Top tech startup news for Monday, February 27, 2023: Fifth Wall, Musk, OpenAI, Skydio, Snap, and Wiz
Good evening! Below are some of the top tech startup news stories for today Monday, February 27, 2023.
Elon Musk recruits team to develop OpenAI’s ChatGPT rival to fight ‘Woke AI’
Elon Musk has approached AI researchers in recent weeks about forming a new research lab to develop an alternative to OpenAI’s ChatGPT, the Information reported on Monday, citing two people with direct knowledge of the effort and a third person briefed on the conversations.
To spearhead the effort, The Information also reported that Musk has been recruiting Igor Babuschkin, a researcher who recently left Alphabet’s DeepMind AI unit and specializes in the kind of machine-learning models that power chatbots like ChatGPT. Babuschkin also told The Information in an interview that Musk’s objective is not to build a chatbot with fewer content safeguards
The report comes just a few months after Musk suggested last year that OpenAI’s technology was an example of “training AI to be woke.”
ChatGPT is a dialogue-based AI chat interface for its GPT-3 family of large language models. The mind-blowing ChatGPT is a successor to the Generative Pre-trained Transformer 3 (GPT-3), which is an autoregressive language model that uses deep learning to produce human-like text.
Musk, who co-founded OpenAI in 2015 but has since repeatedly criticized OpenAI for installing safeguards that prevent ChatGPT from producing text that might offend users.
Wiz, a three-year-old US-Israeli cybersecurity startup founded by engineers who sold their last company to Microsoft, announced it raised $300 million in private funding led by Lightspeed Venture Partners and existing investors Greenoaks Capital Partners and Index Ventures. Wiz will use part of the funding proceeds to open new offices in Austin, Dallas, and Washington D.C.
The latest round pushes the company valuation to $10 billion. Since its founding three years ago, Wiz has raised $900 million from investors, including Sequoia Capital, Insight Partners, Blackstone, and G Squared.
We covered Wiz back in 2021 after the company raised $250 million in a private funding round, more than tripling its valuation to $6 billion, making it a new member of the highly-coveted unicorn club. In just a few months, Wiz grew its employee count from 65 in March 2021 to over 650.
Wiz was co-founded in 2020 by four Israeli founders Yinon Costica, Ami Luttwak, Assaf Rappaport, and Roy Reznik. They sold their previous security startup company, Adallom, to Microsoft for a reported $320 million in 2015. It said its platform is used by 15% of Fortune 500 companies.
Wiz said the fresh funding was backed by most of the investors from its previous round including Sequoia Capital, Index Ventures, Insight Partners, Greenoaks, and Salesforce, with participation from CyberStarts, billionaire Bernard Arnault and Starbucks founder Howard Schultz.
Wiz analyzes the entire cloud environment to deliver a 360° view of security risks across clouds, containers, and workloads. The solution dives deep into risks with actionable, graph-based analysis, and all completely agentless. Investors are also paying close attention and opening their wallets to Wiz.
Wiz says its unique architecture allows for seamless scanning of a given organization’s entire cloud environment across all computer types and cloud services for vulnerabilities, configuration, network, and identity issues without agents or sidecars.
Fifth Wall Ventures closes a record $1.5B in new funds in 2022 to invest in real estate and PropTech startups
Fifth Wall announced today it closed a record $1.5 billion in new funds in 2022, bringing the firm’s total capital raised to $2.9 billion; the third most of any venture capital firm founded in the last five years. The news comes at a time when property tech startups face higher borrowing costs. The announcement is also a sign that major investors such as Fifth Wall are still bullish on real estate and PropTech startups despite rising interest rates by the Federal Reserve.
The $1.5 billion funds, which represent 64% of capital raised for dedicated PropTech funds, included an $866M Real Estate Tech Fund III, €140M European Fund, and $500M Climate Fund. the firm’s funds represent 64% of capital raised for dedicated PropTech funds. According to SEC Form D filings, Fifth Wall has raised the third-most capital of any venture firm globally ($2.9B) since 2016.
