7 OCTOBER | LONDON 2024
SEPTEMBER 12TH - 14TH
The O2, LONDON
Future of Capital Allocation
Your weekly newsletter on the fast-evolving world of investing
How to use AI to find your next investment
AI investment frenzy has gripped the startup world. But with concerns about bloated valuations growing and customer interest waning, some are asking whether the AI boom is simply a trillion-dollar tech bubble.
The week's developments in investing & technology, explained
Reading time: ~5 minutes
We examine the “carnage” that the technology could wreak upon wealth management, as a new survey suggests that one in six firms will be put out of business by AI investors.
This week’s briefing also highlights other emerging industries that are capturing investors' attention, from mixed reality to longevity. Would you pay to extend your dog’s life? A new startup backed by the founder of Spotify is betting on it.
Explore these stories and more — including why Europe’s seed-stage funding is in freefall and how gen-AI investment has revitalised big tech — in our CogX Must-Reads.
—Charlie and the Research & Intelligence Team
💸 Big tech investment is back, thanks to the generative AI boom
Google, Meta, Microsoft, Apple and Amazon plan to invest billions in AI, in hopes that the technology will help them revitalise their ageing product lines. But when will generative AI start impacting the bottom line?
🤖 Five questions investors should be asking generative AI founders
With AI investment booming, there’s pressure to act quickly — but it’s crucial that investors do their due diligence. Here are the questions they should ask AI founders, such as: What is your unfair advantage? Are you automating – or adding value?
How AI is transforming investing
💬 For impact investors, deep-tech is the next frontier
Deep-tech ventures focus on the application of areas like AI, synthetic biology and advanced materials, and often leverage relationships with — and funding from — government and academia. 97% of US deep-tech firms are working on contributing to at least one of the UN’s Sustainable Development Goals.
🚀 AI will bring “carnage” to wealth management
A new PwC survey predicts that one in six asset and wealth management firms will be bought or shut down in the next five years as AI-powered investing becomes more prevalent. Vanguard, Schwab and Fidelity are among the US firms already offering AI investing services.
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Startups
🦄 The AI gold rush has gripped the startup world — but fears of a bubble are growing
Venture capitalists have poured billions into AI start-ups on spec, but there are growing concerns that valuations may be frothy, with the road to profitability unclear for many companies. AI is costly to build and run, and there are signs that consumer interest is waning: ChatGPT use is on the decline.
🛑 Seed-stage funding in Europe plummeted by almost half in July
Funding was down to £325 million last month, from £603 million in June. These were 218 rounds last month, of which 55 were closed in the UK. While some drop-off at the height of summer is expected, this year’s is more severe than we’ve seen previously.
Jobs
•Managing Director | Cooperative AI Foundation | Remote, UK | £80-100k
•Founder Associate | Cleo | London | £70-100k
•Senior Finance Analyst | twentyAI | London | £65-75k
•Head of Partnerships | AI For Humans | Berlin | £86-110k
•Financial Controller | Clarity for AI | Madrid | £40-60k
•Senior Associate, Investors | Anthos Capital | Santa Monica | £108-173k
•VC Associate | Bain Capital Ventures | San Francisco | £150k
•Venture Creation Lead, Fintech | Diagram Ventures | Montreal | £130-150k
The investment ecosystem
Noteworthy deals
Series A+
•Elon Musk’s controversial brain chip startup Neuralink has raised £220m in Series D funding led by Peter Thiel’s Founders Fund.
•Lab-grown meat startup Meatable raised £27.5m in a Series B funding led by Agronomics. With EU regulation currently prohibiting the sale of cultivated meat, the Dutch startup plans to launch its sausage and pork dumpling products in Singapore and the US.
•US-based Protect AI raised £23.5m in Series A funding led by Evolution Equity Partners to boost its AI security tools. This funding is more than double the amount Protect AI raised in its seed round.
Pre-seed & seed
•Israeli startup Chargelow raised a £8.6m seed round led by OpenView Venture Partners to build AI that fights chargeback fraud.
•German AI startup Flower raised a £2.8m pre-seed from First Spark Ventures, Factorial Capital, Betaworks, and Pioneer Fund. Flower trains models without giving the AI direct access to data, theoretically making it safer when privacy or compliance are concerns.
•UK at-home fertility treatment startup Bea Fertility raised £2.5m in seed funding from Octopus Ventures, QVentures and Calm/Storm Ventures.
Undisclosed:
•Ed-tech unicorn GoStudent raised £75m for its AI- and VR-enhanced tutor marketplace from Deutsche Bank, Left Lane Capital, and others.
•German space-tech firm Rocket Factory Augsburg raised £25.8m in convertible bond investment from KKR.