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This week we talk about Wiz's bold decision, a public VC feud, new capital in Legal Tech, and a16z's precarious situation. Let's get started!
The most interesting startup stories of the week
Wiz says no to Google.: Turning down a $23 billion acquisition offer from a search giant wasn’t an easy decision for the fast-growing, four-year-old cybersecurity startup that was valued at $12 billion in May. “It’s hard to turn down such a modest offer, but with our incredible team behind us, I feel confident in making that choice,” Wiz CEO Assaf Rappaport wrote in a letter to employees. The company is currently targeting a $1 billion ARR milestone by 2025 and an IPO, but Rappaport didn’t provide a timeline for a potential listing. Read more
Cohere beats generative AI competitors.: Cohere, a Canadian startup that builds language models for specific businesses rather than consumer applications, has raised $500 million at a $5.5 billion valuation. As of the end of March, the company was generating $35 million in annual revenue, up from about $13 million by the end of 2023, according to Bloomberg. Cohere may be growing fast, and investors are clearly willing to pay for that growth. The valuation is 157 times ARR, to be exact. Read more
VCs See Opportunity After CrowdStrike Shutdown: In 2024, a buggy software update shouldn’t take down many of the world’s most critical computer systems. But some VCs say a new startup could be the one to make sure it never happens again. Read more
Reviving a 10-year-old drama: VC David Sachs and Rippling founder Parker Conrad got into a public spat over X, with many in Silicon Valley’s elite taking sides. The accusations poured in, and sides were chosen. VCs generally try to be friendly to founders, but such public feuds can be damaging to the industry’s reputation. Read more
The most interesting fundraising activities of the week
Until recently, startups haven’t been particularly successful at selling technology to the legal profession. But times are changing. We saw two legal tech deals this week.
Legal growth and profitability: Clio, a Canadian software company that helps legal practices run more efficiently with cloud-based technology, was founded 16 years ago. It finally seems to be hitting its stride. This week, it raised a $900 million Series F at a $3 billion valuation, nearly doubling its valuation in 2021. The profitable company has also grown its ARR from $100 million to $200 million two years ago. Clio’s growth has been fueled by its built-in payments and AI offerings. Read more
Harvey's case: Two-year-old legal AI pilot Harvey has raised a $100 million Series C led by GV at a $1.5 billion valuation, up from $715 million in December. While investors are betting big on Harvey’s future, lawyers may be wary of using it broadly because of its “language model’s propensity for spewing out toxicity and fabricated facts,” writes Kyle Wiggers at TechCrunch. Read more
Keep everything up to date: Vanta, a company that helps enterprises maintain security and compliance, just raised $150 million in a Series C at a $2.45 billion valuation. The six-year-old company started out helping small businesses get certified, but now wants to become a key security partner for large enterprises. Read more
Avoid tricky prompts: Lakera, a Swiss startup that protects AI applications from malicious prompts and other threats, has raised a $20 million Series A. The company’s software protects language models from prompts that could force them to reveal personal information. Read more
The most interesting VC and fund news of the week
a16z's precarious situation: A security researcher has exposed a major flaw in the a16z website that could have resulted in the leak of sensitive company data. The researcher found that the bug allowed access to emails and passwords. Fortunately for the prominent VC company, the flaw was quickly patched and no data was compromised. Read more
VCs are still pouring capital into AI: Generative AI startups are on track to surpass the impressive $21.8 billion in funding they raised last year, according to new data from Crunchbase. Read more
finally
Eric Zhu, 17, launched Aviato, a platform that analyzes private market data, from a high school bathroom, aiming to compete with private market intelligence giants PitchBook and Crunchbase. Read more
