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The AI Value Chain Has Shifted. Here’s How Founders Can Still Build A Sustainable Business
Daniel, founder of a new AI startup, recently scaled his AI-powered SaaS app to $250,000 in annual revenue. It happened fast, and he was thrilled. The product was taking off, users were growing, and everything looked like it was working. Then came the shocker: a cloud invoice for $800,000, driven almost entirely by inference and compute tied to API usage. The company had grown the top line, but not the margin. It was scaling itself out of business. This kind of story is becoming more common as we move into the AI era. The old SaaS playbook of build a great app, charge monthly and let infrastructure fade into the background, doesn’t hold up when your core cost scales with usage. AI has reshuffled the value chain, and for startups, this shift is existential. The AI stack is deep and margin has moved In traditional SaaS, most of the value was captured at the application layer. Today, AI companies operate in a much deeper stack: But unlike the past, margins no longer concentrate at the top, close to the end user. They now often sit below the surface, especially in layers where scarcity exists such as hardware, compute and exclusive model access. So what can startups do when they don’t own the infrastructure or the models? Three moves founders can make to stay in the game 1. Own your data. It’s your new moat You don’t need to train your own foundation model, but you do need to own the inputs that make your product valuable. If you’re in a vertical such as healthcare, finance, real estate or legal, your advantage is proprietary, structured data. Fine-tune open models. Build lightweight adapters. Use your customer workflows to continuously collect differentiated data. The value is in the dataset. 2. Price for usage, not access That founder’s $800,000 cloud bill happened because they were charging like a SaaS company but operating like a compute company. In AI, usage drives cost. That means flat-rate subscriptions don’t work. Founders must embrace pricing models that align value delivered with cost incurred: Track gross margin by feature, not just customer. 3. Avoid model lock-in. Design for flexibility Tying your roadmap to one model provider like OpenAI or Anthropic is risky. Latency, pricing and policy changes can all blindside you. Instead, build with model abstraction in mind. Route across providers, fine-tune open-source backups, and negotiate contracts with leverage. Flexibility is not just technical. It is a business hedge. Itay Sagie is a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to Crunchbase News, and a seasoned lecturer. Learn more about his advisory services, lectures and courses at SagieCapital.com. Connect with him on LinkedIn for further insights and discussions. Illustration: Dom Guzman
Exclusive: Trucker’s Son Bucks Logistics Funding Decline with $40M Raise For Startup Alvys
Alvys, an AI-powered logistics software provider, has raised $40 million in Series B funding, the company tells Crunchbase News exclusively. RTP Global led the financing, which brings Alvys’ total funding to date to $77 million, according to the company. Alpha Square Group joined existing backers Picus Capita, Titanium Ventures and Bonfire Ventures, among others, in participating in the round. The company declined to reveal its valuation, saying only that it was an up round. It most recently raised funding in July 2024, a $25.8 million Series A led by Titanium. The raise comes at a time when funding to logistics and supply chain management startups remains far below pandemic highs. As of Sept. 25, startups in the space have raised $5.7 billion across 469 deals in 2025, Crunchbase data shows. By comparison, in all of 2024, logistics and supply chain management startups raised less than $6 billion in 741 announced funding deals. Both years’ numbers are a steep drop from the nearly $28 billion such startups raised in 2021 in a record-high 1,554 deals. Although 2021 was an aberration, funding numbers so far in 2025 are lower even than those of 2023, when $6.7 billion was raised across 965 deals. Making trucking more efficient Founded in 2020, Alvys hopes to buck the trend. The company describes itself as a “transportation management system” aimed at helping trucking companies operate more efficiently. Its platform does things like streamline dispatch, load management, tracking, driver management, billing and payroll. And by using AI and automation, Alvys claims it can help reduce manual work and help businesses make quicker decisions and thus move faster in general. Nick Darman, the company’s founder and CEO, told Crunchbase News that historically, many freight companies run on separate sets of systems, which results in siloed data, duplicated work, slow workflows and limited visibility. The company’s software “allows freight companies to transform multiple complex operations into one business that runs with clarity, while still keeping accounting clean and separate for each entity,” he said. The end result for the company’s 1,000-plus customers, Darman claims, is increased revenue, monthly loads and efficiency gains from faster accounting and reduced data entry. For its part, Alvys has tripled its revenue in each of the past two years and is on track to double it again in 2025, according to Darman. Personal experienceLeo Gorodinski, co-founder and CTO, and Nick Darman, founder and CEO of Alvys. Darman’s