And we all float cryptocurrencies okay

Top News

• Everyone wants to float cryptocurrencies: The Tron blockchain and cryptocurrency has announced a reverse merger of sorts with a small public company. The goal, per a release, is to create a public “TRON Token Treasury Strategy.” Savvy readers will recall that several companies are working on bitcoin treasury strategies to bolster their public-market value. Elsewhere in cryptoland, the company behind Truth Social wants to get in on the crypto ETF game by launching a hybrid bitcoin and ethereum vehicle that will invest 75% and 25% of assets into the two tokens, respectively.

• Stripe the Unicorn Maker: Stripe has become so large and wealthy while private that it is able to act as a multi-stage venture capital firm. Evidence of this came recently from PostHog’s $70 million Series D, which Stripe led. PostHog, which sells open-source tools for teams building digital products, is a weird company in the best possible sense. It’s cutting against limited free tiers, closed-source code, price increases and lock-in. And the model appears to be working, given its open-source cred and new funding round.

• Patreon rejiggers its business model: Starting this August, Patreon will take a flat 10% cut of creator earnings, up from a prior minimum of 8% (though the company did have a higher-priced 12% tier as well). To avoid a community blowup, the venture-backed company will allow existing customers to keep their current splits, and is encouraging folks who want the lower 8% rate to get started now. But come August, prices are going up. Why? Patreon argues that it has done a lot of work to build a product worth the additional 200 basis points of vig. Proof will come with new creator signups in August, but as Patreon’s last known valuation was $4 billion back in 2021, it has a lot of shareholder equity to defend.

TWiST500

The most important TWiST500 news today is that OpenAI and Microsoft are getting along about as well as two cats in one bag. The Journal reports that conversations between the two technology powerhouses are stalled over terms. OpenAI doesn’t want to share Windsurf’s IP with Microsoft — recall that Windsurf is still a TWiST500 company until it exits — as the latter has a competing product in the market. Microsoft, on the other hand, has to be convinced to allow OpenAI to convert itself into an entity that has a shot at going public.

The Journal also reports that equity splits stemming from the proposed evolution of OpenAI from not-for-profit status into a public benefit company are not yet sorted out. Things are bad enough that OpenAI is considering — so go the leaks — “accusing Microsoft of anticompetitive behavior during their partnership,” which could get the government involved and potentially rip up prior contracts.

What a mess.

Speaking of messes, now that Meta is buying most of Scale AI’s shares, companies that compete with Meta in the AI game are moving away from the smaller company like fish poked with sticks. OpenAI, xAI, Google and others are reportedly working to find other providers for data labeling, LLM evaluation, and the other work that Scale AI executes today.

The situation could result in a massive windfall for startups like Turing, Labelbox, Handshake, Labelerr, iMerit, Dataloop, SuperAnnotate and others. Clearly we need to put the best of the bunch onto the TWiST500. Expect the next list of additions later this week. — Alex

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This Week in Startups

E2138: On a brand new TWiST, Jason and Alex break down Stripe’s bet on crypto wallets, the big return of M&A activity, and the rapid rise or warehouse robots taking over jobs from human workers. Plus Tesla’s FSD tests, Disney’s copyright battle against AI platforms, and lots more good stuff.

E2137: We’re testing out a brand-new panel discussion format: The TWiST VC Roundtable! On our first installment, Jason and Alex chat with Paige Doherty of Behind Genius and Meghan Reynolds of Altimeter about the rise of secondary markets, the resurgence in M&A activity from major tech players, questions about potentially inflated ARR figures from YC startups, and lots more!

E2136: Jason’s calling in from the coast for a special Monday episode, chatting with Alex about the sky-high valuations for many new Y Combinator companies, despite their relatively low ARRs. What does this mean for the investment landscape more generally? Plus the guys are taking Office Hours with CustomerIQ founder Sean Steigerwald, exploring his startup’s AI sales agents that live inside your email inbox.

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LAUNCH Accelerator

We’re hosting an in-person Demo Day for LA34 in SF on July 16 from 9a-12p PT, the latest cohort from Jason Calacanis’ Accelerator.

If you are an early-stage investor and interested in attending, please reach out to [email protected].

Want to Work for This Week in Startups?

We’re looking to fill two in-person sales positions at our Austin, Texas HQ! First, a high-performing Sales Executive to help us seek out and promote clients, sponsorships, branded content, and more. Plus an experienced Sales Manager to lead, coach, and scale our sales executive team, while setting performance goals. Love the podcast and have B2B sales experience? We want to hear from you!

SF Live-Work Space Now Available

Need a flexible living and working environment in San Francisco? This thoughtfully designed loft-style residence at 787 Bryant St., the heart of the vibrant SOMA district and the city’s creative hub, is now available for rent or purchase. Check the listing for more details.

Founder University

Applications are open for Founder University Cohort 11, a 12-week remote pre-accelerator program tailored towards navigating early-startup practices, building an MVP, and growing traction. Submit your application at Founder University— Cohort 10 will kick off Summer 2025!

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