7 OCTOBER | LONDON 2024
SEPTEMBER 12TH - 14TH
The O2, LONDON
Future of Capital Allocation
Your weekly newsletter on the fast-evolving world of investing
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Will AI cause a market meltdown?
Facing plummeting valuations, fintech entrepreneurs have criticised the UK for its complex regulations, high listing fees, and lack of clarity on open banking’s future. In response, the UK has launched a fintech fund that will invest £10-100 million in growth-stage companies. Can the promise of capital stop fintechs from listing overseas?
Meanwhile, we’re seeing a dramatic drop in billion-dollar valuations: just 21 new unicorns were minted in Q1 2023. Less than half of these make physical products, highlighting a new focus on emerging technologies. Read on for a list of last quarter’s most active investors, how to speak CTOs’ language, and a tool that matches startups with suitable investors.
—Charlie and the Research & Intelligence Team
🚀 The UK’s fintech fund
The UK Government launched a fund backed by Mastercard, Barclays, and the London Stock Exchange that will invest £10-100 million in growth-stage fintechs at Series C or above. Recently, fintech execs have slammed the UK for its bureaucracy, slow progress on open banking and high cost of going public.
🦄 Unicorns are a rare sight these days
In 2021, more than two unicorns were minted per day. That rate has dropped by 90%, with just 21 new unicorns reported in Q1 2023. Globally, some 2,700 companies have a valuation of $1 billion or more.
How AI is transforming investing
🤖 AI could cause the next crash
The chair of the SEC warns that rogue black box algorithms could spark a market meltdown. Beyond trading, the opacity of models is a concern given the input they have in judging people’s creditworthiness.
💰 An investing framework for LLMs
London venture capitalists Mosaic Ventures lay out their investment thesis: fund products that solve hard, economically valuable problems at scale with exceptional models.
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Startups
📈 The year’s biggest IPO
As competition heats up for the chips required to run AI models, UK chip designer Arm filed for a Nasdaq listing at a valuation of £52 billion.
✈️ Foreign founders flee UK
Immigrants make up less than 15% of the country’s population, but 39% of the UK’s fastest growing companies have a foreign-born founder. That figure has dropped 10% since 2019.
Jobs
•Sales Director, Embedded Finance | Lloyds | London | £98-129k
•Head of eCommerce Sales | bodo | London | £85-95k
•Enterprise Account Executive | V7 | London | £220-260k
•Director of Business Development | Mastercard | Amsterdam | £121k
•VP, Global Sales | Lodgify | Barcelona | £127k
•Analyst | futureland ventures | Remote, US | £32k
The investment ecosystem
Noteworthy deals
Series A+
•Digital wallet provider BitGo has raised £78m in Series C funding from undisclosed investors.
•Lundus Health, a UK startup focused on streamlining the clinical trial process, has raised a £14m Series A from investors including Creandum and Peter Thiel.
•Phasecraft, a UCL spinout focused on developing quantum algorithms, raised a £13m Series A led by Playground Global.
Pre-seed & seed
•US Telehealth startup Dr. B raised £6.3m in a seed round led by Lerer Hippeau, Founders Fund and others.
•Israeli sales discovery platform Demoleap raised £3.5m in a seed round led by Bonfire Ventures and Differential Ventures.
•DeckMatch, an AI startup that screens out irrelevant pitch decks for VCs, raised a £860,000 pre-seed round led by Alliance VC.
Undisclosed:
•Hugging Face raised £158m in a round led by Salesforce. Its valuation is now over £3 billion — more than 100 times its annual revenue.
•Scottish drug discovery startup BDD raised £2m from the British Business Bank, Archangels and Scottish Enterprise.