Small Notes on Big News

The TechCrunch Exchange: A Weekly Startup and Market Update

Greetings, and welcome to this week’s edition of The TechCrunch Exchange, a newsletter focused on the startup ecosystem and market trends. This publication draws inspiration from the daily TechCrunch+ column of the same name.

The pace of news remains relentless, even as we approach the latter part of December. Contrary to expectations of a seasonal slowdown, significant developments continue to unfold.

Key News and Observations

The Decline of SPACs: Predicting the definitive end of any market trend is often unwise, yet the situation surrounding Trump Media’s SPAC is becoming increasingly concerning. The BuzzFeed SPAC deal’s struggles, culminating in a public listing followed by a substantial value decline, further reinforces this trend. Is this the end? It certainly appears so.
Crypto and Traditional Finance: The debate between cryptocurrency and traditional finance continues. The tech industry must determine the optimal methods for funding and developing crypto-based ventures. Venture capital may not be the sole answer. OpenSea IPO expectations were met with user disapproval, prompting questions about the benefits of remaining within the crypto space via token issuance rather than pursuing a public offering.
Shifting SaaS Valuations: A notable and rapid decrease in software company valuations has recently been observed. While valuations remain elevated, they are significantly lower than previous levels. This presents a challenge for overpriced unicorns in the sector.
Instacart Leadership Change: Instacart recently experienced a departure of its president, just months after her appointment. Previous reporting indicated a deceleration in Instacart’s growth following the surge experienced during the pandemic. While the company continues to grow, the slower rate may impede its ability to launch a successful IPO at a desirable valuation.

Further Insights

The current market landscape presents both challenges and opportunities for startups and investors. The evolving dynamics between crypto and traditional finance, coupled with shifting valuations in the SaaS sector, require careful consideration.

The Instacart situation highlights the importance of sustained growth and realistic valuation expectations for companies seeking to go public. Maintaining momentum is crucial for achieving a successful IPO.

The coming weeks will likely reveal further developments in these areas, shaping the future of the tech industry.

Exploring Company Visibility and the Rise of Vector Search

One of the most rewarding aspects of technology journalism is engaging with insightful individuals who can illuminate future trends. This isn't about speculative concepts like the metaverse, but rather about technologies poised to fundamentally alter how information is managed.

Introducing Bob van Luijt, the CEO and co-founder of Semi Technologies. His company is developing Weaviate, a project that exemplifies the growing trend of for-profit open-source software (OSS) companies. Essentially, Semi Technologies is constructing a business model around an open-source project – specifically, Weaviate.

Bob generously dedicated several hours to explaining his company, the market for unstructured data searching, and the mechanics of Weaviate. He also processed TechCrunch’s 2021 content and presented it within a user-friendly interface for demonstration purposes.

This approach represents an effective strategy for attracting media attention to your company. While the data scraping was a thoughtful addition, the core principle lies in patiently addressing questions, even when they require revisiting familiar territory.

Now, let's discuss vector search. Weaviate facilitates rapid searching of unstructured data. Microsoft defines vector search as utilizing deep learning models to convert data into vector representations, where the distance between vectors indicates the similarity of items.

Bob clarified this concept with a practical example. Traditional databases store data like the Statue of Liberty’s location in New York City and the Eiffel Tower’s in Paris. However, retrieving this information requires precise queries. Vector search – through Weaviate or similar tools – enables you to ask the database for information about landmarks in France, and the Eiffel Tower data will be returned.

Remarkably effective, isn’t it? While experimenting with the TechCrunch portal created by Bob’s team, I found a particular query compelling: “Who authors the TechCrunch newsletter during Alex Wilhelm’s absence?” This query’s ambiguity is noteworthy. Which newsletter is referenced, and what constitutes being out? Nevertheless, the search results successfully identified a passage from this very article mentioning my temporary leave and Anna’s newsletter coverage.

Impressive. Semi Technologies is a relatively new venture, but one I’m closely monitoring. This is primarily due to my interest in open-source startups, which often exhibit a more balanced approach to business compared to their closed-source counterparts. Furthermore, I appreciate Bob’s perspective.

Further insights will be shared once I’ve refined my extensive notes – nearly 3,000 words – from my conversations with Semi into a more concise and organized form.

Anna's Top Picks from 2021:

Fiction:

Born to be Mild: Adventures for the Anxious, by Rob Temple

This publication marked the beginning of my reading journey in 2021, and its impact has endured over the past twelve months. Readers may recognize the author, Rob Temple, from his popular social media presence and the “Very British Problems” book series. However, this work distinguishes itself as a candid exploration of his experiences with anxiety and his efforts to expand beyond his comfort zone. It’s a poignant, relatable, and frequently humorous read – particularly for those who appreciate the style of Sue Townsend.

Nonfiction:

How to Read Numbers: A Guide to Statistics in the News (and Knowing When to Trust Them), by David Chivers and Tom Chivers

I am currently engaged with this book, though my progress is not yet complete – it demonstrates considerable promise. It may contribute to existing criticism of media reporting, but it rightly asserts that statistical data presented in news coverage requires careful scrutiny. This makes it an invaluable resource for both journalists and news consumers. Increased proficiency in interpreting numerical information will undoubtedly lead to more insightful analysis.

Alex's Favorite Reads of 2021:

The Salvation Sequence, by Peter F. Hamilton

Truly exceptional science fiction transcends mere technological embellishment of our existing world. The most compelling examples fundamentally reshape our understanding of economics, humanity, science, and the very laws of physics. Hamilton’s “The Salvation Sequence” achieves this, offering a comprehensive exploration of economics, alien encounters, the essence of humanity, and future political landscapes. It’s an immersive and captivating experience, and I eagerly anticipate rereading the entire series upon the release of the next installment.

A Memory Called Empire and A Desolation Called Peace, by Arkady Martine

The future can be envisioned in numerous ways. Martine constructs a future where the concepts of civilization and barbarism intersect with art, empire, and, crucially, memory. Hidden technologies and the realities of war are also central themes. The depth and artistry of Martine’s sci-fi universe surpass simple categorization as science fiction; it is a truly remarkable achievement. This warrants the highest commendation.

Black Sun, by Rebecca Roanhorse

Fantasy literature frequently relies on tropes derived from European feudal history. The predictable narrative of a troublesome duke and subsequent peasant uprising is all too common. Roanhorse’s “Black Sun” offers a refreshing departure from this convention. Drawing inspiration from the traditions of South and Central America, it delivers a thrilling and original reading experience. It is an absolute must-read.

The Last Graduate, by Naomi Novik

Novik consistently demonstrates exceptional writing talent. Both “Uprooted” and “Spinning Silver” were highly successful novels. However, in my opinion, her most impressive work is “A Deadly Education,” released in late 2020. This sparked an immediate anticipation for its sequel, “The Last Graduate.” It is unusual for me to eagerly await a book’s release, but this was an exception. “The Last Graduate” proved to be outstanding. If you seek a unique protagonist and a world brimming with danger, these books are essential reading. You won’t regret it.

Alex