journey to start Alvys began with his personal experience seeing his father’s struggle — including financially — as a truck driver. After conducting research about freight sourcing, Darman founded a trucking company to supply his dad with loads. He also got a degree in economics and worked a brief stint in finance at JPMorgan. But in 2014, Darman decided to start an asset-based brokerage. By 2020, he had determined that he wanted to start a company to help address the inefficiencies plaguing the operating systems for freight companies. Thus, Alvys was born. In 2021, he invited Leo Gorodinski, former VP of engineering at Jet.com, to help him build Alvys. Julius Schwerin, partner at RTP Global, told Crunchbase News via email that the firm has repeatedly backed Alvys because the startup “marries a best-in-class TMS with the ambition to become logistics’ operating system. “What makes Alvys unique today is the combination of workflow depth and usability with 100+ integrations, built-in compliance, and real-time visibility, all wrapped in a modern interface that dispatchers and drivers actually enjoy using,” he added. Related Crunchbase query: Related Reading: Illustration: Dom Guzman
Biotech Share Of US Funding Hits Lowest Point In Crunchbase History
The share of U.S. startup investment going to biotech companies has hit the lowest level in more than 20 years, as an ever-growing proportion of funding goes to AI upstarts in other sectors. So far in 2025, investors have put $16.6 billion into seed through growth-stage rounds for biotech companies, per Crunchbase data. That pencils out to just over 8% of U.S. startup investment. It’s by far the lowest percentage in years, as charted below. In dollar terms, 2025 is also on track to show sharply lower biotech funding, even as overall venture investment to all sectors has been on the rise. Biotech previously pulled in a double-digit share It’s quite a shift. In past years, biotech has reliably pulled in a double-digit percentage of venture funding. While the proportion fluctuates from year to year, in most cases more than 15% of annual funding has gone to companies in Crunchbase biotech categories, based on a survey from 2007, our founding year, to the present. In some cases it’s even higher. In 2020, for instance, around 20% of reported investment went to companies in biotech categories. IPOs also down As we recently reported, biotech IPOs are also not having a moment. So far this year, just 18 funded U.S. startups in the biotech, drug discovery and medical device spaces have made their debuts on Nasdaq or the New York Stock Exchange, per Crunchbase data. That puts 2025 on track to deliver the lowest number of biotech IPOs in years. As we noted previously, the sluggish IPO pace is one of several indicators that investors are growing more risk-averse toward biotech and medtech. Many of the contributing factors are Trump administration-induced. These include cuts to public research funding, leadership upheaval at the Food and Drug Administration and public health agencies, and questions around future drug pricing policy. Slower early-stage funding and who is raising big rounds Slower early-stage funding is another concerning stat. It indicates that even if market enthusiasm for biotech rebounds, there will be a limited pipeline of companies ready to scale. So far this year, U.S. biotech startups have raised just $8.2 billion in seed and early-stage funding — on track for the lowest funding total in years. Even so, we have seen a few jumbo-sized early-stage financings this year. The largest include: At the later stages, meanwhile, the largest rounds went to Elon Musk’s Neuralink, and MapLight Therapeutics, which closed a Series D in July and filed to go public this month. The AI effect It should be reiterated that the shrinking share of funding going to biotech isn’t just the result of weaker investor enthusiasm for the space. Rather, it’s also a reflection of voracious investor appetite for AI companies, most of which aren’t categorized as biotech startups. For the first half of the year, for instance, startup investors put nearly $90 billion into North American AI deals, with OpenAI’s $40 billion SoftBank-led financing accounting for a big chunk of that. In Q3, the AI megarounds have continued to pile up, with Anthropic leading the way. And while biotech companies have historically secured some of the largest venture rounds in a given quarter, thus far they are nowhere close to competing with the GenAI giants when it comes to fundraising. Related Crunchbase queries: Related reading: Illustration: Dom Guzman
Timing The Market Is A Myth: Here’s How To Stay Ahead Of It
By Ashish Kakran Every founder has heard the advice: timing is everything. The uncomfortable truth is that timing is also nearly impossible to control. Being too early can kill a great company just as quickly as being too late. In fact, mistimed market entry is one of the top five reasons startups fail. Through my experience working with founders across AI, infrastructure and developer tools, I’ve come to believe the ideal go-to-market window isn’t about perfect timing. It’s about holding a small but critical edge or what I call the 1.5x edge. The 1.5x edgeAshish Kakran Think of it as being a half-step ahead of the market. If you’re two steps ahead, you may wait years for buyers to catch up. If you’re exactly in step, you risk being drowned out by noise and commoditization. But if you’re just slightly ahead, about six to nine months