Top tech startup news for Wednesday, March 1, 2023: Amazon, Binance, Ether.fi, OpenAI, Ring, and Waymo
Good evening! Below are some of the top tech startup news stories for today Wednesday, March 1, 2023.
Jamie Siminoff, the founder and CEO of Amazon Ring, is stepping down from the role later this month
Jamie Siminoff, the CEO of Amazon subsidiary Ring, is stepping down from the role later on March 22, the company announced in a blog post on Wednesday. Siminoff’s role will shift to that of chief inventor while Elizabeth Hamren who recently served as COO of the chat app Discord, will succeed him as CEO.
“Invention is my true passion. I am constantly looking at how we can adapt to deliver for our neighbors, which is what we’ve always called our customers,” Siminoff wrote in a blog post. “This is why I decided to shift my role to Chief Inventor and bring on a new CEO.”
In addition to becoming the new Ring CEO, Hamren will also oversee Amazon Key, the company’s in-home delivery service; shared network service Amazon Sidewalk; as well as Blink, another maker of home security cameras that Amazon acquired in 2017. Before now, Hamren held multiple executive roles at Microsoft including the Xbox division and Meta’s Oculus virtual reality unit.
Amazon acquired Ring.com five years ago for over $1 billion. Siminoff started Ring in 2013 when he went on ABC’s “Shark Tank” to pitch his company Doorbot. He pitched his idea, a WiFi-enabled doorbell that allows you to see video of and talk to people as they arrive at your front door.
However, the “Sharks” were not impressed with his product. All but Kevin O’Leary (Mr. Wonderful) passed. Mr. Wonderful however made an offer that Siminoff considered an unacceptable offer. What a difference 5 years make. The company later changed its name to Ring.com. Ring went on to raise over $209.2 million in total funding, according to CrunchBase.
Crypto investors withdrew about $6 billion from Binance’s stablecoin after the US crackdown on the exchange
In December, Binance ‘temporarily paused’ withdrawals following the outflow of $1.9 billion from the world’s largest crypto exchange. Immediately after the withdrawal, Binance CEO Changpeng Zhao (CZ) took to social media to calm down investors that the outflow was not the highest withdrawal Binance had processed. “Yesterday was not the highest withdrawals we processed, not even top 5,” Zhao said.
Now, it appears the bleeding hasn’t stopped. According to the latest data from market tracker CoinGecko, Binance’s stablecoin, Binance USD, has seen around $6 billion of outflows following a U.S. regulatory crackdown on the company that issues the token.
As we reported earlier this month, Paxos Trust Company, which issues Binance USD, was ordered by New York regulators to stop minting Binance stablecoin BUSD. On the same day, the U.S. Securities and Exchange Commission (SEC) also told the company it should have registered the product as a security and is considering taking action against the platform.
Binance USD is a stablecoin that acts largely as a gateway between the crypto and the US dollar. The value of Binance stablecoin has plummeted in recent months losing about $4 billion in just two weeks alone. According to market tracker CoinGecko, the value of all Binance USD was around $10.5 billion on Wednesday, down from $16.1 billion on Feb. 13.
Web3 startup Impossible Cloud soars with $7.6M in seed funding to revolutionize the decentralized cloud storage
Despite funding to web3 startups plummeting 74% in Q4 of 2022, Hamburg, Germany-based Impossible Cloud just closed a $7.6M seed round, including backing from prominent investors that was co-led by HV Capital and 1kx, and joined by Protocol Labs, TS Ventures, and very early Ventures.
In addition to capital contributed by the founders, the heavily oversubscribed Seed round brings the company’s funding to date to more than €10 million (approximately $10.9 million). Impossible Cloud will use the funding proceeds to accelerate the market entry of its cloud storage solution, which will bridge the gap between traditional and web3 businesses.
Led by Kai Wawrzinek, Christian Kaul, and Daniel Baker, Impossible Cloud is taking a different approach to decentralized cloud storage. The company offers a revolutionary cloud platform that offers decentralized, multi-service cloud solutions that supports an almost unlimited capacity of storage.
The Impossible Cloud team has a proven track record in helping to build publicly traded unicorn companies, including Goodgame Studios, Stillfront, Airbnb, and Iron Mountain. Impossible Cloud has already garnered significant interest from potential customers and is working closely with leading SaaS providers to integrate their services into the platform.
Its platform is designed for 100% durability and without any single point of failure, guaranteeing 99.95% availability above industry standard. Additionally, it can provide access to a global network of enterprise-grade storage hubs, enabling reliable performance and efficiency near the customer’s edge.
Impossible Cloud claimed to be the first decentralized, enterprise-grade cloud platform offering a comprehensive suite of services backed by a fiat-based payment system and business model catering to B2B customers. This new approach delivers the key benefits of web3 technology, including increased speed, affordability, and security, without the need to transact with tokens or cryptocurrency.
Today, ether.fi, a non-custodial and decentralized liquid staking protocol, announced it has raised $5.3 million in a funding round led by North Island Ventures and Chapter One, with participation from Node Capital, Arrington Capital, Maelstrom, Version One Ventures, and Purpose Investments, among other investors. etherFi will use the funding proceeds to expand its team and pursue more partnerships.
ether.fi addresses existing ETH staking issues around centralization and composability. Instead of stakers in other delegated staking protocols being matched with a node operator who generates and holds the staking credentials, as a decentralized non-custodial staking solution, ether.fi allows stakers to retain control of their keys while delegating validator operations to a node operator.
ether.fi brings a new platform approach to the staking market. Minting an NFT representation of every validator generated through its protocol, to allow for the storage of validator metadata, ether.fi intends to unlock new use cases and long-term value creation for developers building on staking infrastructure.
