Is $500 billion enough?
Jan 22, 2025
Kaley Ubellacker
Market Stirrings 🚩
Here's what the week looked like in pre-seed:
$8.2M
5
Data aggregated from proprietary research and Crunchbase; valuation estimate based on 10-20% ownership stake.
BETTER GROW UP FAST?
2024 fundraising was up for growth and late stage startups compared to 2020 but remained down for early stage. Early stage dollars dropped 14% compared to 2020 and a staggering 52% compared to 2021. Comeback season might have to wait a while longer.
Good Reads 📖
For the rushed reader …
According to Crunchbase, funding jumped 43% in 2024 to $11.6 billion, driven by a few blockbuster rounds like Wiz’s $1 billion raise.
To help turn things around, Intel is spinning off its corporate venture arm, Intel Capital, into an independent fund by mid-2025, with Intel staying on as the anchor investor.
President Donald Trump has unveiled the $500 billion Stargate AI Project, a bold bet to make America the global leader in artificial intelligence.
For the less rushed reader …
FIREWALLS JUST GOT HOTTER: As it turns out, cybersecurity has quite the network. According to Crunchbase, funding jumped 43% in 2024 to $11.6 billion, driven by a few blockbuster rounds like Wiz’s $1 billion raise. But while the big checks are rolling in, the number of deals has dropped for seven straight quarters, showing that investors are getting pickier. With AI now stealing the VC spotlight, cybersecurity startups without an AI angle might find themselves locked out of funding in 2025. Whether this funding surge is a sign of a lasting shift or just a short-lived cyber chase before AI takes over remains to be seen.
MAKING BYTE-SIZED IMPROVEMENTS: Intel is still processing its misfortunes after experiencing its worst year since going public in 1991. To help turn things around, Intel is spinning off its corporate venture arm, Intel Capital, into an independent fund by mid-2025, with Intel staying on as the anchor investor. This move aims to give Intel Capital more autonomy and flexibility to attract external capital, aligning with Intel's broader strategy to streamline operations and recover from its $16.6 billion quarterly loss in 2024. Since its inception, Intel Capital has invested in over 1,800 companies, focusing on AI, 5G, and cloud tech. With rivals like Nvidia aggressively backing AI startups, let’s hope Intel’s spin-off helps it chip away at its troubles.
IS THIS $500 BILLION PROJECT TO GRIDDY?: A shocking development in current events: President Donald Trump has unveiled the $500 billion Stargate AI Project, a bold bet to make America the global leader in artificial intelligence. Kicking off with a $100 billion phase one, the initiative partners OpenAI, Oracle, and SoftBank to build an infrastructure of data centers across the U.S., promising 100,000 jobs and a massive tech boost. The project isn’t without its power struggles, requiring vast amounts of energy—likely more than Texas’ already strained grid can handle—and a highly skilled workforce. Unsurprisingly, Elon Musk has already thrown shade on X at SoftBank’s financial commitments. Stargate’s future depends on avoiding a gridlock of problems.
Fire Up the Pre-Seeds🔥
Highlights from this week’s pre-seed raises:
Fintech
Habits - An (AI)dvisor to find an advisor.
Habits raised $1.1 million led by Atlanta Ventures. Habits is helping millennials forget about skinny jeans and focus on finances instead with a matchmaking platform for finding financial advisors.
SaaS
Open - Getting personal with AI customer support.
Open raised $1.5 million from the Pioneer Fund, Propeller, and Y Combinator, among other investors. Open is building a fully AI-driven platform for customer support, targeting high-volume industries like banking and airlines.
Artificial Intelligence
LetsData - What the deep fake.
LetsData raised $1.6 million led by SMOK Ventures. By processing data from over 100 million websites and social media platforms, LetsData’s model addresses a critical security challenge: identifying the intent behind information operations.
Winrate - Ringing without reeling.
Winrate raised $1.2 million led by York IE. Winrate is developing an AI-powered platform that provides custom pre-call insights, eliminating the need for frantic meeting prep.
Outro🚪
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