In addition to the $1.5 billion funds, a Fifth Wall affiliate also raised $620M between two SPACs, including FWAA, which completed a merger with the Fifth Wall portfolio company SmartRent in 2021, and FWAC, which announced a merger with Mobile Infrastructure Corporation in 2022.
During the period, Fifth Wall also announced it grew its team to 75 investment professionals across five offices in New York, Los Angeles, San Francisco, and London, and recently opened a Singapore office.
In addition to its PropTech funds, Fifth Wall recently started investing in Climate Tech to decarbonize the global real estate industry, raising $740M across early-stage and growth-stage funds. Separately, the firm launched its climate infrastructure strategy led by Alok Sindher. Fifth Wall is also today’s largest VC fund which is a certified B Corp.
Since the launch of its first $212M fund in May 2017, Fifth Wall has benefited from the explosive growth of PropTech and Climate Tech, which each now represent some of the largest venture capital categories. The firm became an early investor in many successful PropTech companies including Aurora Solar, VTS, and Lessen which recently acquired SMS Assist in the largest PropTech M&A transaction in history.
Skydio raises $230 million in funding for its AI-powered autonomous drones, valuation soars to $2.2 billion
Skydio, San Francisco-based AI-powered autonomous drone startup, announced today it has raised $230 million in Series E funding for the construction of a new manufacturing facility in America and to meet the rising demand for its autonomous drones across public safety, defense, and infrastructure inspection. The latest round brings Skydio’s total funding raised to $562 million with a current valuation of over $2.2 billion.
The round was led by Linse Capital, with participation from existing investors including Andreessen Horowitz, Next47, IVP, DoCoMo, NVIDIA, the Walton Family Foundation, and UP.Partners. Skydio also welcomed new investors Hercules Capital and Axon, a technology leader in global public safety and a key Skydio technology partner.
Founded in 2014 by Adam Bry, Abraham Bachrach, and Matt Donahoe, Skydio uses artificial intelligence to create flying drones that are used by consumers, enterprises, and government customers. Skydio is made up of leading experts in AI, robotics, cameras, and electric vehicles from top companies, research labs, and universities from around the world. Skydio designs, assembles, and supports its products in the U.S. Skydio is backed by top investors and strategic partners including Andreessen Horowitz, Linse Capital, Next47, IVP, Playground, and NVIDIA.
By transforming drones into intelligent devices that can dynamically understand and adjust to the environment in which they are operated, Skydio enables radically simpler flights and makes missions once considered impossible possible.
The introduction of the Skydio 2 in 2019 marked the beginning of an ambitious innovation agenda to take drones into the age of software and AI-based autonomy that will further accelerate in 2021 with the upcoming release of the new Skydio X2, recipient of CES’s 2021 Best of Innovation Award, and Skydio 3D Scan, the first-of-its-kind adaptive scanning software.
The sudden popularity of ChatGPT has sparked a new AI revolution as it dominates the headlines with no sign of slowing down. The world’s obsession with the OpenAI chatbot reaches a new level waves garnering over 100 million users in less than three months since its launch, causing tech companies including Microsoft to integrate AI-powered chatbots in its Bing browser.
The latest is Snap, the parent company of the social media platform Snapchat. Today, Snap announced it is rolling out an experimental chatbot rolling out an OpenAI-powered chatbot named My AI to some of its Snapchat+ subscribers. Snapchat+ was an advanced photo-sharing app announced in June and costs $3.99 per month.
In a news release, Snap said that My AI chatbot, which is based on the same underlying technology of Microsoft’s Bing AI, can recommend gift ideas, weekend plans, or recipes.
“Today we’re launching My AI, a new chatbot running the latest version of OpenAI’s GPT technology that we’ve customized for Snapchat. My AI is available as an experimental feature for Snapchat+ subscribers, rolling out this week. My AI can recommend birthday gift ideas for your BFF, plan a hiking trip for a long weekend, suggest a recipe for dinner, or even write a haiku about cheese for your cheddar-obsessed pal. Make My AI your own by giving it a name and customizing the wallpaper for your Chat,” Snap said.