before the market really pulls, you have time to build an enterprise-ready product, win early design partners, and position yourself as the category leader when the wave crests. The best founders position their companies as leaders in markets that don’t yet exist. At the same time, they close revenue in adjacent use cases that buyers already care about. It’s a delicate balance of vision and pragmatism. Lessons from markets that were too early A few years ago, MLOps companies built sophisticated tools to manage dozens of models in production, including fine-tuning, monitoring and observability. The problem? Almost no one had that many models in production. The technology was brilliant, but the buyers weren’t there yet. Many of those startups failed not because of a bad product or bad teams, but because they were solving tomorrow’s problem today. Fast-forward to now: With LLMs and GenAI, the market has finally caught up. Suddenly, everyone needs robust MLOps and LLMOps. The pain is real, and the timing works. When the wave hits Look at AI code generation. Early players such as GitHub Copilot and Tabnine built strong products, but the market wasn’t ready. Then came ChatGPT, which shifted perception and normalized AI as a daily tool. Cursor and Windsurf didn’t invent a new model. They combined standard IDEs with APIs from OpenAI and Anthropic to create an integrated developer workflow. The timing was perfect. Distribution and adoption followed naturally. The takeaway: You can’t “time the market.” But you can be prepared when the moment arrives. It is teams of nimble founders that can rapidly adapt to the changing market conditions who are likely to win. The rate of change with AI is both a challenge and an opportunity. On one hand a new model release can make a subcategory obsolete. On the other hand, best founders see it as an opportunity to discover interesting new use cases as their competitors fight for survival. How founders can calibrate So how do you know if you’re too early or just early enough? Talk to customers and prospects, constantly. Many technical founders fall into the trap of selling the brilliance of their tech rather than listening to real pain points. Beware of the shiny-object syndrome. I have seen meetings where exceptionally talented founders spent 30 minutes in front of top CIOs and just kept talking about the cool technology. It can be a wasted opportunity as the buyer might walk away not knowing what the company actually does. Discovery matters. If your ICP doesn’t understand what you’re solving, they won’t buy it. Founders should also look beyond the C-suite. Champions can sit a level or two below, where up-and-coming leaders are hungry to bet on new technologies that accelerate their careers. These champions can make or break your early deals. Another key: over-deliver in the first six to 12 months. Close early design partners with favorable terms, but make sure they feel real ROI. Turn them into internal champions who will fight for you in rooms you’re not in. Churn at this stage can be devastating, not just to metrics but to founder morale. Why staying ahead still matters Even if you find the edge, it won’t last forever. Competitors will catch up. Markets will shift. The only way to maintain an advantage is through relentless product innovation and customer closeness. As Jyoti Bansal, founder of Harness 1, once said: “You don’t want to cross $100 million ARR with a single product.” The best enterprise companies continually invest in the next product about two years before the market needs it, ensuring there’s always a new growth driver ready. Timing the market may be a myth, but staying ahead of it isn’t. By keeping a 1.1x to 1.3x edge, slightly ahead of buyer demand but close enough to capture real use cases, founders can avoid the trap of being “too early to matter” and position themselves as the leaders when markets shift. The edge is small, but it’s everything. Ashish Kakran is a partner at Sierra Ventures, where he invests in early-stage companies in AI, infrastructure and cybersecurity. Previously, he has backed founders building category-defining companies such as Cohere and Harness. Related Crunchbase query: Related reading: Illustration: Dom Guzman
The Week’s 10 Biggest Funding Rounds: Health And AI Lead For Large Financings
Want to keep track of the largest startup funding deals in 2025 with our curated list of $100 million-plus venture deals to U.S.-based companies? Check out The Crunchbase Megadeals Board. This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out last week’s biggest funding rounds here. This week was a fairly busy one for large financings, with eight of the top 10 exceeding the $100 million mark. Leading the way were two software providers: Judi Health, focused on health benefits software, and Filevine, used for legal practice management. 1. (tied) Judi Health, $400M, health benefits: Judi Health, formerly known as Capital RX, a New York-based provider of software for employers and health plans to manage benefits, announced $400 million in new investment. The financing included a $252 million Series F round along with what the company described as additional investments into its securities, led by Wellington Management and General Catalyst. 1. (tied) Filevine, $400M, legal tech: Salt Lake City-based Filevine, a provider of legal practice management software, announced that it closed on two previously undisclosed rounds totaling $400 million. Insight Partners led the first round and joined Accel and Halo Experience Co. to co-lead the second. 