Author name: Shannon Garcia

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Angel and seed funding remain insulated from startup market volatility: Report

Ecosystems, Investors and funding, Startups and technology / /

Angel and seed funding in Europe are remarkably resilient to the startup market downturn, according to new research by Pitchbook.

In the first half of 2021, both median deal values and valuations in these stages exhibited positive trends. The biggest increase was in median angel deal values, which were up 28.8% compared with 2022. The median angel valuation, meanwhile, was up 10.2%, while the median seed-stage valuation was flat.

These figures illustrate the insulated nature of early-stage funding. Angel and seed rounds are typically more removed from public markets, as businesses at those stages are further away from maturity and exit. Because the returns tend to be long-term, investors in these rounds are less dependent on temporary market frailties. 

Public funding programs have also helped. The growth of angel and seed stages in the UK, Ireland, France, and Benelux was partly credited to government initiatives, such as SEIS and the FCPI.

Pitchbook expects angel and seed valuations to remain relatively insulated from near-term market volatility. In later rounds, however, the signs are less encouraging.

At the venture-growth stage, times are particularly tough. In the first half of 2023, median venture-growth valuations and deal value paced at 18.5% and 16.7% below their full-year medians from 2022, respectively. 

One factor behind this decline is the role of nontraditional investors, such as investment banks, private equity firms, and pension funds.

In previous years, these investors boosted competition, round sizes, and valuations at the venture-growth businesses, which often have similar operations to large public companies. But in H1 2023, deal value with nontraditional investor participation dropped from €27.8bn to €18.7bn.

That may reflect attentions shifting to early-stage funding. The proportion of deals with nontraditional participation has stayed at around 38% since 2021 — which suggests they’re focusing on smaller, earlier rounds where deal value is lower.

Despite the early-stage resilience, the broader funding landscape remains immensely challenging.

Down rounds, for instance, have become far more common. In Q2, 26.2% of company valuations were lower than in the previous funding round. A notable example is Turkey’s Getir, which was hit by a 42.4% decrease in valuation in Q2 2023. 

Unicorn activity, meanwhile, has been constrained. There are currently 134 privately-held startups in Europe valued at least €1bn, but only five have emerged since the end of 2022 — a rate markedly lower than in the previous two years. To mitigate this decline, Pitchbook recommends more support from government funds for venture-growth companies.

Exit valuations have also plunged. The median valuation fell from €33.9mn in the first quarter of the year to €17.3mn in Q2.  Macroeconomic factors — namely interest rates — are driving the dip.

Pitchbook expects further corrections to be lumpier with a lag to public equities, which means it’s too early to assume that the declines have reached the bottom. As a result, stakeholders will need patience and extended runways to manage the industry’s loss of liquidity and capital.

Angel and seed funding remain insulated from startup market volatility: Report Read More »

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Following Single-player Successes, Polyarc Announces First PvP Game ‘Glassbreakers – Champions of Moss’

glassbreakers, glassbreakers champions of moss, moss pvp, News, polyarc, quill pvp, VR Game / /

Following a tease earlier this year, Polyarc Games has announced its first PvP game, Glassbreakers – Champions of Moss, based on its acclaimed single player adventure games Moss (2019) and Moss: Book II (2022).

Moss and Moss: Book II exemplify third-person VR adventure games, giving the player control of a mouse named Quill which travels through the fantastical world of Moss. Uniquely to third-person VR, the player isn’t just the person behind a screen, but actually exists within the game and can interact with Quill and the environment to solve puzzles and aid in combat.

Alongside great design, art, and polish, the successful execution of this concept is what has kept Moss among the 20 best rated Quest games for years now. We went behind-the-scenes of Moss: Book II last year to learn more about what made the game shine.

Now developer Polyarc Games plans to translate the concept into a standalone PvP title, Glassbreakers – Champions of Moss, the studio’s first departure from single-player VR games.

Details on Glassbreakers is light as the studio is saving a broader reveal for an August 29th showcase at 9AM PT (your timezone here), but ostensibly the game will continue to focus on controlling small third-person characters, with some level of direct player interaction. A teaser image shows a few characters we already know from the games alongside some seemingly new faces that are likely to be part of the game’s roster for players to control.

We’ll be interested to see if the studio can amp up the game’s relatively simple combat to create a truly competitive game, and what direct interactions players will be able to have between themselves and their character, or maybe even themselves and the opposing player.

While a launch date for Glassbreakers hasn’t been announced, a holiday 2023 release date looks likely. While the game has been confirmed for Quest so far, there’s a good chance Glassbreakers will also make it to PSVR 2 and PC VR just like its predecessors.

Following Single-player Successes, Polyarc Announces First PvP Game ‘Glassbreakers – Champions of Moss’ Read More »

german-chancellor-says-push-for-renewables-will-revive-economy

German chancellor says push for renewables will revive economy

Europe, Government and policy, Sustainability / /

Germany’s Chancellor Olaf Scholz says he believes forthcoming green tech investments will benefit the country’s stagnated economy as a whole.

In a ‘summer interview’ with public broadcaster ZDF, the chancellor stated that the government has “moved at an incredible pace” when it comes to shifting legislation around hydrogen production and other renewable energy sources. 

Indeed, in June this year, Germany overtook China as the second most attractive country for investing in renewables (the US ranks first). The country has set a target for renewable sources to make up as much as 80% of its energy mix by 2030 (currently at 46%). This is nearly double the provisional target of the EU as a whole (42.5%, aiming for 45%, set in March 2023). 

