Welcome back to Friday Equity!
We kick things off with the Deal of the Week. First up, xAI. Elon Musk has once again proven that his name alone can shake up the investment world, raising a staggering $6 billion for his AI startup. Despite Musk’s rocky history with some of his ventures, investors like a16z and Sequoia can’t seem to resist pouring money into his latest project. The valuation of $18 billion is a testament to his continued influence, even as skeptics (such as — ahem — your podcast hosts) question the wisdom of betting big on Musk’s latest AI ambitions.
Next on our Deal of the Week roster is Solutions by Text. This Dallas-based company, which has been bootstrapped for over a decade, secured $110 million in funding. Their innovative approach allows users to pay bills and apply for loans via text messaging.
Lastly, we have WeatherXM, a company bringing web3 into the weather forecasting space. It raised $7.7 million in a Series A round led by Faction, a blockchain-focused fund. WeatherXM is creating a decentralized network of weather stations, offering open source data to improve weather predictions. As you’ll hear on the podcast, the company’s unique approach even won over our trio of web3 skeptics!
Theme of the week: The Synapse collapse
Shifting gears, we dove into the Synapse collapse. This fintech disaster has left many startups and consumers scrambling. Synapse, a banking-as-a-service (BaaS) provider, filed for Chapter 11 bankruptcy after a failed acquisition deal with TabaPay.
The collapse has caused significant disruptions, leading to companies like Copper to discontinue banking operations and MainVest to shut down all together. The Equity team muses on what this means for BaaS as an industry — and how worried we ought to be overall.
So, what’s up with IPOs this year?
Finally, let’s talk IPOs. The year started with high hopes, but the market has since cooled. Major players like Plaid, Stripe and Figma have pushed back their IPO plans, citing various reasons, from macroeconomic conditions to the looming election year.
Despite some successful IPOs earlier in 2024, the landscape remains uncertain. Investors and companies alike are waiting for clearer skies, which might not come until after the election. Until then, perhaps the secondary markets will come to the rescue?
That’s a wrap for this week! Don’t forget to rate and review Equity on Apple Podcasts, Spotify or your preferred podcast platform. Stay tuned for our next episode, and don’t miss out on our sister show, Found, where Becca dives deep into the stories behind startups with the founders who built them.
Have a great weekend, everyone!
