Great news — we're hosting another StrictlyVC event inside TechCrunch Disrupt on Tuesday, October 28, starting at 3 pm. Last year's off-the-record LP session was eye-opening; this year, as part of the program, we're letting LPs dissect your pitch in real time. Michael Kim and Kelli Fontaine of Cendana Capital, plus Adam Grosher from the J. Paul Getty Trust, will give three GPs unvarnished feedback on what works and what doesn't. Apply here to get the kind of feedback that could land you your anchor investor. (Stick around for the drinks and networking afterward.) — CL

Top News

Microsoft and OpenAI announced that they have reached a nonbinding agreement to extend their partnership, a fragile truce that could smooth OpenAI’s contentious bid to transform itself into a for-profit company in the face of opposition from both rivals and regulators. TechCrunch has more here.

Speaking of OpenAI, the company said its nonprofit parent will retain control of OpenAI and hold an equity stake in the startup worth more than $100 billion, effectively making it one of the richest philanthropies on paper. CNBC has more here.

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FTC Launches Inquiry Into AI Chatbot Companions From Meta, OpenAI, and Others

By Amanda Silberling

The FTC announced on Thursday that it is launching an inquiry into seven tech companies that make AI chatbot companion products for minors: Alphabet, CharacterAI, Instagram, Meta, OpenAI, Snap, and xAI.

The federal regulator seeks to learn how these companies are evaluating the safety and monetization of chatbot companions, how they try to limit negative impacts on children and teens, and if parents are made aware of potential risks.

This technology has proven controversial for its poor outcomes for child users. OpenAI and Character.AI face lawsuits from the families of children who died by suicide after being encouraged to do so by chatbot companions.

Even when these companies have guardrails set up to block or deescalate sensitive conversations, users of all ages have found ways to bypass these safeguards. In OpenAI’s case, a teen had spoken with ChatGPT for months about his plans to end his life. Though ChatGPT initially sought to redirect the teen toward professional help and online emergency lines, he was able to fool the chatbot into sharing detailed instructions that he then used in his suicide.

“Our safeguards work more reliably in common, short exchanges,” OpenAI wrote in a blog post at the time. “We have learned over time that these safeguards can sometimes be less reliable in long interactions: as the back-and-forth grows, parts of the model’s safety training may degrade.”

Massive Fundings

Nitricity, a seven-year-old startup based in Fremont, CA, that produces organic nitrogen fertilizer using renewable energy and agricultural waste, raised a $50 million Series B round co-led by World Fund and previous investor Khosla Ventures, with Chipotle’s Cultivate Next, Change Forces, Susquehanna Sustainable Investments, EIP, and Fidelity's Fine Structure Ventures also pitching in. ESG Today has more here.

NRG Therapeutics, a seven-year-old UK startup that is developing oral drugs to treat Parkinson’s and ALS by targeting mitochondrial dysfunction, raised a $67.9 million Series B round led by SV Health Investors’ Dementia Discovery Fund, with British Business Bank, M Ventures, Novartis Venture Fund, and Criteria Bio Ventures as well as previous investors Omega Funds and Brandon Capital also piling on. BioPharma Dive has more here.

Odyssey Therapeutics, a four-year-old Boston startup that is developing medicines to treat autoimmune and inflammatory diseases, raised a $213 million Series D round. Investors included Affinity Asset Advisors, Dimension Capital, Jeito Capital, Lightspeed Ventures, TPG Life Sciences Innovations, and Wedbush Healthcare Partners. The company has raised close to $700 million to date. More here.

Big-But-Not-Crazy-Big Fundings

Born, a three-year-old Berlin startup that makes AI companions meant to feel like friends and used in shared experiences, raised a $15 million Series A round from investors including Accel, Tencent, and Laton Ventures. The company has raised a total of $25 million. TechCrunch has more here.

Clockwork, a seven-year-old Palo Alto startup that makes software to synchronize GPU clusters and improve the efficiency of large-scale AI workloads, raised a $20.6 million round led by previous investor New Enterprise Associates, with Intel CEO Lip-Bu Tan, former Cisco CEO John Chambers, Carl Ledbetter, and e& Capital also participating. More here.

Noxilizer, a 21-year-old company based in Hanover, MD, that provides nitrogen dioxide sterilization for pharmaceutical, biotechnology, and medical device products, raised a $30 million round. NewVale Capital led the financing. More here.

Optain Health, a two-year-old New York startup that uses AI, robotic retinal imaging, and teleophthalmology to detect eye and systemic diseases at an earlier stage than traditional screening methods typically allow, raised a $26 million Series A round led by Insight Partners, with Memorial Hermann Health System, Northwell Health, Novant Health, The Ohio State University Wexner Medical Center, UPMC, Informed Ventures, Lumio Capital, Meridian Ventures, and the UniQuest Extension Fund also anteing up. The company has raised a total of $29.3 million. More here.

Pest Share, a five-year-old startup based in Nampa, ID, that provides on-demand pest control services for residential property managers, raised a $28 million Series A round led by Integrity Growth Partners, with previous investors MetaProp, Capital Eleven, and RE Angels also investing. More here.

TERN Group, a two-year-old Dubai and London startup that trains, certifies, and deploys healthcare professionals into high-demand markets, raised a $24 million Series A round led by Notion Capital and including EQ2 Ventures, RTP Global, LocalGlobe, Leo Capital, and Presight Capital. The company has raised a total of $33 million. Wamda has more here.

