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☆ Tensions Rise in Silicon Valley Over Sales of Start-Up Stocks
▼ + stars: | 2024-05-06 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

Sohail Prasad, an entrepreneur, launched a fund in March called the Destiny Tech100. The fund owns shares in hot tech start-ups like the payments firm Stripe, the rocket maker SpaceX and the artificial intelligence company OpenAI. Few people get the chance to invest in these privately held companies since their shares are not openly traded. Mr. Prasad’s intention with Destiny was to let the rest of the world get a piece of them through his fund. But soon after Destiny debuted, two tech start-ups — Stripe and Plaid, a banking service — said the fund did not legally own their shares.

Persons: Sohail Prasad, Destiny, —, Robinhood, Prasad, ” Organizations: SpaceX

☆ Start-Up Founder Sentenced to 18 Months in Prison for Fraud
▼ + stars: | 2024-04-19 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

Another start-up founder is going to prison for overstating his company’s performance to investors. His misrepresentations allowed him to raise $117 million in funding from top investment firms, valuing his start-up at $1.1 billion. When HeadSpin’s board members found out about the behavior in 2020, they pushed Mr. Lachwani to resign and slashed the company’s valuation by two-thirds. Mr. Lachwani is at least the fourth start-up founder in recent years to face serious consequences after taking Silicon Valley’s culture of hype too far. Other founders currently in prison for fraud include Sam Bankman-Fried of the cryptocurrency exchange FTX and Elizabeth Holmes and Ramesh Balwani of the blood testing start-up Theranos.

Persons: Manish Lachwani, Lachwani, Sam Bankman, Elizabeth Holmes, Ramesh Balwani

☆ Want to Invest in SpaceX or Stripe? There’s a Fund for That.
▼ + stars: | 2024-04-05 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

Stripe, a payments start-up, is one of the most successful companies to emerge from Silicon Valley in a generation. It is a problem that has vexed retail investors for years, as start-ups like Stripe, SpaceX and OpenAI soar to enormous valuations in the private market. Only so-called accredited investors with a high net worth are allowed to invest in private tech start-ups. It is offering a publicly traded fund that contains shares of 23 private tech companies including Stripe, SpaceX, OpenAI, Discord and Epic Games. Sohail Prasad, the chief executive of Destiny XYZ, the parent company of the fund, said his goal was to let anyone own part of the tech industry’s top private companies.

Persons: Destiny Tech100, Sohail Prasad Organizations: SpaceX, Games, New York Stock Exchange Locations: Silicon

☆ Inside a C.E.O.’s Bold Claims About Her Hot Fintech Start-Up
▼ + stars: | 2024-03-25 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

Ms. Yahyaoui’s compelling background helped her stand out among entrepreneurs when she moved in 2018 to San Francisco, where she founded a student aid start-up called Mos. The app hit the top of Apple’s App Store and Ms. Yahyaoui raised $56 million from high-profile investors, including Sequoia Capital, John Doerr and Steph Curry, according to PitchBook, which tracks start-ups. In podcasts, TV interviews and other media, Ms. Yahyaoui, 39, frequently discussed Mos’s success. But internal company data viewed by The New York Times showed that as of early last year, only about 30,000 customers had paid for Mos’s student aid services. Less than 10 percent of Mos’s roughly 153,000 bank users had put their own money into their accounts, the data showed.

Persons: Amira Yahyaoui, Yahyaoui, John Doerr, Steph Curry, Mos Organizations: Sequoia Capital, The New York Times, TechCrunch Locations: Tunisian, Algerian, San Francisco

☆ What’s in Our Queue? ‘Veep’ and More
▼ + stars: | 2024-03-20 | by ( Erin Griffith | ) www.nytimes.com time to read: 1 min

What’s in Our Queue? ‘Veep’ and MoreI’m a reporter covering tech start-ups and venture capital for The Times. I’m always a few years late to books, music and movies — and totally OK with that. Here are five things I’ve been enjoying lately →