3. Modular, $250M, AI infrastructure: Modular, developer of an enterprise AI inference stack, raised $250 million in a Series C financing led by US Innovative Technology Fund at a $1.6 billion valuation. Founded in 2022, the Palo Alto, California-based company has raised $380 million in known funding to date. 4. AppZen, $180M, fintech: San Jose, California-based AppZen, an agentic AI platform for finance teams, picked up $180 million in Series D funding led by Riverwood Capital. The company said it wants its software to enable CFOs and controllers to replace over 50% of manual work. 5. Distyl AI, $175M, enterprise software: Distyl AI, a developer of AI tools for enterprise customers, scooped up a $175 million funding round backed by Lightspeed Venture Partners, Khosla Ventures, DST Global, Coatue and Dell Technologies Capital. The financing sets a $1.8 billion valuation for the San Francisco-based company. 6. Empower Semiconductor, $140M, AI processors: Empower Semiconductor, a developer of power-efficient AI processors, closed on more than $140 million in Series D financing led by Fidelity. The San Jose, California-based company says its technology can enable energy savings and higher throughput of AI platforms across data centers. 7. Quo, $105M, business communications: San Francisco-based Quo (formerly OpenPhone), raised $105 million in fresh financing led by General Catalyst. The company offers an AI-powered phone system marketed to small businesses. 8. Zerohash, $104M, cryptocurrency: Crypto and stablecoin infrastructure startup Zerohash raised $104 million in a funding round led by Interactive Brokers Group. Founded in 2015, the Chicago-based company has raised $277 million in known funding to date, per Crunchbase data. 9. Inspiren, $100M, healthcare AI: New York-based Inspiren, developer of an AI-powered platform and connected-device system for senior living communities, secured $100 million in a Series B round led by Insight Partners. 10. Thyme Care, $97M, oncology care: Thyme Care, a Nashville, Tennessee-based startup that describes itself as a provider of “value-based care” for oncology patients, picked up $97 million in Series D financing from a long list of venture and strategic backers. Methodology We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the period of Sept. 20-26. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week. Illustration: Dom Guzman
The Arc Of Venture Capital Bends Toward Democracy
By Ben Miller Once upon a time, tech founders built toward IPOs — not tender offers. In 1999, the median tech startup went public just five years after its founding. Today, that figure has stretched to 14 years. Instead of ringing the opening bell, founders are increasingly turning to private liquidity, keeping equity locked in private hands long past the company’s breakout success. That shift has created a far bigger — and increasingly private — pie. In 2005, the combined value of the 50 most-valuable private U.S. tech companies was less than $5 billion. Today, that number stands at $1.8 trillion. Over the same period, private markets have matured from niche pools into deep oceans, with global private-market assets under management surpassing $15 trillion — up from just $100 billion in the mid-1990s, a 150x increase. As a result, we’re entering an era where the most transformative value — like the $20 trillion impact projected from AI — could be created almost entirely within private markets, widening the wealth gap between insiders and everyone else. The long-standing objections to broader VC participation — risk, illiquidity, transparency and fees — are rapidly losing relevance. Let’s take them one by one. ‘Venture capital is too risky’Ben Miller Risk is not monolithic. Late-stage companies such as Stripe, Databricks or Canva look far more like mid-cap public equities than garage-stage moonshots. Investors can capture meaningful upside and diversify against individual company blow-ups by thoughtfully constructing a portfolio of 30 to 40 late-stage (post-Series C) funding rounds. ‘But it’s illiquid’ Illiquidity is relative. Half of U.S. public equities are already locked in passive funds that rarely trade. Meanwhile, the private secondary market hit a record $162 billion in transaction volume in 2024 — and continues to grow. Publicly registered VC funds can also hold 20% to 30% of assets in stocks or Treasuries to meet redemptions, bridging short-term liquidity needs with long-term exposure. ‘There isn’t enough oversight’ That’s changing. New publicly registered, evergreen VC funds, like the Fundrise Innovation Fund, are subject to SEC filings, audited financials and daily NAV disclosures. Retail investors are now getting more transparency in private markets than they do in many traditional mutual funds. ‘The fees are outrageous’ Historically, yes. 2% management fees plus 20% carry were the norm. But new models are emerging. The Fundrise Innovation Fund, for instance, owns equity in nine of the 10 most well-known private U.S. tech companies — including OpenAI and Anthropic — and charges no carried interest, only a flat 1.85% management fee. So why democratize VC now? Momentum is finally on the side of access. In June 2025, the House passed the Fair Investment Opportunities for Professional Experts Act in a 397-12 landslide, directing the SEC to open private markets to knowledgeable investors, regardless of net worth. The scale of the opportunity