Smaller Fundings

Accordance, a one-year-old San Francisco startup that makes AI software for tax and accounting professionals, raised a $10 million seed round led by Khosla Ventures. The company also announced a $3 million pre-seed round led by General Catalyst, with Anthropic, NEA, Bain Capital Ventures, and Sequoia Capital also investing. Forbes has more here.

Blocks.diy, a Tel Aviv startup founded less than a year ago that enables teams to build custom AI-powered work tools and smart agents, raised a $10 million seed round led by Monday.com, with additional participation from Qumra Capital and Entree Capital. More here.

Kamino, a four-year-old São Paulo startup whose financial software helps Brazil’s mid-market companies automate and manage cash flows, raised a $10 million Series A round co-led by previous investors Flourish Ventures and Quona Capital. More here.

Klaar, a three-year-old San Francisco startup that helps companies manage employee performance and reduce bias in evaluations, raised a $5 million Series A round. Prime Venture Partners was the deal lead, with previous investor Shastra VC also contributing. Entrepreneur has more here.

LocusX, a Montréal startup founded this year that uses AI to help game developers identify and fix bugs more quickly, raised a $2.2 million seed round co-led by Diagram Ventures and Triptyq Capital. BetaKit has more here.

OpenHealth Technologies, a three-year-old Berlin startup that helps clinics, labs, and health companies turn fragmented lab results into structured, AI-ready data for personalized care, raised a $3 million seed round co-led by GoHub Ventures, xdeck ventures, Edenbase, and Exceptional Ventures, with previous investors YZR Capital, Octopus Ventures, and Calm/Storm Ventures also chipping in. The company has raised a total of $4.3 million. Tech Funding News has more here.

Rendezvous Robotics, a Denver startup founded this year that develops reconfigurable space structures using modular tiles that autonomously dock and rearrange in orbit, raised a $3 million pre-seed round co-led by Aurelia Foundry and 8090 Industries, with support from ATX Venture Partners and Mana Ventures. TechCrunch has more here.

Tot, a five-year-old Milan startup that provides online tools to help small businesses manage finances and administration, raised a $7.6 million pre-Series A round led by CDP Venture Capital, with Azimut Group, The Techshop, X-Equity Venture Club, and ClubDeal Digital as well as previous investor Banca Sella participating. Tech.eu has more here.

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New Funds

Una Terra, a four-year-old VC firm based in Zurich, has raised a $54.5 million fund to invest in growth-stage companies working on packaging, waste, food, fashion, and other circular economy models to cut plastic and carbon waste. ESG Today has more here.

Exits

F5, a 29-year-old Seattle company that sells security and app delivery tools, is paying $180 million to acquire CalypsoAI, a seven-year-old startup with offices in Ireland and New York that helps enterprises secure their generative AI systems. CalypsoAI’s investors include Paladin Capital Group, Lockheed Martin Ventures, Hakluyt Capital, and Expeditions Fund. GeekWire has more here. 

Nayya, a six-year-old New York startup that uses AI to help employees navigate health and wealth benefits, has acquired Northstar, a nine-year-old San Francisco company that provides financial wellness support as an employee perk. Terms were not disclosed. More here.

Going Public

Figure, a seven-year-old startup based in San Francisco that uses blockchain to issue loans like home equity lines of credit, raised $787.5 million in its IPO at a $5.3 billion valuation, with shares set to debut 36% above the offering price. Bloomberg has more here.

Gemini, the Winklevoss twins’ crypto exchange, is more than 20x oversubscribed ahead of its Nasdaq debut, leading the duo to make the unusual decision of capping Gemini's IPO at $425 million. Reuters has the scoop here.

People

Sam Altman’s legal team is asking a judge to force two members of Elon Musk’s inner circle — Shivon Zilis, Neuralink’s operations chief and mother to several of Musk’s kids, and Jared Birchall, who runs Musk’s family office and foundation — to hand over texts and emails or face extra depositions, escalating the legal brawl over Musk’s $40 million OpenAI suit ahead of a March trial. Business Insider has more here.

The Financial Times digs into how Larry Ellison rode the “AI tsunami” to briefly become the world’s richest man. More here.

Data

OpenAI is projecting $200 billion in revenues by 2030, but computing costs are much higher than its rivals’. The Information has more here.

Essential Reads

Startups like Varda, Anduril, and LeoLabs are scrambling to prove their tech can track and intercept hypersonic threats as they jockey for a spot in Trump’s $175 billion “Golden Dome” missile defense project, a modern Star Wars-style gamble that could mint the next generation of defense giants. The New York Times has more here.

Perplexity just got slapped with another copyright suit, this time from Encyclopedia Britannica and Merriam-Webster, which accuse the startup of scraping their sites, repackaging the content in its “answer engine,” and siphoning traffic. Reuters has more here.

Detours

The Center for the Alignment of AI Alignment Centers.

Kristen Wiig’s Pretty Glitter Kitty Litter.

Brain Rot

restorationkamasutra

1M followers

View more on Instagram

Retail Therapy

Wealthy Americans are flocking to New Zealand’s Te Arai Links as relaxed golden visa rules let them snap up multimillion-dollar homes on its world-ranked golf courses, cementing the country’s role as the ultimate Plan B for the jet-set.

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