Hey Founder, here are the latest tech news and insights:
- Grammarly acquires Coda to take on Notion
- Perplexity raises $9B
- GitHub launches free copilot
- B2B AI dominates VC funding
- Insights into Sifted’s H2 2024 report
- Product Management job market report
- The founder journey: raising $500K pre-seed
- Ilya Sutskever: AI's next big shift
GRAMMARLY ACQUIRES AI PRODUCTIVITY STARTUP TO TAKE ON NOTION
Grammarly has announced its acquisition of Coda, a productivity platform known for its innovative workspace solutions, marking a significant shift in Grammarly's focus towards becoming a comprehensive AI-native productivity suite. This acquisition was officially confirmed on December 17, 2024, and is expected to close in January 2025.
This acquisition positions Grammarly to compete more effectively against other productivity platforms like Notion. By leveraging Coda's advanced AI tools, Grammarly seeks to transform its writing assistant into a more versatile platform that can cater to complex business needs.
The CEO of Coda will become the CEO of Grammarly. The acquisition price for Coda is unknown, but a couple of years ago, the company was valued at $1.3 billion.
PERPLEXITY CLOSES FUNDING ROUND AT $9 BILLION VALUE
Perplexity AI has made it — the search startup secured $500 million in funding, tripling its valuation to $9 billion. Quite the leap, as planned: back in April, the company was valued at $1 billion, and by June, after investments from SoftBank Vision Fund 2, it had reached $3 billion.
Investors clearly see potential in reimagining online search through generative AI — or perhaps they’re just riding the hype wave.
Perplexity AI already boasts over 15 million active users. The company has also inked revenue-sharing deals with major publishers, including Time and Fortune, following plagiarism accusations from some media outlets. Notable backers include Amazon founder Jeff Bezos and NVIDIA.
However, not everyone is on board — News Corp., The New York Times, Forbes, and the New York Post are among the critics. Adding to the drama, the company’s CTO is set to testify in the U.S. Justice Department’s case against Google, appearing on both sides. The government aims to highlight the importance of forcing Google to open access to its data to foster competition, while Google plans to argue that competition already exists.
A GAME-CHANGER: GITHUB LAUNCHES FREE COPILOT VERSION
GitHub has launched a free version of Copilot, giving all 150 million developers on the platform access to 2,000 code autocompletions and 50 chat messages per month when using VS Code. To access it, simply sign in with your GitHub account.
The free version offers a choice between the Claude 3.5 Sonnet model from Anthropic and OpenAI's GPT-4o. Developers can ask questions about their code, get explanations of existing code, debug, and make edits across multiple files simultaneously. Additionally, third-party Copilot agents and the ability to create custom extensions are available.
Copilot Chat is now accessible directly from the GitHub dashboard and is functional with the free version. For students, teachers, and open-source project maintainers, unlimited free access to Copilot Pro remains available.
A nice holiday gift, although with some limitations. It’s also a strong move in the competition with paid VS Code alternatives like Cursor or the newly launched Windsurf by Codeium.
B2B AI DOMINATES VC FUNDING
Thinking of building a B2C AI startup? You might want to reconsider. Unlike previous tech booms led by giants like Amazon, Uber, and Airbnb, the spotlight in AI funding today is squarely on enterprise startups, according to the latest data from PitchBook.
So far this year, B2B AI startups have secured an impressive $16.4 billion in funding, compared to just $7.8 billion for B2C startups. The gap widens further in generative AI, where B2C funding amounts to a mere 6.4% of B2B’s total for 2024.
Is B2C AI doomed? Not quite. PitchBook projects the consumer AI market will outgrow the enterprise segment by 2032, doubling in size during the anticipated second wave of AI funding.
INSIGHTS FROM SIFTED'S 'H2 2024 VC REVIEW'
Sifted has compiled data on the European venture market for the year's second half in its latest report. The authors analyzed key niches where venture capital flows, areas that are declining, and the trends shaping the ecosystem.
Key takeaway: After a strong first half, the pace significantly slowed down.
Deal Volume
Sifted recorded 1,629 deals in the second half, a 29% drop compared to the first. This marks the lowest level since H2 2012.
Late-stage funding rounds fell by 52%, accounting for just 16% of the total funds invested in the ecosystem. Most deals in H2 were early-stage rounds — making up 87% of the total.
Deal Value
Funding volumes decreased by 32% compared to the first half of the year. The decline was primarily due to a drop in growth-stage investments (-29%) and late-stage investments (-55%).
However, investors remained more supportive of early-stage startups, where funding fell by only 21%. Early-stage deals accounted for 38% of total investments in H2.
Venture debt made up 36% of all funding in Europe this year, though its share slightly underperformed expectations after a strong rise in H1.