is enormous. Missing out on a $20 trillion AI wave isn’t just unfortunate — it’s locking out the majority of Americans of a generation-defining creation of wealth. Private tech also provides diversification in an era when public portfolios are dominated by the “Magnificent Seven.” And with 60% of public equity assets held passively, denying those same long-term investors access to private growth feels increasingly arbitrary. Venture capital will always carry risk — but so did buying Amazon in 1997 or Nvidia in 2015. What’s changed is the timeline: Today, the lion’s share of value is created before companies ever go public. Publicly registered VC funds are a breakthrough. They pair regulatory oversight with access to innovation, offering everyday investors a chance to participate in the upside of early-stage growth. Just as ETFs transformed public markets, these vehicles could reshape the future of private capital. The arc of innovation bends toward abundance. It’s time for venture finance to bend with it — toward the many, not the few. Ben Miller is the CEO and co-founder of Fundrise, the leading direct-to-consumer alternative investments manager. Related reading: Illustration: Dom Guzman
5 Interesting Startup Deals You May Have Missed In September: A Better Insulin Patch, Maternal Mental Health Care, And A Non-Humanoid Robot
This is a monthly column that runs down five interesting startup funding deals every month that may have flown under the radar. Check out our August entry here. While AI startups continue to get the lion’s share of venture funding, this month most of the startups that caught our attention weren’t centered around artificial intelligence. Rather, they include a startup making a more environmentally friendly fertilizer, a mental health platform for new and expecting mothers, and a medical device company aiming to make a better insulin patch for people living with diabetes. Let’s take a look. $85M for a cooler insulin patch One of the companies that caught our eye this month is ViCentra, a Dutch startup with an insulin patch pump designed to look and feel more like a trendy tech gadget than a medical device. The Netherlands-based company raised $85 million in Series D funding in early September. Its round comes as diabetes is becoming more prevalent worldwide, with the insulin pump market projected to reach more than $14 billion by 2034. Of that, patch pumps — small, tubeless devices that adhere directly to the skin and deliver insulin continuously without the need for external tubing — represent the fastest-growing market segment. ViCentra makes Kaleido, a small, sleek, waterproof insulin patch pump that comes in an array of bright, sparkly colors similar to iPhone hues. The device also integrates with a cloud platform where users can track their glucose levels, sleep, and diet and exercise insights that they can then choose to share with doctors or family members. “Kaleido is a true disruptor — small, discreet, featherlight, and beautifully designed,” ViCentra CEO Tom Arnold said in the funding announcement. “It empowers people with diabetes by offering a more personal and distinctive choice in both function and style. Built with empathy and precision, it honors those who live with diabetes every day. With this funding, we can now meet surging European demand and fast-track our entry into the U.S. market.” The company’s Series D was led by new investor Innovation Industries, with matching participation from existing investors Partners in Equity and Invest-NL. Previous investors EQT Life Sciences and Health Innovations also joined. Environmentally friendly fertilizer gets a $50M boost We typically think of things like power plants, vehicles and industrial factories when we consider the top contributors to greenhouse gas emissions. A less commonly known culprit: agricultural fertilizers. But fertilizers to grow crops — traditionally done through what’s known as the Haber-Bosch method — are estimated to generate more than 2% of greenhouse gas emissions. The Haber process produces ammonia by reacting nitrogen from the air with hydrogen (usually from natural gas) under high temperature and pressure, using an iron catalyst. Ammonia is the key ingredient in most nitrogen-based fertilizers, making the process critical for large-scale crop production worldwide. But while traditional fertilizers have enabled mass food production, they also create a lot of negative externalities. Among them are high energy use and emissions, resource dependency on natural gas for hydrogen, environmental degradation and biodiversity loss. A San Francisco-based startup, Nitricity, has a different approach. The company this month announced $50 million in Series B funding and broke ground on its new organic fertilizer plant in California’s Central Valley. There, it will use renewable power to produce its organic, nitrogen fertilizer liquid, called Ash Tea, made from recycled organic almond shells, air and water. The company says Ash Tea is cost-competitive with other commercially available organic fertilizers, but is more environmentally friendly and free from pathogens and animal products. Field trials of the product have reportedly shown up to 30% increases in yield. Nitricity’s pilot factory in Fremont, California, currently produces 80 tons of fertilizer per year, which treats around 80 acres of crops. The company says all of its current production is spoken for and it has $150 million in its sales pipeline. The new factory is expected