Persons: ’, I’m, I’ve Organizations: The Times

☆ In Silicon Valley, Venture Capital Meets a Generational Shift
▼ + stars: | 2024-03-13 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

Reid Hoffman, a founder of LinkedIn and a longtime venture capitalist, is no longer the public face of the venture firm Greylock. Michael Moritz, a force at Sequoia Capital for 38 years, officially separated from the investment firm last summer. They are among the most recognizable of a generation of Silicon Valley investors who are getting out of venture capital at the end of a lucrative 15-year upswing for the industry. Investors at Tiger Global, Paradigm, Lightspeed Venture Partners, Emergence Capital and Spark Capital have all announced plans to step back. Foundry Group, a venture firm in Boulder, Colo., that has backed 200 companies since 2006, said in January that it would not raise another fund.

Persons: Reid Hoffman, Michael Moritz, Jeff Jordan, Andreessen Horowitz Organizations: LinkedIn, Sequoia Capital, Tiger Global, Lightspeed Venture Partners, Spark, Foundry Group, Apple, Google Locations: Silicon, Boulder, Colo, —

☆ Silicon Valley Venture Capitalists Are Breaking Up With China
▼ + stars: | 2024-02-21 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

DCM Ventures, a Silicon Valley venture capital firm, began investing in China’s start-ups in 1999. The move reaped such blockbuster returns that in 2021, DCM said it planned to “double down” on its strategy of investing in China, the United States and Japan. DCM’s messaging is one example of an industrywide shift happening between Silicon Valley investors and Chinese start-ups. The about-face stems from the tense relationship between the United States and China as they jockey for geopolitical, economic and technological primacy. The countries have engaged in a trade war amid a diplomatic rift, enacting tit-for-tat restrictions including U.S. moves to curb future investments in China and to scrutinize past investments in sensitive sectors.

Organizations: Ventures, China’s, The New York Times Locations: Silicon, China, United States, Japan, South Korea

☆ Inside the Funding Frenzy at Anthropic, One of A.I.’s Hottest Start-Ups
▼ + stars: | 2024-02-20 | by ( Erin Griffith | Cade Metz | ) www.nytimes.com time to read: 1 min

Last May, Anthropic, one of the world’s hottest artificial intelligence start-ups, raised $450 million from investors including Google and Salesforce. By August, Anthropic had landed $100 million from two Asian telecoms. Then Amazon committed $4 billion to it, followed by $2 billion more from Google. This month, the venture capital firm Menlo Ventures closed a deal to invest $750 million in Anthropic. Its five funding deals stood out not just for their speed and size, but for their unusual structures.

Persons: Anthropic Organizations: Google, Menlo Ventures Locations: Anthropic

Apple | Spotify | Amazon | YouTube Listen and follow ‘Hard Fork’Bluesky, the Twitter spinoff, is now open for public sign-ups. Can its dreams of decentralization fix social media? We talk with the company’s chief executive, Jay Graber. Then, the New York Times reporter Erin Griffith on how Adobe’s failure to acquire Figma has spooked tech companies and upset Silicon Valley’s start-up pipeline. And finally, updates on ancient scrolls and artificial intelligence, Google’s chatbots, and the fight between record companies and TikTok.

Persons: Jay Graber, Erin Griffith, Figma, Google’s chatbots Organizations: Apple, Spotify, YouTube, New York Times

☆ After Its $20 Billion Windfall Evaporated, a Start-Up Picks Up the Pieces
▼ + stars: | 2024-02-08 | by ( Erin Griffith | ) www.nytimes.com time to read: +1 min

On Dec. 18, a $20 billion deal by Adobe, the software giant, to buy Figma, a San Francisco start-up darling, fell apart after more than a year of regulatory scrutiny. In a blog post that day, Dylan Field, Figma’s chief executive and co-founder, painted an optimistic picture of what would come next. Behind the scenes, the start-up, a design platform, is picking up the pieces. In recent weeks, Figma said it had reset its internal valuation to $10 billion — half of what Adobe planned to pay for it. Figma is also grappling with a tech industry that has been changed by a frenzy over artificial intelligence.