Mega Rounds
While H1 saw 92 mega-rounds, this number dropped to 45 in H2.
The largest deal in H2 was Poolside's €460M Series B round in July, while the largest early-stage round was Myricx Bio’s €105M Series A.
Sectors
The B2B SaaS segment showed resilience in H2, even surpassing H1 results (€4.9B vs. €4.8B).
This allowed the sector to overtake climate tech, which previously led the pack. Funding in climate tech and deep tech dropped by 47%, and in fintech by 43%.
Meanwhile, the average deal size in consumer tech grew by 97%, rising from €1.17M in H1 to €2.3M in H2.
High-Growth Niches
Out of the 98 sectors tracked by Sifted, energy software and wellbeing startups led growth in H2, with deal volumes increasing by 217% and 73%, respectively.
Other notable increases in average deal size include:
Insurtech: +229%
Water and marine tech: +202%
Climate analytics: +160%
Proptech: +157%
Developer tools: +145%
Construction tech: +124%
The steepest declines were seen in digital banking startups (-72%) and CFO tech (-69%).
Countries
Four countries surpassed €1B in venture capital raised in H2:
- UK: €5.5B
- Germany: €3.1B
- France: €2.6B
- Switzerland: €1B
All countries except Germany saw a minimum 30% decline compared to H1.
Germany maintained growth thanks to Munich, which outperformed Berlin in venture funding in 2024.
REID HOFFMAN’S ADVICE
Reid Hoffman recently shared a great reminder: if you're too comfortable with your first product version, you’ve probably waited too long to launch. The key to success is quick iteration, learning from feedback, and not letting the fear of flaws hold back progress – perfection can come later.
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ACCELER8 AFRICA
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EARLY-STAGE ROUNDS FROM THE TOP VOICES
Datapad, co-founded by Cem Ruso and Orkun Soylu, raises $500k to transform data analytics with AI; German startup NAO, co-founded by Robin Binder, Amel Hasanovic, and Philipp Nowakowski, secures a €3.4m investment to expand access to alternative investments in Europe; Dutch real estate tech company Next Sense, led by Ferdinand Grapperhaus (CEO), Enrico Rosa (CPO), and Pim Rutgers (CTO), lands a €11.5M round to drive global decarbonization in real estate.; Belgium-based Powernaut, co-founded by Florentijn Degroote and Serge Morel, raises €2.4m to revolutionize energy management; RapidCanvas, co-founded by Rahul Pangam and Uttam Phalnikar, secures $16m to transform AI adoption through automated solutions; UK-based Embeddable, co-founded by Tom Gardiner and Harry Marshall, lands €6m to redefine embedded analytics for developers; British biotech Concinnity Genetics, co-founded by Jessica Birt and Dr. Matthew Dale, secures £3m to advance safe gene therapies.
THE LATEST PRODUCT MANAGEMENT JOB MARKET REPORT FOR DECEMBER 2024
A report shared by James Gunaca reveals a concerning trend in the Product Manager job market as the year ends.
Is what people say about an EOY hiring rush true?
The number of Product Manager jobs worldwide is down 13%.
This compares unfavourably to November 2024, where it was down 1.5%.
𝗥𝗲𝗴𝗶𝗼𝗻𝗮𝗹 𝗰𝗵𝗮𝗻𝗴𝗲𝘀
All regions saw job listings 𝙙𝙚𝙘𝙡𝙞𝙣𝙚 to start December. The US and UK saw the biggest 𝙙𝙚𝙘𝙡𝙞𝙣𝙚𝙨 at 15% and 13%. All other regions were down between 3-9%, including LATAM which saw strong growth in November.
𝗦𝗲𝗻𝗶𝗼𝗿 𝗣𝗠 & 𝗣𝗿𝗼𝗱𝘂𝗰𝘁 𝗟𝗲𝗮𝗱𝗲𝗿𝘀𝗵𝗶𝗽 𝗥𝗼𝗹𝗲𝘀
Job listings continue shifting towards Senior PM and Product Leadership roles (this is the 3rd month I've tracked this). While listings fell across PM, Senior PM, and Product Leadership roles, Senior PM listings decline were the least pronounced.
𝗥𝗲𝗺𝗼𝘁𝗲 𝘃𝘀. 𝗢𝗻-𝘀𝗶𝘁𝗲 𝘃𝘀. 𝗛𝘆𝗯𝗿𝗶𝗱
On-site jobs 𝙙𝙚𝙘𝙧𝙚𝙖𝙨𝙚𝙙 12% MoM, while Hybrid (-1%) and Remote (0%) remained stable. With 6 months of data, you can now see how this is trending globally in the full report.
