Google faces possible breakup, AI table stakes, and a new unicorn

Top News

• Google could be broken up: After being branded a monopolist in federal court, Bloomberg reports that Google could be heading for a breakup. It’s not entirely clear what parts of Google might be excised and forced to go it alone, but the idea alone is an earthquake in technology circles. Not since Microsoft’s legal troubles in the 90s have we been faced with a true technology incumbent potentially being forced to disaggregate itself.

• Is GPT4 table stakes now? Early data indicates that the latest version of the Grok AI model joins four other models with performance similar to GPT-4. That means that folks looking for a leading-edge AI model have many to choose from; competition is doing its thing in the AI race, and we’re all richer for it. But it does beg the question of what comes next. When do we get the next step-function boost in AI capability? And, critically, who releases it first?

• Kiteworks is now a unicorn: Previously known as Accellion, Kiteworks has raised $456 million from Insight Partners and Sixth Street Growth. The new capital pushes the company’s valuation above the $1 billion mark, TechCrunch reports. How did Kiteworks manage to earn a horn in 2024? It’s profitable, which certainly doesn’t hurt if you want to raise a huge check today.

New TWIST500 members!

It’s time to add more names to the TWiST500!

First, Kiteworks. The funding round that we mentioned above gives Kiteworks both the financial ammunition to pursue M&A if it chooses and enough capital to get it to an IPO. At least by our reckoning; the IPO market might be pretty limited today. But it’s still a leading private-market business that could be set to generate quick returns, so it has been added to the list.

I’m also adding a few other names to the TWiST500 today:

• Canva: Canva is an obvious TWiST500 member, given that it is already one of the most impressive examples of private-market value creation in the last decade. Its recent purchase of Leonardo.AI (I have some notes here) makes it all the more a company to keep top of mind.

• Suno and Udio: Suno and Udio may have short tenures on the TWiST500. The music AI companies are facing suits from music rights holders that could scupper their entire model, and thus their corporate lives. Or, they may prevail and usher in a sea-change in how music is produced and consumed. Binary bets are no sin in venture, and these two startups could be huge. Thus, I am adding them.

• Substack and Medium: Medium is a TWiST500 member on the merits of reaching one million paid subscribers. Sure, Medium’s long history of pivots is well-known, but the online writing platform seems to have found its path forward and is busy getting huge.

• Then there’s Substack. Culturally, Substack is a big deal. Financially, things are less certain. Its equity crowdfunding campaign kept its valuation flat, and it doesn’t seem that more venture capital is in the offing. But all the same, Substack has tapped into a creator niche that has proven to have long-lasting consumer legs. If its growth slows, we’ll pull it, but for now, it makes more sense for Substack to have a place on the list than not. — Alex

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This Week in Startups

E1992: Jason and Alex were back for another news roundtable, digging into the recent Trump-X conversation, WeRide’s upcoming self-driving IPO (Alex notes here), Polymarket and Perplexity teaming up, and European venture capital.

E1991: Jason sat down with founders from four different Founder University companies, listening and responding to their pitches live. Pablo Fernandez of Big Rentals, Brittany Peregoff of Where2Wheel, Ardalan Mirshani of MyLens, and Mariano Apodaca of Prosperous AI shared what they were building and detailed their current traction. If you love startups, this is a must-watch episode.

E1990: This episode throws it back to our LIQUIDITY Summit! Featuring Antonio Gracias of Valor and Gavin Baker of Atreides Management.

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