Persons: Dylan, “, ”, Figma, Michael Amodeo Organizations: Adobe Locations: San Francisco

☆ American Firms Invested $1 Billion in Chinese Chips, Lawmakers Find
▼ + stars: | 2024-02-08 | by ( Ana Swanson | Erin Griffith | ) www.nytimes.com time to read: +1 min

A congressional investigation has determined that five American venture capital firms invested more than $1 billion in China’s semiconductor industry since 2001, fueling the growth of a sector that the United States government now regards as a national security threat. Funds supplied by the five firms — GGV Capital, GSR Ventures, Qualcomm Ventures, Sequoia Capital and Walden International — went to more than 150 Chinese companies, according to the report, which was released Thursday by both Republicans and Democrats on the House Select Committee on the Chinese Communist Party. The investments included roughly $180 million that went to Chinese firms that the committee said directly or indirectly support Beijing’s military. That includes companies that the U.S. government has said provide chips for China’s military research, equipment and weapons, such as Semiconductor Manufacturing International Corporation, or SMIC, China’s largest chipmaker. The report by the House committee focuses on investments made before the Biden administration imposed sweeping restrictions aimed at cutting off China’s access to American financing and technology.

Persons: Walden International —, Biden Organizations: —, GSR Ventures, Qualcomm Ventures, Sequoia Capital, Walden International, Republicans, Democrats, Chinese Communist Party, Semiconductor Manufacturing International Corporation Locations: United States

Mr. Altman plans to launch the initiative with his longtime partner and co-founder Greg Brockman, OpenAI’s former president who stepped down in solidarity with Mr. Altman on Friday, said the people, who spoke on the condition of anonymity because the plans for the new company are not yet public. Details on the potential company are scarce, because Mr. Altman and Mr. Brockman are still working through what it will be. Plans could change quickly, as the pair are keeping a wide range of options open, the sources said. OpenAI’s board of directors shocked the tech industry on Friday when it abruptly fired Mr. Altman from his position as chief executive. By Friday night, the two men were already working on their plans to pitch investors on their next venture.

Persons: Sam Altman, Altman, Greg Brockman, OpenAI’s, Brockman Organizations: OpenAI

Sam Altman and Greg Brockman, two top executives at OpenAI who left the company after a dramatic board meeting on Friday, are talking again with board members about returning to the artificial intelligence start-up, two people with knowledge of the matter said. The discussions follow an outcry after Mr. Altman, 38, was ousted from his role as OpenAI’s chief executive. Since then, OpenAI’s investors and Mr. Altman’s supporters have pressured the board members of the start-up to bring Mr. Altman back, six people with knowledge of the situation said. There is no guarantee that Mr. Altman or Mr. Brockman will be reinstated at OpenAI, the people said. work is done — the company’s investors have no official say in what happens to the start-up or who leads it.

Persons: Sam Altman, Greg Brockman, Altman, Altman’s, Brockman Organizations: OpenAI, Microsoft Locations: OpenAI

Sitting beneath a palm tree on a cliff above the ocean at Mr. Benioff’s Hawaiian home in 2018, they explained both devices. “This one,” Mr. Benioff said, pointing at the Ai Pin, as dolphins breached the surf below, “is huge.”“It’s going to be a massive company,” he added. They experimented in secret with hardware components and built a virtual assistant, like Siri or Alexa, working with customized language models based, in part, on OpenAI’s offerings. The device’s most sci-fi element — the laser that projects a text menu onto a hand — started inside a box the size of a matchbook. It took three years to miniaturize it to be smaller than the size of a golf tee.

Persons: Mr, Benioff, “, ”, Siri, Altman Organizations: Apple

☆ Can A.I. and Lasers Cure Our Smartphone Addiction?
▼ + stars: | 2023-11-09 | by ( Erin Griffith | More About Erin Griffith | ) www.nytimes.com time to read: +1 min

Slowly, I circled my wrist to scroll, pressing an index finger and thumb together in a pinching motion to select an item. The gadget, called the Ai Pin, is a new take on wearable devices that aims to supplant, or at least help wean us off, our addiction to screens. It took a few seconds of waving my hand in front of my chest to find the laser menu. The circling wrist motion takes a second to nail as well. In 10 minutes of wearing the device at the company’s offices, I gradually learned how to hold the light and manipulate it.

