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If you’ve been following this newsletter, you’ll notice that I’ve been somewhat interested in AI – especially generative AI. I’m probably not the first person to make this observation, but the AI is painfully average. I think that’s kind of their goal – train them in all the knowledge, and the mediocrity will emerge.
The trick is to only use AI tools for things you’re not good at yourself. If you are an experienced artist or writer, it will let you down. However, the truth is that most people are not great writers, so ChatGPT and its counterparts will be of great benefit to workers everywhere. Well, until we collectively discover that a house cleaner has more job security than an office manager or secretary, at least.
On that cheery note, let’s sniff the startup bushes and see what delicious morsels we can scare from the depths of the TechCrunch archives from last week. . . .
Okay, okay, let’s start with artificial intelligence
I know this happens every damn week: I start with the intention of writing this newsletter without climbing into the AI swamp, and every week, you all continue to read our AI news as if your livelihood depends on it. Because, well, it’s entirely possible for that to happen, I guess.
The GPT Store, introduced by OpenAI, allows developers to create custom conversational models based on GPT and sell them in a new market. This initiative is designed to expand the accessibility and commercial use of AI, similar to how app stores revolutionized software distribution. Developers can not only build their own AI creations, but can also monetize them, opening a new path for AI innovation and entrepreneurship. Naturally, this simple update — and the platform is now capable of reading PDF files and websites — poses a major threat to startups that previously filled this gap in ChatGPT offerings, especially those whose business models depend on such features. It’s a reminder that building a business around another company’s API without a sustainable, standalone product is probably not the smartest business move.
AI, of course, isn’t just for startups. During Apple’s Q4 earnings call, the company’s CEO, Tim Cook, emphasized AI as a core technology and highlighted recent AI-driven features like Personal Voice and Live Voicemail in iOS 17. He also emphasized that Apple is continuing to develop AI technologies Generative – clearly, without revealing details.
Heinlein would be horrified: Elon Musk announced that Twitter Premium Plus subscribers will soon get early access to xAI’s new AI platform, Grok, once it exits early beta, making the chatbot a feature of the platform’s $16-per-month ad-free tier of service.
Brother, can you do without the GPU?: AWS introduced Amazon Elastic Compute Cloud (EC2) and Capacity Blocks for ML, a new service that enables customers to rent Nvidia GPUs for a specified period, primarily for AI tasks such as training or experimenting with machine learning models.
From Zero to AI Founder in One Easy Bootstrap: In “How to Bootstrap an AI Startup” on TC+, Michael Koch advises founders on maintaining control over their startup’s strategy and products through bootstrapping — yes, even in the often capital-intensive world of AI startups.
The rocky ocean of venture-backed startups
WeWork, once a successful startup valued at $47 billion, has filed for Chapter 11 bankruptcy protection, highlighting the stunning collapse. The company, which has more than $18.6 billion in debt, has won approval from about 90% of its lenders to convert $3 billion of debt into equity in a bid to improve its balance sheet and address costly leases. At TC+, Alex observed what we knew all along: that the underlying business didn’t make sense.
And in other project news. . .
Former Twitter CEO raises third venture fund: Advisors, the venture firm founded by former Twitter executives Dick Costolo and Adam Payne, has secured $395 million in capital commitments for its third fund, which aims to invest in Series B startups focused on business software and fintech services.
Happy 10th Unicorn Day: Alex remembers the 10-year anniversary of the term “unicorn,” which was initially coined here at TechCrunch, to describe startups valued at more than $1 billion.
You get a slice! You get a slice!: In response to the shortage of AI chips, Microsoft is updating its Startup Support Program to provide selected startups free access to advanced Azure AI supercomputing resources for developing AI models.
Let’s talk Sam Bankman Fried
Look, I’m not going to lie, I think most cryptocurrencies are dumb, and I’ve seen few startups using blockchain technology in a way that makes any sense at all — most of which would have done well with just a simple database procedure — so I’ve been following Jacqueline’s coverage of the Bankman-Fried trial. With a significant amount of schadenfreude. It’s normal to make mistakes, and startup founders are human, but if you’re scamming people, you deserve all the retribution you can get.
Sam Bankman-Fried was the co-founder and CEO of the cryptocurrency exchange FTX and the trading company Alameda Research (which was specifically named so that it did not sound like a cryptocurrency company). He was convicted on all seven counts of fraud and money laundering.
The charges related to a scheme that involved embezzling billions of dollars in client funds on deposit with FTX and misleading investors and lenders to both FTX and Alameda Research. After a five-week trial, the jury spent just four hours reaching its verdict.
The collapse of FTX and Alameda Research, which led to the indictment of Bankman Fried about 11 months ago by the US Department of Justice, was significant, with the executives allegedly stealing more than $8 billion of client funds.
He is due to be sentenced next March, but if he is beaten with the full weight of his actions, he faces a potential sentence of up to 115 years in prison.
Jacqueline did a heroic job covering TechCrunch’s experience, and it’s worth an afternoon to read it all — the details are amazing.
Top reads on TechCrunch this week
The house sometimes wins: Mr. Cooper, a mortgage and loan company, experienced a “cybersecurity incident” that led to an ongoing system outage. The company says it has taken steps to secure the data and address the issue.
I can’t think of any downsides to the Hindenburg: The world’s largest aircraft, Pathfinder 1, is a prototype electric airship developed by LTA Research and funded by Sergey Brin. It was unveiled this week, promising a new era in sustainable air travel.
Arrival departure: Electric Vehicle Startup Arrival, which aimed to revolutionize electric vehicle production through its microfactory model, faces severe operational challenges, including multiple layoffs, failure to meet production goals, and failure to comply with Securities and Exchange Commission filing requirements. , resulting in a sharp drop in valuation of $13 billion. .