to begin operation next year and will mark a 100x production increase, according to the company. “This is an inflection point for Nitricity. We’re scaling across the U.S. and we’re very excited to expand into Europe in a serious and assertive way. The European market for our organic fertilizer is even larger than in the U.S., and demand is only growing against a backdrop of European governments looking to boost resilience and create circular agriculture economies,” Nitricity co-founder and CEO Nicolas Pinkowski said in a statement. Its Series B was co-led by new investor World Fund and returning investor Khosla Ventures. Other participants included Chipotle‘s Cultivate Next venture fund, Change Forces, Susquehanna Sustainable Investments, Energy Impact Partners and Fine Structure Venture. $10.8M for a toothbrush that does the work for you Toothbrushes haven’t changed much since the first electric one came on the market in the 1950s. But ZeroBrush is one of a handful of funded startups working on changing how we clean our teeth with oral cleaning devices designed to be customized, more efficient and more effective. The Palo Alto, California-based company this month announced $10.8 million in funding to launch what it calls “the world’s first full-mouth oral cleaning device.” The brush is fully automated, “cleaning all 192 tooth surfaces simultaneously with custom-fit, 3D-printed mouthpieces and sonic-powered bristles.” The company claims that early testing shows its device removes nearly twice as much plaque in half the time of manual brushing. ZeroBrush was founded by cosmetic dentist Dr. Nidhi Pai and product innovator Akash Pai. Its investors include Social Capital and an unnamed “large CPG strategic,” angel investors and a Meta senior executive, the company said. “ZERObrush is not just an incremental improvement — it’s a completely new category of oral hygiene that brings professional-level cleaning to everyday routines,” Dr. Pai said in a funding announcement. The company is one of several funded startups working on custom oral hygiene devices. Another is Proclaim, which makes a full-mouth flossing device and has raised $15 million in funding. $8M for better maternal mental health care While bringing a new baby into the world is for most people a joyous occasion, it’s also often one of the most difficult and challenging experiences of a mother’s life. It’s not just the physical recovery that follows childbirth, either: In fact, perinatal mood and anxiety disorders affect an estimated 1 in 5 women, making them the most common complication of childbirth. And yet, an estimated three-fourths of women diagnosed with postpartum mood or anxiety disorders never receive treatment, whether that’s due to perceived stigma, provider shortages, insurance limitations or other access issues. That lack of treatment can have devastating consequences: Suicide and overdose are the leading causes of maternal death in the U.S. in the first year postpartum. This month, Seven Starling, a New York-based startup, said it has raised $8 million in new funding to expand its maternal mental health platform, focusing on treating women during fertility challenges, pregnancy, postpartum and early parenthood. Rethink Impact led the round. Pear VC, Zeal Capital Partners, Magnify Ventures, Ulu Ventures, Expa, Fiore Ventures, March of Dimes, Rogue Women’s Fund and Graham & Walker also participated. The company, which has now raised $22.4 million, per Crunchbase, said it already operates in 18 U.S. states and has partnerships with over 1,500 OB-GYNs. With the new funding, it plans to expand to more than 30 states by the end of 2026. The company says it maintains in-network coverage with health insurers Anthem, Aetna, Cigna and United Healthcare, and has expanded coverage options including Medicaid programs in a growing number of markets. “We saw an opportunity to build something different by working directly within the healthcare system rather than working around it,” CEO and co-founder Tina Keshani said in a statement. “Our provider-integrated approach ensures women get specialized care at the moment they need it most.” $1.5M for a robot that doesn’t try to be human Robotics funding recently hit a multiyear high, boosted by a billion-dollar round for humanoid robotics startup Figure. But smaller startups working on robots — humanoid or not — are raising cash, too, many of them with industrial or workplace applications. One of the latest is MicroFactory, which makes a tabletop robot designed to do repetitive manual work such as electronics assembly. The San Francisco-based company earlier this month announced $1.5 million in pre-seed funding from investors including Hugging Face co-founder Clement Delangue and early Uber and Twitter investor Naval Ravikant. MicroFactory’s robots are priced around $5,000. Unlike the humanoid robots being developed by many funded startups, the company’s general-purpose bots are small enough to fit on a desktop, and in a compact-box-shaped frame. Their robotic arms are designed to work with interchangeable tools and can perform tasks including precision soldering and screwing, cable routing, peeling adhesive films or plastic layers, and light-duty food processing and packaging. “You don’t need a humanoid robot to automate tabletop work,” co-founder and CEO Igor Kulakov said in a statement. “Our robot design allows us to automate tasks with the current state of robotic AI models and hardware.” Since they don’t need legs, complex human-like fingers, or batteries, MicroFactory’s machines are also much simpler — and cheaper — to manufacture than their humanoid counterparts, according to the company. MicroFactory says it has secured paid reservations from more than 100 customers in industries ranging from electronics assembly and textiles to food processing and laboratory automation. The first units are expected to ship in early 2026. Related Crunchbase queries: Illustration: Dom Guzman
