China giveth, but China also taketh away

Top News

• China clamps down on DeepSeek: The Information reports that, in the wake of its breakout global success as an AI model company, staffers at DeepSeek are seeing their freedoms curtailed. Some of its staff are no longer allowed to leave the country, and have had their passports taken. That won’t help innovation, but DeepSeek is also enjoying a wave of patriotism-fueled uptake of its AI products. In other words, China taketh away, but China also giveth.

• Docusign rips higher: What will AI do to traditional SaaS companies? It’s likely that some will wither and die on the vine. But Docusign is showing signs of real life. Investors cheered its earnings report and AI momentum — indication that not every software incumbent will fall prey to new, nimbler AI-first competitors. Docusign still needs to reaccelerate growth, but it appears that more investors than before think that it will be able to do so.

• Flock Safety, Terabase raise huge rounds: YC-backed visual-safety startup Flock Safety has raised a massive $275 million round at a towering $7.5 billion valuation. Best known for its license plate reading technology, Flock’s security products won’t delight you if you are privacy-conscious; but for retailers fighting shrinkage and schools hoping to keep kids safe, Flock could be more boon than burr. But wait, there’s more! Terabase raised a $130 million Series C led by Vision Fund 2. Terabase helps customers install huge-scale solar arrays. As SoftBank is also investing in OpenAI, which needs lots of well-lit data centers, you can spot the synergies.

TWiST500

First, the TWiST500 is now 275 companies strong after Lon and I got the next batch of companies uploaded. Expect us to reach 300 next week. You can find the full list here!

To close out the week, let’s look at TollBit and Human Native, our two TWiST500 companies that are working on content licensing tech in the AI era. As discussed on the show today, OpenAI wants to be able to train its for-profit AI models on copyright-protected information without complication. So much so that it’s lobbying for the federal government to back its view.

On one hand, OpenAI remains a private company and is therefore a startup of sorts. And we’re in favor of startups having room to experiment. However, it’s also true that if OpenAI gets its way, startups like TollBit and Human Native will see their markets crushed. Not obviated, but certainly reduced.

Notably, one way to read the OpenAI paper is that it advocates for the US government to push other governments to ensure that AI model companies can access copyright-protected material sans the need for permission or payment. Human Native, which is not an American company, might not have much wiggle room if OpenAI gets its own way. There’s no pure ‘pro-startup’ take here, in other words.

Jason and I share a view that words and ideas have value, which underpins why we added TollBit and Human Native to begin with. Here’s to both going public someday. — Alex

A message from Lemon.io

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This Week in Startups

E2096: This was an episode SO PACKED with fresh news, we needed 3 co-hosts. Jason, Alex, and Lon take on the return of Gawker’s Nick Denton, who now has “skin in the game” and lots of thoughts about EVs. Then there’s serious disagreement about Project Europe: an exciting moment for continental innovation, or just another Y Combinator riff? PLUS Anthropic’s huge revenue jump, Pokémon Go heads to Saudi Arabia, why are X and xAI still different companies, and much much more.

E2095: On a blockbuster TWiST that’s currently blowing up on social media, Jason and Alex welcome young coding whiz and (by now, likely former) Columbia University sophomore Roy Lee, who went viral after hacking his way around technical interviews at Meta, Capital One, and Amazon. Even after an Amazon exec dropped a dime on Roy, getting him in trouble with his alma mater, he still took the time to stop by the show and give us insight into his new company, InterviewCoder.

E2094: On a special futurist edition of TWiST, Alex welcomes not one but TWO insightful guests. FIRST UP, Zap Energy CEO Benj Conway tells him about the promising future of fusion power technology. THEN, Alex is joined by PolyAI CEO Nikola Mrkšić for a deep dive on how AI will soon revolutionize customer service via ultra-realistic human-like voice assistants.

TWiST Partner Offers

• Squarespace: Turn your idea into a new website! Go to https://www.Squarespace.com/TWIST for a free trial. When you’re ready to launch, use offer code TWIST to save 10% off your first purchase of a website or domain.

• Northwest Registered Agent: Starting your business should be simple. With Northwest Registered Agent, you can form your entire business identity in just 10 clicks and 10 minutes. From LLCs to trademarks, domains to custom websites, they’ve got you covered. Get more privacy, more options, and more done—visit https://www.northwestregisteredagent.com/twist today!

• AdQuick: Easily plan, deploy and measure out-of-home campaigns as easily as digital ads. Visit www.AdQuick.com/twist to learn more - and just for TWiST listeners- they’re waiving their fee on your first campaign.

Angel University

Angel University is back! Jason and Mike, President at LAUNCH, are hosting our next live Angel.University workshop in person on Wednesday, April 23rd, in NYC. Jason will be teaching the strategies he’s used to invest $100M+ in 300+ startups over the past decade. Register at: angel.university.

Founder University

Applications are open for Founder University Cohort 10, 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 Spring 2025!

LAUNCH Accelerator

Applications are open for the 34th cohort of the LAUNCH Accelerator; a 14-week program focused on fundraising and growth. We invest $125K in our accepted companies and help them raise their pre-seed or seed round. Submit your application at LAUNCH Accelerator.

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