In a statement, ether.fi said that Ethereum stakers depositing a minimum of 32 ETH will hold the NFT, which represents the economic interest in the validator. Once the NFT liquidity pool and the protocol treasury management contracts are implemented and launched, ether.fi will enable fractionalization via the launch of its eETH Liquid Staking Derivative token, for liquidity pool individual stakers with more than 0.1 ETH. Additionally, stakers and node operators will benefit from ether.fi’s decentralized protocol by providing them with economic exposure to revenue derived from services built on the staking infrastructure.
In a blog post, Node Capital said: “ether.fi is committed to upholding the decentralized principles of the cryptocurrency world. To ensure that the entire crypto community stays true to these principles, it’s imperative that we all continue to educate and emphasize the values and logic behind Web3 principles,”
ether.fi said its liquidity staking protocol is launching on March 4 at ETHDenver, following the successful Ethereum Shapella upgrade on the Sepolia testnet today.
South Korean AI chip startup Sapeon is raising a new funding round at a $400 million valuation to challenge Nvidia
The AI race is here and companies like OpenAI and Microsoft are going to need a new generation of AI chips to meet the computational demands. While companies like Nvidia, AMD, and Intel are currently dominating the AI chip market with chips used for artificial intelligence, new breeds of AI chip startups are raising millions in funding to challenge the chip giants. Two of these companies are South Korean startups Sapeon and Rebellions.
Sapeon is a South Korean artificial intelligence chip startup that spun out of its parent company, SK telecom. Based in California, Sapeon (a compound word of “SAPiens,” which means mankind, and aEON, which means eternal time) was created in 2016 inside SK Telecom, one of South Korea’s biggest telecommunications firms. Last year, SK Telecom spun out Sapeon and raised outside investment.
Now, Sapeon is raising a new funding round that puts its valuation above $400 million, CEO Soojung Ryu told CNBC in an interview. The startup is currently backed by high-profile South Korean firms including SK Telecom, memory-chip maker SK Hynix and SK Square, an investment company spun off from SK Telecom.
Sapeon designs AI-powered semiconductors for data centers. Unlike traditional chips, these AI chips are required for AI applications that require huge amounts of data processing. Sapeon and established players like AMD are looking to challenge Nvidia and get a piece of the AI chip market share.
Alphabet’s Waymo has laid off another 137 employees in its second round of job cuts this year, bringing total cuts for the year to 200, or 8% of its workforce after the company reported its initial job cuts in January. In a statement, the company said it eliminated some engineering roles as part of the cuts to “focus on commercial success.” The company has now laid off a total of 209 jobs so far this year.
A Waymo spokesperson also said the job cuts are part of a broader organizational restructuring that follows a “fiscally disciplined approach.”
Waymo’s layoffs follow a massive job cut at Google’s parent Alphabet in January after the tech giant announced it cutting about 12,000 jobs or 6% of its workforce. The cuts affected affect a large number of employees who support Google’s experimental projects including is health science unit, Verily Life Sciences.
The announcement is the latest in a series of job cuts in the tech industry. Just yesterday, Twitter laid off 10% of its workforce, reducing its total headcount to less than 2,000.
Last month Zoom announced it was laying off 15% of its workforce, or about 1,300 employees as its stock fell from its peak of $559 to $85. A day earlier, Dell announced plans to lay off 6,650 workers. In January, Google also said it plans to lay off more than 12,000 workers, while Microsoft revealed it plans to cut 10,000 employees and Salesforce announced plans to lay off 7,000 workers.
With just two months into 2023, more than 428 tech companies have laid off 120, 422 tech workers, according to Layoffs.FYI, a site that has been tracking all tech layoffs using data compiled from public reports.
ChatGPT has become a worldwide phenomenon, further pushing artificial intelligence (AI) into the mainstream. In less than three months, the OpenAI’s chatbot reached 100 million monthly active users in January, making it the fastest-growing consumer application in history. ChatGPT could do virtually everything from writing poetry, and correcting coding mistakes with detailed examples, to generating AI art prompts.
However, a year before the launch of ChatGPT, OpenAI’ acquired one of the internet’s most expensive real estate assets: AI.com. The sale was first reported by the domain industry news site DomainInvesting.com. According to the report, Saw.com, a domain brokerage firm, reported that it sold AI.com “to someone in the NFT space” for $11 million, making it one of the top 10 most expensive domains ever sold.
“When I saw AI.com had transferred to a different domain registrar, I reached out to Saw.com’s Jeff Gabriel and Amanda Waltz to see if the domain name had sold. Jeff responded to my query and confirmed that AI.com has been sold by FMA. Although the purchase price is not going to be announced, I understand the asking price for AI.com was $11 million. Jeff told me it was sold “to someone in the NFT space,” DomainInvesting.com founder Elliot Silver said in a blog post.
The identity of the buyer was not revealed until a few days after the launch of ChatGPT when AI.com redirected to https://chat.openai.com/chat, further confirming that OpenAI was the buyer.
While you may be thinking OpenAI overpaid for the domain, the ChatGPT-maker recently received a reported $10 billion in additional funding from Microsoft in exchange for a 49% stake in the company. However, there’s something interesting about the $11 million sales price.