Who Is Governing AI Companies? For Nearly Half Of AI Startups In California, The Answer Is Only Men
By the California Partners Project, Crunchbase and illumyn Impact This report was produced through a collaboration between the California Partners Project, illumyn Impact and Crunchbase. Executive summary If social media has taught us anything, it’s that new technologies can have widespread and often unanticipated effects. They can change not only how we work but also how we think and how we relate to each other. Artificial intelligence has an unprecedented potential to shape our future in exciting and unforeseeable ways. As business leaders and government agencies around the world grapple with the responsibility of managing the risks that accompany the promised rewards of AI, one immediate and evidence-based place to start is building a diverse board of directors. Yet our research indicates that, on that front, AI company boards fall woefully short. Boards that fail to reflect a wide range of experiences and viewpoints are not well-positioned to oversee companies whose products may determine how bank loan applications are evaluated, how healthcare issues are diagnosed, or how educational resources are allocated. Although no single measure can ensure responsible AI development, diverse board leadership is vital for companies creating technologies that will fundamentally reshape how we live, work and interact. Within this study, we look at gender diversity, which is reasonably measurable, as a proxy for diversity of perspectives, life experience, areas of expertise and other demographics. To understand the gender mix on AI boards, we analyzed the board composition of more than 140 AI companies headquartered in California, where venture-backed AI development is concentrated. Our study focused on 102 private companies that have raised at least $50 million in cumulative funding. As we’ve seen time and again, transformative innovations are as likely to come from today’s nascent startups as they are from established industry leaders. Governance of these companies during their high-growth, pre-IPO period is arguably as important as it is after they go public. We also looked at the boards of 39 publicly traded AI companies for comparative purposes. Our analysis revealed a striking lack of gender diversity among the people who govern some of the world’s most influential AI startups. Women comprise only 15% of the boards of private AI companies. More than 40% of these private boards don’t have any women directors. Two root causes contribute to this gender disparity — one structural and one behavioral. First, investors and founders collectively hold the majority of private company board seats, and women are still underrepresented in those categories. Second, when appointing independent directors, boards often limit their consideration to familiar candidates instead of seeking qualified experts outside their immediate networks. The good news: There are plenty of executive women and people of color on the cutting edge of AI innovation who are ready to bring their voices and operating expertise to the boardroom. Companies that prioritize building a diverse board need only to look beyond their existing networks to find a wealth of AI board talent. Consider this precedent: Five years ago, one-third of all public companies in California had no women board members. With focus and effort, all-male boards are now the rare exception. Given the rapid pace of AI development, companies need to act now, while the technology and its applications are still emerging. CEOs and board members who bring more women and people of color into their boardrooms will help create a productive and healthy AI-powered future for all of us. Key findings Among the AI companies headquartered in California included in our study: Women average just one seat in AI boardrooms Across all of the California-based AI private companies studied, women hold an average of one seat on a six-person board. Among 102 private companies, only five boards (5%) have an equal or greater number of women than men in the boardroom. More than 40% of private AI companies have all-male boards Among the over 100 privately held AI companies headquartered in California included in our study, 44 (43%) don’t have any women in the boardroom. Gender diversity is slightly higher on the boards of companies with more capital. Among those with cumulative funding of at least $50 million but less than $100 million, 62% have all-male boards. For companies with at least $100 million in funding, that number drops to 32%. This shift likely stems from the addition of independent directors who bring operational and market expertise. Among publicly traded companies, women hold an average of two board seats, double the average among private company boards. Research suggests that, to capture the full economic benefits of diversity, boards should include at least three women directors. Just half of the public companies we studied meet that threshold. For private company