The latest edition of Startups Weekly offered a roundup of significant events from the startup sector, emphasizing that creative accounting is not exclusive to Hollywood. While some expectations were not met, others were exceeded, as startups progressed on various commitments, including advancements in nuclear reactors and small electric vehicles.
In the startup news of the week, there was a mixture of outcomes, including both the completion and delay of public exits, alongside various developments that were both promising and disappointing.
TechCrunch reported issues with 11x, revealing that several companies displayed as customers on its website were not actual clients. The startup, backed by a16z and Benchmark, was also highlighted for employing unconventional methods to calculate annual recurring revenue.
Cerebras Systems faced further delays with its IPO due to an ongoing national security review, despite initially filing to go public in 2024. Meanwhile, Terrestrial Energy, a U.S. nuclear startup, successfully went public through a SPAC merger, anticipating a return of $280 million. In parallel, Commonwealth Fusion Systems, backed by Bill Gates, achieved an important milestone for its demonstration reactor.
However, Plenty, a vertical farming company, filed for bankruptcy despite accumulating nearly $1 billion in investments from notable entities like SoftBank, Walmart, Bezos Expeditions, and angel investor Jeff Bezos. Additionally, Block, founded by Jack Dorsey, reduced its workforce by 931 employees, following prior layoffs in 2024, as confirmed by a leaked email.
In acquisition rumors, Nvidia is reportedly close to acquiring Lepton AI, a startup specializing in AI-powered server rentals, while FuriosaAI, a chipmaker for AI applications from South Korea, reportedly declined an $800 million acquisition proposal from Meta.
On the funding front, digital banking startup Mercury raised $300 million in funding, which more than doubled its valuation. Island, an enterprise browser company, secured $250 million at a significant valuation increase. Also, a new micromobility startup spun out from Rivian, received $105 million, aiming to produce small EVs.
The Berlin-based workflow automation startup n8n raised $60 million, positioning its valuation close to $270 million. Mendel, a Mexico City-based startup, raised $35 million in a Series B round, targeting profitability by late 2025. Arcade, a generative AI marketplace, announced a $25 million Series A funding and expansion into home goods.
Former Outreach CEO Manny Medina’s new startup, Paid, raised $11 million in pre-seed funding to ensure compensation for AI agents. Emergence Capital, based in San Mateo, closed a $1 billion fund focused on AI-driven B2B companies. French VC firm Daphni secured $215 million for the first closing of their third fund, Daphni Blue.
Furthermore, Amazon’s Alexa Fund broadened its investment focus beyond voice startups, incorporating a wider interest in AI solutions.
Lastly, a report introduced the world’s 20 most promising open source startups, predominantly featuring companies with AI at their core. Further details and the full list are available online.