High energy costs along with a shortage of skilled labour have been major culprits in slowing down the German economy over the past year. In a push for independence from Russian oil and gas, the government also temporarily backtracked on its promise to phase out coal as an energy source. However, the intention still stands to shut down all coal production by 2038 (earlier for certain states), and to reach climate neutrality by 2045. 

To that effect, Germany has set up the Climate and Transformation Fund, worth €177.5bn. However, €47.6bn is set aside to help those struggling due to higher energy prices, and a further €20bn has been reallocated toward attracting international semiconductor manufacturers.  

The government has thus far used that cash to lure companies such as Intel, TSMC, and Infineon to build chip plants in Germany, and in particular in what is being dubbed “Silicon Saxony.” Meanwhile, Scholz stated in the interview that these companies have not chosen Germany due to the generous state subsidies, but rather “as an economic location.” 

Germany’s green hydrogen strategy

A big chunk of the fund (approx. €56.3bn) will go to the climate-friendly renovation of buildings, a sector currently holding Germany back when it comes to efforts in energy efficiency. The government has also allocated €19.9bn toward the decarbonisation of industry and the implementation of the Green Hydrogen Strategy. 

The aim of the strategy is to have 30GW of electrolyser capacity in Germany by the end of the decade and to make the country ​​a leading supplier of hydrogen technologies. It also foresees the construction of an initial “core” hydrogen network to enter operation by 2032. 

Scholz’s coalition government adopted the updated strategy to accelerate the domestic hydrogen market in July this year. Energy industry association BDEW welcomed the update. However, it said it lacked a clear alignment between funding mechanisms, general framework conditions, and market design.

“Energy companies are willing to invest in a hydrogen economy, but they need a clear framework, both at national and European level,” BDEW head Kerstin Andrae told Clean Energy Wire last month.

Meanwhile, climate NGOs are sceptical as the strategy says that state subsidies could potentially go to blue hydrogen (produced from fossil fuels but using carbon capture) projects. 

Despite the updated strategy, Germany will need to import 70% of its hydrogen demand if it is to succeed in reaching climate neutrality by 2045. With green hydrogen currently accounting for about 1% of global supply, the question is who is going to produce it.

German chancellor says push for renewables will revive economy Read More »

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Einstein, Newton could have been wrong about gravity, Gaia telescope data reveals

Deep tech, Startups and technology / /

A groundbreaking study, based on observations from the European Space Agency’s billion-pixel Gaia space telescope, has revealed a “gravitational anomaly” that challenges our fundamental understanding of the universe. The anomaly occurs when loosely orbiting stars, known as wide binaries, seem to move in ways that defy standard models of gravity established by Albert Einstein and Isaac Newton.  

Astronomer Kyu-Hyun Chae from Sejong University in South Korea made the discovery while studying binary star systems, which refer to two stars that orbit each other. At accelerations of lower than 0.1 nanometres per second squared, the orbit of the two stars deviated from Newton’s universal law of gravitation and Einstein’s general relativity. 

The discovery puts into question the existence of ‘dark matter’ which was often used to explain such anomalies. “Testing gravity with wide binaries is interesting because dark matter can play no role in their internal dynamics,” Chae said.

Professor Chae theorised that a model known as Modified Newtonian Dynamics (MOND) could explain why these previous theoretical frameworks were unable to explain the stars’ movements. MOND was first conceptualised by Israeli physicist Mordehai Milgrom, who proposed a modification to the laws of gravity at low accelerations to explain observed irregularities in galactic rotation without the need for dark matter.

“Chae’s finding is a result of a very involved analysis of cutting-edge data, which, as far as I can judge, he has performed very meticulously and carefully,” said Milgrom, from the Weizmann Institute in Israel. “But for such a far-reaching finding – and it is indeed very far-reaching – we require confirmation by independent analyses, preferably with better future data.

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“If this anomaly is confirmed as a breakdown of Newtonian dynamics, and especially if it indeed agrees with the most straightforward predictions of MOND, it will have enormous implications for astrophysics, cosmology, and for fundamental physics at large,” he added.

Professor Chae commented on the implications, asserting that potential systemic errors were rigorously examined and the results appeared to be genuine. He anticipates that the results will undergo further scrutiny and refinement as more data becomes available.

Nevertheless, these findings could have a profound effect on our conception of the universe. “Because the standard cosmology is based on general relativity, cosmology needs a major revision now,” Chae said. “I think we are now entering an extremely exciting period of time.”

Einstein, Newton could have been wrong about gravity, Gaia telescope data reveals Read More »

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Composition co-written by AI performed by choir and published as sheet music

Artificial Intelligence, Corporates and innovation, Creativity, Deep tech, Next Featured / /

Ed Newton-Rex, a creative AI pioneer and VP Audio at Stability AI, says that he’s become the first author to publish a piece of classical music that uses generative AI. The musician and entrepreneur wrote his “I stand in the library,” a piece for the choir and piano, to a poem produced by OpenAI‘s generative AI model GPT3.

Written back in 2022, the 15-minute composition has been premiered at the Live from London online classical music festival, performed by a choral group VOCES8. The full version of the performance is available (behind paywall) on the festival’s website, but here’s an exclusive preview to give you a general idea:

‘Among Us VR’ Gets New Polus Point Map, Trailer Here Read More »