Tech earnings start rolling in as Vanta raises $150M

Top News

• Meta’s new AI model impresses: A new model in the Llama family from Meta is causing waves in the AI world. The new model is a unique combination of being impressively performant, considering it being open-source. In short, the world’s leading social networking company is pushing the boundaries of open-source AI towards being state-of-the-art. For open-source fans, it’s a big win. For backers of closed-source AI model companies, the news is likely less exciting.

• Tech earnings start rolling: Yesterday, tech titans Alphabet and Tesla reported Q2 2024 earnings. Alphabet’s download included accelerating revenue growth, improved operating margins, and more. Despite those wins, shares of Google’s parent company are off 3.5% today. Why? Alex reckons it’s more than just a miss on YouTube revenue growth. IBM reports today, and a host of other leading tech names next week.

• Vanta raises $150M: Software does well when charging for reducing complexity. Vanta’s software rips the manual work out of compliance, saving customers time and resources. The effort is paying off for the startup, which just raised $150 million at a valuation of $2.45 billion, sharply above its prior $1.6 billion valuation. A 50% valuation bump for a SaaS unicorn in today’s market is no small feat.

TWiST500

OneStream was never a TWiST500 company because it sold a majority stake to private equity a few years ago. But now it’s back and, as of today, a publicly traded company. Even more interestingly, the software company priced its IPO above its proposed range. Charging $20 per share instead of $17 to $19 may seem like a modest bump, but OneStream’s above-range pricing indicates that public market demand for new tech shares is not moribund.

Will that help the dozens of unicorns on the TWiST500 list kick off their public offering cycles? Probably not. After all, the domestic political landscape is far from settled today, and even during more normal times, IPOs during election years were scarce. But OneStream’s pricing does indicate that when the climate for debuts improves, we may not be staring down the barrel of IPO pricing that makes founders and venture capitalists alike want to sit in the corner.

We’ll have new TWiST500 companies soon, so stick close to this newsletter.

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This Week in Startups

E1984: Jason and Alex’s latest news roundtable dug into the Google-Wiz deal’s demise, new AI models from Meta, and even the latest UBI study. Wiz’s choice to pursue an IPO over a sale could yield greater returns down the road, but at what price is not clear. Meta’s new Llama 3.1 405b model, meanwhile, has put open-source AI at the front of the pack when it comes to performance, shaking up the artificial intelligence landscape for months to come.

E1983: Benchmark investor Sarah Tavel is back! Tavel and Jason discussed the critical role of governance and accountability in startups, and the relationship between hype, investment decisions, and startup promotion. And for the software fans, the venture capitalists discussed the challenges that SaaS faces in the market today. Tune in!

E1982: Jason was joined on TWiST by True Anomaly’s Even Rogers this week. True Anomaly builds satellites and software to run them, focused on getting close to other satellites. Why does that matter? Defense applications, for one. The pair dug into defense contracts, national security, and even China-Taiwan tensions. If you are into space, startups, and security, this one is for you.

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