Anthropic, Databricks & the AI Power Shift

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∆ Tech in the News

CBDC in 12-24 Months? - Global bank transfer network SWIFT is launching a new central bank digital currency (CBDC) platform to connect the “wave of CBDCs” now in development globally.

Federal AI Rules - The White House announced new rules for federal agencies to ensure AI tools don't harm the public, including requirements to appoint chief AI officers, report on AI use, and set up sufficient safeguards.

“Absolutely Incredible” - Apple teased major AI announcements for its June dev-con WWDC which could include an AI App store, and AI tools in iOS 18, like an updated Siri and AI Messaging features.

"Not a trivial risk" - FTX co-founder Sam Bankman-Fried will stay in prison for 25 years for his role in the fraud and theft of $8B from customers in 2022.

GPT Rewards - OpenAI's GPT store starts rewarding a trial group of custom GPT builders with a usage-based revenue rewards pilot.

The Hottest Thing in Tech this Week

Anthropic, Databricks & the AI Power Shift

OpenAI’s days as King of Generative AI may be numbered, with a double whammy of Anthropic and Databricks dropping powerful models competing with (or exceeding) ChatGPT-4. Anthropic‘s Claude 3 Opus LLM surpassed GPT-4 for the first time on the LMSYS Chatbot Arena leaderboard. The good week continued with Amazon completing its $4B investment with a juicy $2.75B.

Databricks, however, came out of the blue with the most powerful open-source LLM yet, outperforming GPT 3.5 and other open-source models, including Claude 3 (not GPT-4 or Opus though). Developed with its recently acquired MosaicML dev team, the 132B parameter DBRX‘s stats are epic:

• Uses Mixture of Experts (MoE) method pioneered by Mistral AI

• 2x faster and 1/2 the cost of Meta’s Llama 2 LLM

• Trained on 3K Nvidia H100s with weights released

• Available via the Databricks API

• Can fine-tune on custom data on databricks cloud

A Power Shift

Both the Claude 3 and DBRX results augur a shift away from OpenAI’s hegemonic stage as more models reach a similar level, and importantly more open-source options emerge. The battleground will instead shift to layers of customization and fine-tuning for widespread enterprise integration. Data, App, and software layers, and Cloud infrastructure for LLMops are becoming almost more important than the model itself. Databricks, Amazon, Microsoft, and other big cloud players have an obvious competitive edge in this regard.

Check, Your Move

How will OpenAI fight back? Sam Altman has hinted at two groundbreaking model releases this year with GPT-5 expected mid-year. Also, a new leak suggests a new free GPT-3.5 model with multimodal “vision” capabilities may be coming soon. No doubt Sam still has some Aces up his sleeve to play.

Deals We’re Watching

Founders to Watch and Opportunities to Catch

Open Deals:

Looking to invest? Let us know if you want a warm intro —> [email protected]

1. Cargo Air Transport Innovation - - Building autonomous electric aircraft offering 30x more cargo space and reducing costs by half. Trucking pilot 2024. Direct 3PL integration with ongoing validation with UPS, Walmart, DHL. Backed by clean-tech accelerators. (Seed)

2. Urban Drone Delivery - Leader in urban BVLOS drone operations. Over 20,000 flights in dense cities. Licensed in US, Mexico, and other nations. $55k/month MRR – leased drone fleets. Strong contract pipeline. (Series A)

3. Biofabrication for Longevity - Germany - 3D printing of human tissues for longevity. Pilots with Bayer and others. Low seven figs in contract revenue for 2024. Multiple patents and grants received with more pending. (Venture)

4. Plant-Based Meat - EU - Notable European VC leading the round, with follow-on from seed investors including Unovis. (Series A)

5. Enterprise Workflow Solution - UK - Productivity software to drive compliance and streamline operations with mobile and wearable integrations. Longterm contracts with top-tier clients like Bayer, Petrofac, and Goodyear. (Seed+)

Raising for your startup? Send us your Open Round —> [email protected]

Closed Deals:

Observing AI - CA. startup Observe raised $115M at ~$400-500M valuation to build observability tools for AI data, backed by strategic partner Snowflake.

Human AI - NY startup Hume AI, raised $50M from Union Square, Comcast, LG and Nat Friedman & Daniel Gross for its API for empathic LLMs. 

Computer Vision - Pa. startup Gather AI closed a $17M Series A-1 round to scale its automated inventory and AI-powered warehouse monitoring tools.

Software for Smart Machines - NY Cloud-based open-source software platform developer Viam closed a Series B at $45M backed by Union Square.

AI Accounting Platform - NY startup Nominal raised a $9.2M seed to automate accounting, financial reporting, and multi-entity consolidation.

Companies to Watch:

“Photonic Fabric” - Santa Clara’s Celestial AI closed a $175M Series C for its optical tech for AI computing infrastructure offering 25x more bandwidth and 10x less latency and power use. Backers include U.S. Innovative Technology Fund, AMD, Koch, Temasek, IAG, Samsung, & Porsche.

Nears Unicorn Status - New York SMB-focused cybersecurity startup Coro’s revenue is up 300% in the last year, and it just raised a $100M Series D at over $750M PMV to expand internationally, starting with Europe.

Scaling Up - Accel, an early backer of San Fran image and text labeling startup Scale AI, is in talks to lead a “hundreds of millions” raise at a valuation up ~80% to ~$13B. Scale sells its services to OpenAI and other notable startups.

The Funding Buzz

Mad Capital - Boulder firm targets $50M for its Perennial Fund II to fund transitions to regenerative organic farming via tailored loans. Backed by the Rockefeller and Schmidt Family Foundations.

Dcode Capital - D.C. firm received $19M for its debut fund target of $30M to back tech startups to break into government contracting. Backed by Silver Lake, Sequoia, Accel, Kleiner Perkins, a16z, Founders Fund, GV, & Lightspeed.

Accel - The Palo Alto early-stage VC is reshaping its’ Indian Accelerator to limit it to just 8 startups and narrow its focus to: AI and Smart Manufacturing.

Trending Tools and Buzzy Tech

Trending Tools

Oracle - Added 200+ free AI tools to NetSuite for finance, accounting + more.

Copilot - Adds unified Teams transcripts and chats + inline image editing.

Adobe - GenStudio band-safe comms, Firefly updates + copilot integration.

Buzzy Tech

Graviton - Possible particle of gravity detected in a semiconductor.

"Distribution Matching" - MIT method speeds up AI image generators by 30x.

DeepMind - ‘Superhuman’ AI excels in fact-checking, cost saving and accuracy.

That’s a wrap! If you would like to connect with any of the candidates or startups we are speaking with, reach out.

Candidates —> [email protected]

Startup Founders —> [email protected] 

And If you are a founder and raising money, make sure to reach out. We are making hundreds of intros every month to real investors.