Persons: ”

☆ Silicon Valley Shrugs Off Sam Bankman-Fried’s Trial
▼ + stars: | 2023-11-02 | by ( Erin Griffith | More About Erin Griffith | ) www.nytimes.com time to read: +1 min

In the four weeks that Sam Bankman-Fried, the founder of the FTX cryptocurrency exchange, was on trial on fraud charges, the tech industry:Reacted to the war in Israel and Gaza, including protesting a tech conference organizer’s social media posts about the conflict. Buzzed over a manifesto from a top venture capitalist outlining a list of enemies to technological progress. Scrambled to invest money in the hottest artificial intelligence company, OpenAI, at triple its valuation earlier this year. Hotly debated the new features on Threads, a social media site owned by Meta. But a simpler answer could be that the tech industry has again done what it does best: move on to the next thing.

Persons: Sam Bankman, Bankman Organizations: Meta Locations: Israel, Gaza, FTX

And when Robert Van Winkle, better known as Vanilla Ice, sang his 1990 hit “Ice Ice Baby,” flanked by 10-foot sparklers, he pulled the Sugar Ray frontman Mark McGrath onstage. This was Cameopalooza 2021, a company retreat celebrating the meteoric rise of Cameo, an app and website where regular people could buy personalized videos from minor celebrities for as little as $1. Three hundred Cameo employees danced, took videos and basked in their good fortune to be a part of the Cameo “Fameo” — the company’s nickname for its employees and community of celebrities. A former collegiate party promoter, he shared the lifestyle of Cameo’s celebrity talent, jet setting between parties, sporting events and luxury homes in Miami, Los Angeles, and Chicago. Cameo had just raised $100 million on the audacious ambition to pioneer the “connection economy,” landing a $1 billion “unicorn” valuation just a few years into its existence.

Persons: Kenny G, Paula Abdul, Hamilton, Lance Bass, Robert Van Winkle, Ray, Mark McGrath, Jack Harlow, Steven Galanis, Cameo Organizations: Chicago, Hilton Locations: American, partied, Miami , Los Angeles, Chicago

Initial public offerings are back, warts and all. After a two-year dearth of new listings, shares of the grocery delivery company Instacart closed their first day of trading on Tuesday at $33.70, up 12 percent from their initial public offering price of $30. The performance signaled that investors were eager to take a chance on young tech companies — but only at the right price. But even with the early stock price pop, the company’s valuation remained a far cry from the $39 billion that investors assigned it in the private market in 2021. “The markets will always ebb and flow,” she said, adding that she was more focused on what she could control.

Persons: Fidji Simo

Instacart on Monday priced its shares at $30 each for its initial public offering, at the top of its expected range, in a sign of renewed demand for tech stocks. The San Francisco-based grocery delivery company had estimated that its shares would be priced at $28 to $30 a share. Instacart raised $660 million in the offering and was valued at $9.9 billion, significantly below its last private fund-raising round in 2021, which valued the company at $39 billion. Many companies that raised money during the boom times of 2020 and 2021 have slashed their soaring valuations over the last year. Before last week, this had been the worst year for I.P.O.s since 2009, according to EquityZen, a marketplace for private stocks.

Persons: Instacart Organizations: Nasdaq, I.P.O.s Locations: San Francisco

When Fidji Simo took over as chief executive of Instacart in 2021, the grocery delivery start-up’s growth was cratering as its pandemic boom ebbed. Ms. Simo, a former executive at Meta with experience in advertising, played to her strengths. She also hatched a plan to sell software tools and other products to grocery companies to help improve shopping experiences, they said. Then she embarked on a good-will tour to visit the grocery companies and hosted their executives at her home in Carmel, Calif.As Instacart prepares to go public next week, it is a markedly different company. Envisioned in 2012 as a service that matched people at home with contract workers who would shop for them and deliver groceries, it has increasingly focused on advertising and software products as its delivery business has slowed.