boards, independent director appointments offer the fastest route to diversity Most private company board seats (72%) are held by company executives (the CEO and co-founders, typically) and early investors. Women hold only 10% of these board seats, a reflection of the underrepresentation of women among venture capital investors and the entrepreneurs they fund. Women hold less than 20% of investing partner roles in venture capital firms. Companies with women-only founders secured just 3% of AI venture funding in 2023, a number stagnant since 2015. More than half (55%) of the women directors included in our study hold independent board seats. That is, they are neither tied to the company’s founding or management team nor investors in the company. Whereas public companies must have a minimum number of independent directors, private companies have no such requirements. Therefore, independent directors are typically added later in a company’s lifecycle, often as part of preparation for an IPO. The percentage of companies without any independent directors decreases as the level of funding increases — from 36% for those with $50 million to $99 million to 21% for those with $100 million or more. Our findings suggest that women are more likely to be appointed to private company AI boards as the second independent director. On boards with only one independent director, women hold 17% of those independent director seats. Among companies with more than one independent director, 67% had at least one woman in that role. Summary Women are underrepresented on the boards of AI companies — especially high-growth, earlier-stage startups. While board diversity is not a panacea, it is one essential element for the companies developing technology with the potential to influence society in profound ways. To increase the number of women board members, companies should: Companies don’t need to trade off technical expertise and governance experience to bring diverse voices into their AI boardrooms. They simply need to look beyond their immediate networks. Methodology This study follows the methodology utilized in the annual Him For Her and Crunchbase studies of diversity on private company boards. Leveraging the Crunchbase database, we identified 409 companies in the AI industry with headquarters in California. Among them were 40 publicly traded companies and 369 privately held companies with at least $50 million in cumulative funding as of July 1, 2024. To ensure that each company’s board profile was current, we included only companies that publish their board of directors on their website. We then referenced company website data, Crunchbase profiles and other publicly available information to characterize the board members. The study included only board directors; board observers and/or advisers were excluded from the data set. For private company boards, we segmented board members according to type of board seat: executive, investor or independent. In the few cases in which founders and past executives remained on the board despite no longer having an operating role at the company, we classified them as “executive directors” in recognition of their original relationship to the company. We identified gender by referencing professional profiles on Crunchbase and, when not available, other sites. About the authors Co-founded by California First Partner Jennifer Siebel Newsom and Olivia Morgan in partnership with the people of California, the California Partners Project is dedicated to championing gender equity across the state and ensuring our state’s media and technology industries are a force for good in the lives of all children. The California Partners Project tracks and spotlights women’s representation on corporate boards and offers an Inclusive Boards Playbook Series developed in partnership with Stanford’s VMware Women’s Leadership Innovation Lab with strategies for board refreshment and culture-building. For more information about the nonprofit organization, visit www.calpartnersproject.org. Connect with the California Partners Project on LinkedIn and Instagram. Crunchbase is a predictive intelligence solution that forecasts private-market movements using the unique combination of live private company data, AI and market activity from more than 80 million users. It helps investors, dealmakers and analysts be the first to find and act on opportunities. To learn more, visit crunchbase.ai and follow Crunchbase on LinkedIn and X. illumyn Impact (formerly Him For Her) is a social impact organization with a mission to diversify the board ecosystem, which is building and shaping the future: from healthcare, to AI, to climate change and beyond. Drawing from its ever-growing referral-based talent network of 8,000+ under-networked executives, a third of whom are women of color, illumyn Impact makes highly curated introductions that bring fresh expertise into the boardroom. illumyn Impact is proud to partner with 100+ leading private equity and venture capital firms. A 501c3 corporation, illumyn Impact operates through the generosity of its founding partners GV, IVP, L Catterton, Mayfield Fund, Silver Lake Partners, SoftBank, Starboard Value and Tiger Global Impact Ventures, and supporters like Brad Feld and Amy Batchelor, Reid Hoffman, Jeff Weiner, Nasdaq and many others. Its sister organization, illumyn, supports underrepresented executives in some of the world’s largest companies through its corporate boardroom excellence fellowship program. Illustration: Dom Guzman