Crunchbase promised no layoffs five months ago, but A.I. has since altered the situation.

Crunchbase promised no layoffs five months ago, but A.I. has since altered the situation.

Crunchbase’s Transformation and the Impact of A.I.

Crunchbase, a popular startup that provides data and fundraising information on private companies and investors, recently underwent significant changes. The company, backed by Mayfield and OMERS Ventures, had to lay off a significant number of employees in its go-to-market teams, including sales and marketing. The layoffs were prompted by a realization made by the company’s executive team: the rise of artificial intelligence (A.I.) posed an existential threat to their business. In an interview, Crunchbase CEO, McConnell, emphasized the need to hire more data scientists and engineers to stay ahead in an A.I.-first world. This decision required the company to rethink every aspect of its business, from data sourcing to delivery.

Crunchbase currently relies on a combination of user data, data partnerships, and A.I. tools developed by its data teams. However, the company plans to double its data engineering teams and expand its capabilities in machine learning. To fund these initiatives, layoffs were unfortunately necessary. Despite the challenges, Crunchbase remains optimistic about the future, with plans to develop a model for automated company descriptions and a new search function. The company aims to enhance user interactions with data and even incorporate predictive capabilities.

The hiring of Chief Product Officer Megh Gautam further emphasizes Crunchbase’s dedication to embracing A.I. in their operations. However, Crunchbase is not the only company experiencing this wave of generative A.I. across the business ecosystem. Many companies are exploring ways to leverage large language models to transform their operations. This trend, while exciting, also carries consequences for preexisting jobs. As companies shift their focus to A.I., they often find the need to restructure their workforce, leading to layoffs and job losses.

The impact of A.I. on jobs has been a growing concern, with thousands of people already being laid off due to cost-cutting in the tech and startup industry. McConnell acknowledges the mistakes made and expresses regret for not anticipating the impact of A.I. sooner. He takes responsibility for the hardship faced by the affected employees.

The changes happening at Crunchbase are just one manifestation of this evolving landscape. More companies are likely to follow suit, reshaping their business structures to accommodate the expanding role of A.I. in their operations. While these changes may bring technological advancements and improved efficiency, they also represent a significant shift in the employment landscape.

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Venture Deals:

• Airalo, an eSIM connectivity provider, raised $60 million in Series B funding. The round was led by e& Capital and included participation from Antler Elevate, Liberty Global, Rakuten Capital, Singtel Innov8, Surge, and others.
• Kyverna Therapeutics, a clinical-stage cell therapy company, raised $60 million in an extension of its Series B funding. Investors include Bain Capital Life Sciences, GordonMD Global Investments, Gilead Sciences, Westlake Village BioPartners, Vida Ventures, Northpond Ventures, RTW Investments, Insight Partners, CAM Capital, LYFE Capital, and others.
• TytoCare, a virtual care company, secured an additional $49 million in funding. The round was led by Insight Partners and included participation from MemorialCare, Healthcare of Ontario Pension Plan, and Clal.
• Lula, an insurance infrastructure platform, raised $35.5 million in Series B funding. NextView Ventures and Khosla Ventures co-led the round, with participation from Founders Fund, Plug and Play Ventures, and others.
• Transcend Software, a provider of generative design tools, raised $20 million in Series B funding. The round saw participation from Autodesk, HG Ventures, PureTerra, Arosa Capital, and Riverstone Holdings.
• Haus, a growth platform for brands, raised $17 million in Series A funding. Insight Partners led the round, joined by Baseline Ventures, Haystack Ventures, Upside Partnership, Octave Ventures, and Mantis Venture Capital.
• HOLOGATE, an extended reality solutions company, raised €8.3 million ($9.09 million) in Series A funding. Bolero Holdings and Vester Partners co-led the round, with participation from Cherry Ventures.
• Functional Finance, a software platform for insurance companies, raised $8 million in seed funding and $2 million in SAFE funding. New Enterprise Associates led the round, joined by Walkabout Ventures, Altai Ventures, C.V. Starr Insurance, and others.
• Orbital, a finance and crypto solutions platform, raised £5 million ($6.35 million) in funding. The round was led by Golden Record Ventures and included New Form Capital, GSRV, Psalion, and Luminous Futures.
• Acelab, a building product selection company, raised $5.3 million in funding. Pillar VC, PJC, and Draper Associates co-led the round, with participation from Alpaca, Transcend Partners, Branagh Construction, and others.
• Reflex, an open-source app-building and development framework, secured $5 million in seed funding. Lux Capital led the round, joined by Abstract Ventures, Box Group, Y Combinator, Picus Capital, and Outset Capital.
• EMTECH, a central banking software platform, raised $4 million in seed funding led by Matrix Partners India.
• Polars, a DataFrame library for data scientists and engineers, raised $4 million in seed funding led by Bain Capital Ventures.
• Divirod, a flood management and water risk analytics company, raised $3.6 million in bridge funding. Investors included GHD, Thin Line Capital, and TDK Ventures.
• Jericho Security, a cybersecurity startup, secured $3 million in pre-seed funding. The round was led by Era, with participation from Lux Capital, FoundersXFund, MetaLabs, Alcove, Textbook, Alumni Venture Group, Thorntree, Contrary, and others.

Private Equity:

• CoreMedia, a portfolio company of OpenGate Capital, acquired BySide, a SaaS customer journey and engagement solutions provider, and Smarkio, a SaaS chatbot solutions provider, both based in Porto, Portugal. The terms of the deal were not disclosed.
• Mubadala Investment Company acquired a minority stake in Aligned Data Centers, a data center company based in Plano, Texas. Financial details were not disclosed.

Other:

• SimplePractice agreed to acquire the assets of Luminello, an electronic medical record and practice management platform based in San Francisco. The terms of the acquisition were not disclosed.
• Waystar acquired HealthPay24, a financial engagement solution and patient payment platform based in Mechanicsburg, Pa. The financial details of the acquisition were not disclosed.

People:

• OMERS, a Toronto-based pension fund, hired Michael Hill as an executive vice president and global head of infrastructure. Hill previously worked at CPP Investments.