March 7th Newsletter

Before we unpack this week’s actions, click here for our deck highlighting the financials from selected public companies.

Turbulence continued as we entered the first week of March. S&P 500 was down 1.8% and the NASDAQ was down 2.6% as of close on Thursday following the ADP report indicating private sector job additions of 77,000 in February, below the forecasted 144,000 amidst tariffs concerns. Earlier in the week, new tariffs of 25% were implemented upon Canada and Mexico, with an additional 10% tariff imposed on Chinese imports. On Wednesday, a one-month tariff reprieve was announced for the automotive sector. A similar delay was announced on Thursday for most goods from Canada and Mexico until April 2nd. Nationwide's Chief Economist estimates that continued tariffs and corresponding retaliatory measures could constrain U.S. economic growth to approximately 1% in 2025. Military aid to Ukraine has been suspended this week to focus on peace negotiations. In corporate news, Walgreens finalized its $10 billion take private deal with Sycamore Partners amid ongoing financial restructuring and store closures. In the technology sector, Google is releasing a new experimental "AI Mode" in search that offers deeper reasoning, available to Google One AI Premium subscribers via Labs. 

Monthly AI Financing Report: Since January, we started sharing a monthly report of the top AI financing activity gathered from public and proprietary sources. See the latest release of February update here.

Top 5 AI Highlights

[1] 💰 Taiwan Semiconductor Manufacturing Co. (TSMC) will invest $100 billion to expand U.S. chip manufacturing, adding factories, packaging plants, and an R&D center in Arizona. The expansion supports U.S. efforts to secure semiconductor supply chains, especially for AI chips requiring advanced packaging to enhance performance. The move aligns with U.S. national security priorities, reducing reliance on Taiwan. Trump credited tariffs, but federal incentives like the CHIPS Act played the instrumental role. More from WSJ

[2] 🚧 OpenAI CEO Sam Altman announced that GPU shortages have delayed the rollout of GPT-4.5, requiring a staggered release. The new model comes at a premium cost, charging $75 per million input tokens and $150 per million output tokens—significantly higher than GPT-4. In addition, Altman proposed on X a flexible subscription model where users pay $20+ monthly for credits they can allocate across various AI features as needed. Lastly, the firm revealed plans for tiered AI agent services priced from $2,000 monthly for basic knowledge workers up to $20,000 for PhD-level research capabilities. These agent products are expected to generate 20-25% of the company's future revenue. More from TC, X and The Information.

[3] 🛒 Amazon is developing an advanced hybrid AI reasoning model under its Nova brand, expected to launch by June. Inspired by OpenAI’s o3-mini and DeepSeek’s R1, Nova aims to provide step-by-step logical responses for math, science, and complex questions. Designed for both enterprise and consumer applications, it features a hybrid architecture like Anthropic’s Claude 3.7 Sonnet, balancing between quick answers and deeper reasoning. Amazon also seeks to make Nova cost-efficient, though competing with DeepSeek’s aggressive pricing may be challenging. More from TC.

[4] 🕵️‍♂️ Salesforce has launched AgentExchange, a marketplace for Agentforce, enabling partners to build and monetize AI agent solutions. With 200+ partners—including Google Cloud and Docusign—it offers prebuilt AI actions and templates to accelerate enterprise automation. AgentExchange is now live, with templates arriving in April 2025. The launch follows Microsoft’s introduction of AI-powered sales agents in 365 Copilot, which help qualify leads, arrange meetings, and provide real-time sales insights by integrating with CRM data. More from MSFT, TM, and Salesforce.

[5] 🤖 Alibaba has introduced QwQ-32B, a new AI reasoning model it claims can compete with DeepSeek-R1. Despite having fewer parameters than DeepSeek, the model focuses on efficiency and excels in math and coding tasks. The announcement fueled optimism, with Alibaba’s Hong Kong-listed shares jumping 8.39% and the stock up nearly 71% YTD. CEO Eddie Wu emphasized AI-driven revenue growth in Alibaba’s Cloud Intelligence Group, which was a key driver of the company’s strong December-quarter profits. More from CNBC.

