This week's biggest tech news

By 20VC

Categories: VC, Startup

Summary

Capital One buys Brex for $5.15B, but 1x returns suggest missed opportunity. Anthropic's exploding costs challenge the AI margin story, while Andreessen Horowitz sets new records, powering two-thirds of private AI revenue.

Key Takeaways

  1. Late-stage investors in Brex's acquisition received at least a 1x return, suggesting the company could have fetched a higher price if the deal was delayed.
  2. Anthropic is seeing 23% higher than expected inference costs, which could weaken the AI margin story if costs don't bend, despite their high revenue per employee.
  3. Andreessen Horowitz invested $8B in 2022, beating previous records, and their portfolio companies generated two-thirds of private AI revenue.
  4. The successful IPO of EquipmentShare, a profitable company, suggests the public market window is opening, while Wealthfront's $1.2B market cap raises questions about the bar for going public.
  5. The TikTok deal is finally closed, with US investors now owning 80% of the company, while the Chinese entity retains control of the algorithm, which accounts for only 8% of ByteDance's business.
  6. Capital One's acquisition of Brex at 7x ARR suggests they saw significant value in the company, despite the deal being viewed negatively by the public.

Topics

Transcript Excerpt

Five of the biggest bits of tech news this week. Capital One buys Brex for 5.15 billion. The internet didn't love it. The truth is latestage investors got at least a 1x back. Mickey Maler at Ribbit made a ton of money. Why combinator did very well. The real question is actually they bought it at 7x ARR. If they waited longer, they could have definitely got a higher price. That's an interesting question. Second on the agenda, the Tik Tok deal is finally done. It is over. US investors will now own...