AS A FOUNDER WHO RAISED A $500K PRE-SEED
Kevin Jurovich shared these valuable insights on LinkedIn, offering a candid look at the realities of fundraising for founders.
Here are my biggest (updated) takeaways:
𝟏. 𝐀𝐯𝐨𝐢𝐝 𝐰𝐚𝐬𝐭𝐢𝐧𝐠 𝐭𝐢𝐦𝐞 𝐰𝐢𝐭𝐡 𝐕𝐂𝐬 𝐭𝐨𝐨 𝐞𝐚𝐫𝐥𝐲
Unless you’ve had multiple exits or significant traction, don’t bother. Focus on your product and improve your metrics by talking to users. Early VC calls should focus on understanding the milestones you need to hit in the future. Don’t ask for money; instead, ask: “At what point would a business like ours be exciting to you?” They will tell you.
𝟐. 𝐒𝐭𝐚𝐫𝐭 𝐬𝐦𝐚𝐥𝐥
Don’t start by trying to raise venture capital. Too many founders think they’ll raise a $4M seed right off the bat — they won’t. Start smaller with angels or your personal network.
𝟑. 𝐅𝐮𝐧𝐝𝐫𝐚𝐢𝐬𝐢𝐧𝐠 𝐢𝐬 𝐭𝐨𝐮𝐠𝐡
For every successful round you read about on TechCrunch or LinkedIn, there are 50 others that flopped.
𝟒. 𝐃𝐨𝐧’𝐭 𝐭𝐚𝐤𝐞 𝐫𝐞𝐣𝐞𝐜𝐭𝐢𝐨𝐧 𝐩𝐞𝐫𝐬𝐨𝐧𝐚𝐥𝐥𝐲
I made this mistake early on. A "no" doesn’t always reflect poorly on your business. Sometimes investors lack funds and just won’t admit it.
𝟓. 𝐊𝐞𝐞𝐩 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐥𝐨𝐨𝐩
Once you get a few yeses, keep your current investors updated. Set expectations upfront and send regular updates. And don’t just rely on email — pick up the phone. Call them! Trust me, it can open unexpected doors.
𝟔. 𝐅𝐮𝐧𝐝𝐫𝐚𝐢𝐬𝐢𝐧𝐠 𝐭𝐚𝐤𝐞𝐬 𝐥𝐨𝐧𝐠𝐞𝐫 𝐭𝐡𝐚𝐧 𝐲𝐨𝐮 𝐭𝐡𝐢𝐧𝐤
Plan accordingly.
𝟕. 𝐁𝐞 𝐩𝐢𝐜𝐤𝐲 𝐚𝐛𝐨𝐮𝐭 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬
A difficult investor on your cap table isn’t worth a $25K check. We have 27 investors now, and none of them suck.
𝟖. 𝐌𝐨𝐦𝐞𝐧𝐭𝐮𝐦 𝐦𝐚𝐭𝐭𝐞𝐫𝐬
When you secure an investment, leverage that success to unlock more opportunities. Keep the momentum going while the iron’s hot.
𝟗. 𝐏𝐞𝐫𝐬𝐞𝐯𝐞𝐫𝐚𝐧𝐜𝐞 𝐢𝐬 𝐞𝐯𝐞𝐫𝐲𝐭𝐡𝐢𝐧𝐠
A non-successful fundraising round often looks just like a successful one at first — full of "no’s." The difference? Perseverance.
To all the founders fundraising — stay at it and don't lose hope.
THE VERGE: ILYA SUTSKEVER SAYS THE WAY AI IS BUILT IS ABOUT TO CHANGE
Ilya Sutskever, co-founder and former Chief Scientist of OpenAI, delivered a thought-provoking forecast at NeurIPS, one of the largest AI conferences, held in Vancouver. He suggested that the era of pre-training models on internet data may be nearing its end due to the finite nature of this resource. “The internet is a single entity; no new data will appear,” he stated, likening data to fossil fuel for AI training.
Sutskever predicted that the next generation of AI models will possess agency — the ability to make decisions and perform tasks autonomously. These systems will be capable of reasoning rather than simply matching patterns based on previously seen examples. However, he cautioned that as these systems develop reasoning abilities, they become less predictable, much like advanced chess AIs can confound even top grandmasters.
He also drew an intriguing parallel between the scaling of AI systems and evolutionary biology. Sutskever pointed out that the brain-to-body mass ratio of hominids, early human ancestors, is distinct from that of other mammals. He suggested that just as evolution discovered a new scaling pattern for hominid brains, AI might uncover novel approaches to scaling beyond the limits of current pre-training methods.
Written by Anna Lebedeva, the co-founder at The Top Voices and a startup ecosystem enthusiast.
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