AI Funding Weekly - Issue #7

The robots are taking over, and I dig it 🤖

Well just as we’re getting things ramped up with AI Funding Weekly, investors are sounding the alarm as global VC funding dips and down rounds are starting to pick up pace. At the same time, it was only a few months ago that TechCrunch wrote an article about how running an AI startup is the best way to avoid a down round…but those days might be coming to an end.

While The Information did write a bit of an overly dramatic headline, the down rounds are starting to come in and no, AI startups don’t seem to be immune. The reality is the monster valuations that we saw earlier this year are coming down, and fast.

In my opinion (and who the heck am I so take this with a grain of salt) I think the most prudent thing AI founders can do today is be careful with valuations. While you might find an investor that will write you a check pre-revenue at a bonkers valuation, know that you’ll need the revenue to back it up, and no, you won’t be able to raise at 20x revenue when you go back out there.

Once again, just my opinion, and I’m often wrong so you can ignore me…but if there was any time to use caution, now feels like the time. Speaking of time, enough time spent on my soapbox, let’s get to the good stuff. Here’s three AI startups enjoying some fresh funding this week.

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Grit - $7M

There’s a new startup in town, they’re called Grit, and they just came out of stealth mode with a fresh $7M in funding. While so many AI companies do things that sounds so fun and exciting, Grit does something that sounds a bit more boring, but might just be the most important - maintenance.

Git automatically analyzes a program’s codebase, tracks it over time, and then suggests updates to help engineering teams avoid building up too much tech debt.

“Traditionally, software engineering was very artisanal,” explained Grit CEO and cofounder Morgante Pell in a video interview with VentureBeat. “You have experts who go in with scalpels and modify code line-by-line. But what we’re seeing with generative AI is it’s much easier to generate new code. So we just need new tools that are able to move code at scale, like bulldozers.” (Source - VentureBeat)

As the CTO of an AI startup myself I’m signing up for the beta, we need this.

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Viome - $86.5M

I’ve been fascinated with microbiome research for some time now so when I found out there was a startup connecting AI with the microbiome I knew I had to include them in my newsletter.

This fresh funding is a Series C round for Viome, and was led by Khosla Ventures and Bold Capital.

As many people are starting to learn, understanding our microbiome can truly change your life, and Viome is using huge amounts of data to help people understand which foods and supplements your body needs. Here’s a quick rundown of how it all works:

In order to personalize your nutrition recommendations and health products, you'll start with one of our Intelligence tests. Based on millions of data points analyzed from your gene expressions, your action plan will focus on the root causes of microbial imbalance and inflammation.

The new round comes on the heels of a new deal with CVS which it’s safe to say is going to fuel some serious growth for Viome.

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Caden - $15M

Data sharing is a hot topic these days and Caden is jumping in to help consumers fine-tune what data they do share with third-parties.

“For 25 years, users have ‘exchanged’ their personal data for ‘free access’ to services, apps and websites, resulting in companies accumulating vast amounts of data without prioritizing user privacy,” he told TechCrunch in an email interview. “I envisioned a future where users would be empowered and placed at the center of this data exchange, rather than having it siphoned from them without consent.” (Source - TechCrunch)

The $15M Series A Round led by Nava Ventures brings Caden’s total funding to $24.4M.

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Okay, that’s a wrap, until next week - thanks for reading and remember, tell all your friends, every subscriber counts!