Meta beats the street as open-source AI gets a boost

Top News

• Meta crushes earnings: Shares of Meta are up over 7% this morning in the wake of a solid Q2 earnings report from the company — more here, if you want the numbers in video form. As expected, Meta grew its revenues, profits, and user base. So much so that it beat street expectations for the period and forecasted growth that investors were content with. Tech companies are having a mixed earnings season thus far, but Meta remains so solid a business that it can lose $4.5 billion on its AR/VR bets in a single quarter and shrug it off.

• A shot in the arm for open AI: This week, the National Telecommunications and Information Administration came out in favor of open AI models and weights, saying that the benefits thereof outweigh potential concerns. Of course, the NTIA is not the entire government, but its words carry with them the institutional weight of the Department of Commerce, which is not nothing. Also, today, the EU’s AI regulations started to take effect.

• Reddit is not happy with data scraping: Reddit has deals with Google and OpenAI, limiting who can ingest and use its data. Keeping other companies from helping themselves has proved to be a “a real pain,” the company’s CEO Steve Huffman said. While many scribblers and doodlers and talkers and singers have complained about AI-related data scraping and use, hearing the same from technology companies may carry more weight. Thanks to Reddit, the complaints are now coming from inside the tech industry.

TWiST500

Today, we’re adding two new companies to the list that recently raised mega-rounds. These companies will help round out the company focus list we’re developing on the TWiST500. Please meet Spring Health and Flo.

Spring Health has raised nearly a half-billion in raised capital, including a recent $100 million Series E that pushed its valuation to $3.3 billion. What does it do? Targeted mental health care. What does that mean in practice? The company collects lots of data on the user and then “pinpoints the right option” for them, in its own words. Anyone who has tried to find a therapist knows how hard it can be to select, let alone secure, proper mental health care.

Spring’s model is working, with the company reporting 270% revenue growth in 2022. That the startup raised in both 2023 and 2024 indicates that its growth rate has not fallen off a cliff, and its new, higher valuation implies a very stable revenue base. Sure, Spring Health is clearly an IPO candidate on the TWiST500, but that’s no sin. It’s also a very interesting health tech startup with an AI twist, making it an easy addition to our list of the most interesting — and potentially lucrative — private market companies.

Then there’s Flo. Thanks to a $200 million round in late July, Flo is now a unicorn. That valuation mark is predicated on 70 million monthly active free users, and what TechCrunch describes as 5 million paid members. Flo is a fertility-focused digital service that offers a period-tracking app. Its paid service costs single to double digits each month.

What I like about both these companies is that they are health-focused. Sure, they are focused on different things, but they share a focus on helping people live more healthy, fulfilling lives. And that’s something to cheer on when the underlying assets in question also quickly scale in value.

It’s good to get more health tech onto the list. — Alex

A message from OpenPhone:

OpenPhone brings your team’s business calls, texts, and contacts into one delightful app that works anywhere. Get 20% off your first 6 months at openphone.com/twist.

This Week in Startups

E1987: On the latest episode of Liquidity Pod, Dana Johns (Head of Private Equity at New Jersey Division of Investment) and Tom Loverro (General Partner at IVP) joined David Weisburd (10X Capital) and Jason Calacanis (LAUNCH) to chat through the secondary markets, venture leverage in dealmaking today, and the IPO window.

E1986: Jason sat down with WEKA CEO Liran Zvibel and Valor’s Antonio Gracias to dig into what the data platform startup is up to and why Gracias joined its board after its latest funding round. The conversation is a must-listen if you want to learn more about modern data management techniques. To close, the latest JCal winner Ramsey Schaffer, CEO of Uptrends AI came on to share what his startup is building.

E1985: Etsy CEO Josh Silverman swung by the podcast to talk about how his company is reacting to the AI era. Etsy is best known for its hand-crafted goods that small creators sell. Jason and Silverman dug into how to build and maintain a unique marketplace, operate a company in a remote-friendly world, and how organic traffic flows are changing today.

TWiST Partner Offers

• Squarespace: Turn your idea into a beautiful website! Go to http://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.

• Google: Accelerate your startup journey with the Google for Startups Cloud Program. Get up to $200K in Google Cloud credits – or up to $350K for AI startups – plus training and guidance. Apply at startup.google.com/twist. ‬

• Brex: Runway is everything for startups. That’s why 1 in 3 startups choose Brex for modern checking, treasury, and FDIC protection in one account. Move money fast worldwide. Earn yield from your first dollar  — while accessing your funds anytime. And get up to $6M in FDIC coverage from program banks. Learn more at https://www.brex.com/.

The TWiST500 newsletter is the new, updated, and improved TWiST Ticker.