Founder’s Corner

AI enhancing the capability of existing employees

What We Read and Listened to This Week

• Firefly Aerospace successfully landed its Blue Ghost spacecraft on the Moon, marking the first flawless commercial lunar landing. (arstechnica)

• Intel won the dismissal of a shareholder lawsuit alleging it concealed $7 billion in foundry losses, which led to layoffs and a $32 billion market value drop. (Reuters)

• Discord is in early talks with bankers about a potential IPO, aiming for a public listing as soon as this year, though plans remain exploratory and subject to change. (NYT)

• Scale AI secured a multimillion-dollar deal with the U.S. Department of Defense for "Thunderforge," an AI-powered military planning program, partnering with Anduril and Microsoft to enhance decision-making and warfare automation. (CNBC)

• Y Combinator’s W25 cohort sees a major AI shift, with 25% of startups relying on AI-generated code for 95% of their codebases. (TC)

AI M&A and Fundraising news (Feb 28 — Mar 6)

• Alta: AI agents for sales and revenue operations, raised a $7M Seed.

• Anthropic: LLM research and AI safety firm, raised a $3.5B Series E.

• Ataraxis AI: AI-powered cancer prognosis and outcome prediction, raised a $20.4M Series A.

• Auxia: AI-driven customer data analysis platform, raised a $23.5M Series A.

• Caddi: "Record-to-code" automation platform, raised a $5M Seed.

• Cloudsmith: Cloud-native artifact management platform, raised a $23M Series B.

• Comet: AI-powered online freelance platform, raised a $10.41M round.

• Converge: AI-driven cyber insurance platform, raised $5M.

• CoRegen: AI-driven drug discovery platform, raised $30.75M.

• Copley: AI-powered content experimentation and optimization platform, raised $4.8M.

• CoreWeave: AI cloud computing startup, filed for an IPO that could raise $4B.

• Crogl: AI-powered “Iron Man“ suit designed to enhance security analysts’ capabilities, raised $30M.

• Dubformer: AI-powered dubbing technology, raised a $5.5M Seed.

• Endless: Cloud-based protocol development platform for web2 and web3, raised $110M.

• Epirus: AI-driven software-defined microwave technology developer, raised a $250M Series D.

• Exa: AI-powered search engine, raised a $20.59M Series A.

• Faireez: AI-powered hotel-style housekeeping services for condo owners, raised $7.5M.

• Faks: French healthcare AI SaaS startup, raised $6.6M.

• Firsthand: AI agents and chatbot platform for publishers, raised a $26M Series A.

• Freed: AI-powered medical record application, raised a $30M Series A.

• GRAID Technology: AI-based storage technology company, raised a $30M Series B.

• Hanyang Robotics: AI-powered intelligent service robots, raised $27.54M.

• Heidi Health: AI-powered clinical training and decision support tool, raised a $16.6M Series A.

• Helios Global Payments Solutions: AI-driven workforce management and payments platform, raised a $15.5M Seed.

• Intangible AI: No-code platform to simplify 3D content creation, raised 4M.

• Hema.to: AI-driven clinical support platform, raised a $3.75M Seed.

• Knostic: AI-driven risk management and governance platform, raised $11M.

• LlamaIndex: Custom knowledge agent builder for enterprises, raised a $19M Series A.

• MaxIQ: AI-powered revenue platform for sales teams, raised a $7.8M Seed.

• Momentic: AI-powered automated software testing platform, raised a $3.7M Seed.

• Peregrine: AI-powered decision and operations management platform, raised a $190M Series C.

• Prime Intellect: Decentralized AI platform for intelligence commoditization, raised $15M.

• Quantexa: AI-driven decision intelligence platform, raised a $175M Series F.

• Rune Technologies: AI-powered defense technology platform, raised a $6.19M Seed.

• Seadronix: Autonomous marine navigation control system, raised a $10.36M Series B.

• Shield AI: Autonomous vehicle platform for defense technology, raised $240M.

• Siatou Technology: AI-powered intelligent equipment products, raised a $9.65M Series A.

• Skyfora: Finnish AI-powered weather forecasting startup, raised $4.3M.

• Subscript: AI-powered billing and analytics software, raised a $15M Series A.

• Turing: Platform enabling engineers to contribute code to AI projects, raised a $111M Series E.

• Uniti: AI sales agents for real estate, raised a $4M Seed.

• Vermillio: AI licensing and protection platform, raised a $16M Series A.

• Viam: Engineering platform for data, AI, and automation, raised a $30M Series C.

• VIE Technologies: AI-driven industrial equipment health monitoring, raised a $15M Series A.

• Wealthcome: AI-driven wealth management platform, raised $7.29M.

• XUND: AI-powered medical API for digitizing the patient journey, raised $6.25M.

• Zeitview: AI and drone-based critical infrastructure inspection, raised $60M.

• Zhipu AI: Chinese AI LLM developer, raised $137.68M.