A self-driving company is going public!

Top News

• Pony.AI wants to go public in the United States: While domestic IPOs have been slow-moving in recent quarters, there are signs of life, like Chinese robotaxi company Pony.AI choosing the Nasdaq as its target. As you might expect, Pony is unprofitable, but will offer public-market investors a chance to invest in a self-driving company still early in its commercialization. Pony is working on both self-driving cars (taxis) and trucks (freight), making it a double-play of sorts. That said, US investors’ appetite for China-based companies will need to be retested.

• Perplexity expands to local data search: Perplexity’s AI search tool is handling hundreds of millions of queries each month, and the well-funded startup wants to keep that number growing. The company announced a new capability to search both the web and internal corporate documents simultaneously. The new feature will allow companies to better tap their internal data and knowledge, potentially extending Perplexity’s TAM.

• Netflix crushes Q3 earnings: American streaming giant Netflix beat both top and bottom-line expectations in its third-quarter earnings report. The results were welcome, with Netflix’s stock up around 11% today. But nested in recent Netflix financial reports was an important detail: Netflix is printing cash these days. A few years back, there were concerns that it was outspending its cash flow-generating abilities; those worries may have been completely shut down now, thanks to the company’s performance.

A New Addition to the TWiST500

Today, we’re adding a single company to the TWiST500: Monte Carlo. That it took this long to get it onto the list is my own fault, but there really are a lot of companies out there today. Keeping them all straight is a full-time job.

Monte Carlo, an early light in the data observability (DataObs) space, raised rapid-fire rounds, from Series B through D in record time during the 2021-2022 timeframe. The company last raised $135 million at a $1.6 billion valuation in mid-2022, for reference. How did it raise that much capital so quickly? Quoting from my own work at TechCrunch:

Recall that when Monte Carlo raised a $60 million Series C in August 2021, we reported that it had “doubled its ARR in each of the last four quarters.” Since that round, the company said in a release that it has “more than doubled revenue every single quarter, with an 800 percent increase in revenue year-over-year.”

To be clear, those data points are now pointedly dated, but they do underscore why Monte Carlo caught both the eye of VCs and journalists.

Why add Monte Carlo to the TWiST500 if our data regarding its performance is out of date? Simple: Data. In the AI era, we find that unique data is gold. That is, an AI model with unique, high-quality data is better than one without, all else held equal. The same goes for corporate AI use, where companies bring their own data for AI ingestion and elucidation.

Well, what if your data is wrong? The AI outputs from it will be off, too. This means that data accuracy is now more important than ever. And guess what software category fits that bill? DataObs. Onto the list with Monte Carlo! — Alex

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This Week in Startups

E2028: Sarika Garg joins Alex to share her startup journey founding Cacheflow, addressing challenges in B2B sales and the complexities of SaaS billing. She discusses HubSpot’s acquisition of Cacheflow, integration into HubSpot's Commerce Hub, and its positioning as an AI company, along with key lessons on early exits, product-market fit, and organizational efficiency. Sarika also reflects on shifts in SaaS buying behavior, remote work, and future growth plans with HubSpot.

Startup Finance Basics: Kruze COO Scott Orn joins Jason to share top financial advice for startups, including managing cash flow and avoiding the pitfalls of over-fundraising. They explore growth strategies, legal considerations around financial representation, and how to maintain credibility with VCs. Key insights also cover building a strong financial plan and the evolving landscape of funding with a focus on regulatory issues.

E2027: Jason and Alex discuss the FTC's new subscription rules and their potential impact on businesses. They dive into Density's announcement of their "Waffle" product and how real-time data tracking is shaping city planning and operational efficiency. Other topics include the economics of sensor technology, the rise of robotaxi fleets, and nuclear energy deals involving Google, Kairos, and Amazon.

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