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This week we talk about Wiz's bold decision, a public VC battle, new capital in legal tech, and a16z's close call. Let's get started!
This week's most interesting startup stories
Wiz Says No to Google: Turning down the search giant's $23 billion acquisition offer was not an easy decision for the fast-growing, four-year-old cybersecurity startup, which was valued at $12 billion in May. “It is difficult to turn down such a humbling offer, but our talented team gives me confidence in that choice,” Wizz CEO Assaf Rapaport wrote in a letter to employees. The company is currently on track to reach the milestone of $1 billion in annual recurring revenue and an IPO by 2025, although Rapaport did not say when the company might go public. read more
Cohere beats generative AI rivals: Cohere, a Canadian startup that builds language models for specific businesses rather than consumer applications, has raised $500 million at a valuation of $5.5 billion. The company had annual revenue of $35 million at the end of March, up from about $13 million at the end of 2023, according to Bloomberg. Cohere may be growing fast, and investors are clearly willing to pay a high price for that growth. The valuation is 157 times ARR, to be exact. read more
VCs see opportunity after CrowdStrike outageIn 2024, a single buggy software update probably won't be allowed to take down many of the planet's most critical computer systems, but some venture capitalists say the rise of new startups could be the way to ensure that never happens again. read more
A drama from 10 years ago is rekindled: VC David Sacks and Rippling founder Parker Conrad had a public spat about X, with many of Silicon Valley's elite taking sides. Accusations flew and sides were chosen. While VCs generally try to be founder-friendly, such a public spat can tarnish the industry's reputation. read more
Most interesting fundraisers this week
Until recently, startups haven't been particularly successful selling technology to the legal industry. But times may be changing. This week saw two legal tech deals.
Legal Growth and Profitability: Founded 16 years ago, Clio is a Canadian software company that helps legal practices run more efficiently with cloud-based technology. It looks like the company is finally getting back on track. This week, the company raised $900 million in Series F at a $3 billion valuation, nearly double the valuation it achieved in 2021. The profitable company also saw its ARR grow to $200 million from $100 million two years ago. Clio's growth accelerated thanks to its built-in payments and AI services. read more
Harvey's Case: Two-year-old legal AI co-pilot Harvey raised $100 million in a Series C led by GV, raising its valuation to $1.5 billion from $715 million in December last year. Investors are betting big on Harvey's future, but TechCrunch's Kyle Wiggers writes that lawyers may be reluctant to use Harvey widely, given “the language model's tendency to spit out harmful, fabricated facts.” read more
Stay on top of thingsVanta, a company that helps businesses stay secure and compliant, has raised $150 million in Series C funding at a valuation of $2.45 billion. Founded six years ago, Vanta started out helping small and medium-sized businesses get certified, but now wants to become the go-to security partner for large enterprises. read more
Preventing tricky prompts: Lakera, a Swiss startup that protects generative AI applications from malicious prompts and other threats, has raised $20 million in Series A. The company's software includes protections against prompts that could cause language models to leak personal information. read more
This week's most interesting VC and fund news
a16z's Close CallA security researcher exposed a critical flaw in the a16z website that could have exposed sensitive company data. The researcher discovered that the bug allowed access to emails and passwords. Luckily for the prominent venture capital firm, the flaw was quickly patched and no data was leaked. read more
VCs are still pouring money into AINew data from Crunchbase shows that generative AI startups are on pace to significantly surpass last year's already impressive $21.8 billion in funding. read more
Last but not least
In a high school bathroom, 17-year-old Eric Chu launched Aviato, a platform that analyzes private market data and aims to compete with private market intelligence giants PitchBook and Crunchbase. read more
