q1, up 18.5% from last quarter, but the 2025 outlook remains grim amid stalled exits. Lastly, OpenAI updated its safety framework, saying it may ease safeguards if rivals release high-risk AI without protections.

AI Valuation for Founders: Our team has compiled a deck focusing on the latest AI valuation trends, investor sentiment, and essential metrics for founders and business leaders aiming to navigate the rapidly evolving AI investment landscape. 

Top 5 AI Highlights

[1] 🚀OpenAI is developing a ChatGPT-powered social network, potentially integrated into its app. The move comes as ChatGPT reached 46 million downloads in March, surpassing both TikTok and Instagram. Additionally, OpenAI released GPT-4.1, a new model targeted for developers and businesses aiming to integrate AI. OpenAI also released o3 and o4-mini, new reasoning models with top scores in math, code, and image analysis. These models support tools like web browsing and image uploads, now available to Pro, Plus, and Team users. OpenAI is also in talks of paying $3 billion to acquire Windsurf, an AI coding assistant company. More from The Verge, TC, and CNBC.

[2] 🔒Safe Superintelligence (SSI), the AI startup led by OpenAI co-founder Ilya Sutskever, has raised another $2B, bringing its valuation to $32B. Backed by Greenoaks, SSI now totals $3B in funding. The company states it has one goal: building a “safe superintelligence”. Despite the massive valuation, SSI remains highly secretive, with no product yet revealed, and has only a mission statement on its website. More from TC and SSI.

[3] 🏗️Nvidia is ramping up U.S. production, announcing plans to build AI supercomputers in Texas and manufacture $500B worth of AI infrastructure domestically over the next four years. This strategic move follows the U.S. government's decision to require indefinite licenses for Nvidia’s H20 chip exports to China, citing national security risks. Nvidia expects a $5.5B financial hit tied to the restriction. While the company won’t comment on timing, the shift appears influenced by mounting tariffs and political pressure to onshore AI tech manufacturing. More from Nvidia, CNBC, and TC.

[4] ⚡Former Google CEO Eric Schmidt says Canada could be a key player in the global AI race—thanks to its vast, underutilized hydroelectric power. Speaking at TED in Vancouver, Schmidt emphasized the U.S. will need 90 gigawatts more energy to keep pace with AI demands and flagged Canada as the ideal supplier – if U.S.-Canada cooperation can survive Trump-era trade tensions. Schmidt warned of a dangerous global arms race for AI dominance, urging urgent diplomacy to avoid potential conflict over data centers and computing infrastructure. More from FP.

[5] 🌱Geoff Ralston, former Y Combinator president, has launched the Safe Artificial Intelligence Fund (SAIF), focused exclusively on AI safety and responsible deployment. SAIF will write $100K SAFE investments (with a $10M cap) into startups enhancing AI transparency, compliance, IP protection, and disinformation defense. Ralston emphasizes non-lethal AI, ruling out backing fully autonomous weapons but open to weapon safety systems. Leveraging his YC roots, he’ll also mentor startups and connect them to top investors. More from TC.

Founder’s Corner

2024 was a year of positive funding growth for many startup sectors

What We Read and Watched This Week

• Figma files for IPO this week after a failed acquisition by Adobe for $20 billion 16 months ago. (Reuters)

• A US Judge ruled Google illegally monopolized ad tech, prompting a possible breakup and major industry-wide antitrust repercussions. (NYT)

• Read: Meta’s response to the FTC on the Antitrust Case. (Meta)

  

• Watch: OpenAI unveils Codex CLI, a platform that turns natural language into code. (YT)

• Up to 18% of the songs uploaded to Deezer, a music streaming platform, are AI-generated (Reuters)

AI M&A and Fundraising news (Apr 11 — Apr 17)

• Assort Health: AI voice agents for medical calls, raised a $22M Series A.

• Atomic: AI inventory optimization platform, raised a $3M Seed.

• Brandlight: Monitor brand visibility in AI search, raised $5.75M Pre-Seed.

• Capsule: AI video editor for marketing and media teams, raised a $12M Series A.

• Chapter: AI for Medicare plan aggregation, raised $75M.

• ClearCOGS: AI forecasting software for restaurant operations, raised a $3.8M Seed.

• ConductorAI: AI for navigating government workflows, raised a $15M Series A

• Corvic AI: Multimodal data infra for enterprises, raised a $12M Seed.

• Deck: AI-powered platform for user-permissioned web data, raised a $12M Series A.

• Doss: ERP and data platform for AI agents, raised a $18M Series A.

• Friday Harbor: AI platform for mortgage loan officers, raised a $6M Seed.

• Goodfire: Decoding AI model internals, raised $50M.

• Hammerspace: Data platform for AI pipelines, raised a $100M Series B.

• Lotic.ai: Personalized wisdom engine for self-understanding, raised a $16.2M Series A.

• Loti: Deepfake detection and takedown platform, raised a $16.2M Series A.

• Mindset AI: Conversational AI for software companies, raised $5.7M.

• Nexad: Personalized ads for AI conversations, raised a $6M Seed.

• Noto: AI platform for tutoring and lesson centers, raised a $3.8M Seed.

• Octolane: AI CRM that automates sales tasks, raised a $2.6M Seed.

• Pillar Security: Manage AI lifecycle security risks, raised a $9M Seed.

• Plastic Labs: Personalization layer for LLM apps, raised a $5.35M Pre-Seed.

• Portia AI: AI agents manager with controls, raised $5.8M.

• Potato: AI agents for scientific experimentation, raised a $4.5M Seed.

• RecommenderX: AI-powered service platform for businesses, raised $8.75M.

• Redcar: AI B2B sales research and outreach tool, raised a $5.3M Seed.

• Riza: Secure environment for AI-generated code, raised a $2.7M Seed.

• RLWRLD: Foundation model for robotics, raised a $14.8M Seed.

• Scout AI: Vision-language AI for defense robots, raised a $15M Seed.

• Spur: AI agents to test website for bugs, raised a $4.5M.

• Tezi: AI recruiting agent named Max, raised a $9M Seed.

• Telli: Voice agents for B2C customer service, raised a $3.6M Pre-Seed.

• TheStage AI: AI platform for model fine-tuning, raised a $4.5M Seed.

• Virtue AI: Security platform for AI systems, raised $30M.

• Youlify: Generative AI for medical billing, raised a $4.3M Seed.