Persons: Fidji Simo, Simo, Brands, Instacart Organizations: Meta Locations: Carmel , Calif

☆ The Stock Market Hopes for a Hit From the Year’s Biggest Initial Public Offering
▼ + stars: | 2023-09-14 | by ( Erin Griffith | More About Erin Griffith | ) www.nytimes.com time to read: +1 min

When shares of Arm, the British chip designer, begin trading on the Nasdaq stock exchange on Thursday in the year’s biggest initial public offering, investors, tech executives, bankers and start-up founders will be watching closely for how it performs. If Arm’s stock falls, they will know that the market for I.P.O.s is likely to stay frozen for longer. But a warm welcome for the shares could entice many more companies to go public in the coming months, ending the cold streak. Arm is the largest company to brave the public markets in 2023, a year that has been almost deathly quiet for I.P.O.s. The chip designer, which is owned by SoftBank, priced its offering on Wednesday at $51 a share, raising $4.87 billion and valuing the company at $54.5 billion.

Persons: ”, David Hsu Organizations: Nasdaq, Wharton School, University of Pennsylvania, SoftBank Locations: British

What if you built a new city from the ground up? Mr. Sramek, a former Goldman Sachs trader, had moved to the San Francisco Bay Area to make it in tech. He was a European immigrant smitten with the energy of local start-ups, but he preferred more walkable cities like Zurich. Soon, he began taking fishing trips to Solano County on the San Francisco Bay’s eastern edge. A rural corner of the county eventually became the centerpiece of a plan hatched by Mr. Sramek to build a city from scratch.

Persons: Jan Sramek, Sramek, Goldman Sachs, Flannery Organizations: San, San Francisco Bay Area, Flannery Associates Locations: San Francisco Bay, European, Zurich, Solano County, San Francisco, Silicon Valley

Apple | Spotify | Stitcher | Amazon | Google Listen and follow ‘Hard Fork’Are New York City’s new rules for short-term rentals like Airbnb effectively a ban? And will they accomplish what proponents want them to? Then, The New York Times tech reporter Erin Griffith on Silicon Valley’s mad dash for GPUs. And finally, we take stock of the A.I. songs of the summer and discuss YouTube and Universal Music Group’s plan to make synthetic voices profitable.

Persons: Erin Griffith Organizations: Apple, Spotify, York, The New York Times, Silicon, YouTube, Universal

In 2017, Michael Moritz, the billionaire venture capitalist, sent a note to a potential investor about what he described as an unusual opportunity: a chance to invest in the creation of a new California city. The site was in a corner of the San Francisco Bay Area where land was cheap. He painted a kind of urban blank slate where everything from design to construction methods and new forms of governance could be rethought. And it would all be a short distance from San Francisco and Silicon Valley. “Let me know if this tickles your fancy,” he said in the note, a copy of which was reviewed by The New York Times.

Persons: Michael Moritz, Moritz Organizations: The New York Times Locations: California, San Francisco Bay, Paris, New York, San Francisco, Silicon Valley

☆ The Desperate Hunt for the A.I. Boom’s Most Indispensable Prize
▼ + stars: | 2023-08-16 | by ( Erin Griffith | More About Erin Griffith | ) www.nytimes.com time to read: +1 min

In particular, Mr. Paoli needs a type of chip known as a graphics processing unit, or GPU, because it is the fastest and most efficient way to run the calculations that allow cutting-edge A.I. He’s tried making Docugami’s A.I. “I think about it as a rare earth metal at this point,” Mr. Paoli said of the chips. More than money, engineering talent, hype or even profits, tech companies this year are desperate for GPUs. The hunt for the essential component was kicked off last year when online chatbots like ChatGPT set off a wave of excitement over A.I., leading the entire tech industry to pile on and creating a shortage of the chips.

Persons: Jean Paoli, Paoli, he’s, He’s, Mr

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