06.24: Can't Take My AIs Off You

My favourite early-stage deals from July 2024:

• Tomato, an AI accent softener and noise cancellation tool for foreign call centres, closed a $2.1m extension on seed funding (FM). There’s certainly a substantial market for this product – the call centre outsourcing market is roughly ~$90bn – and the ROI per company is intriguing. Although the noise cancellation would likely improve the overall effectiveness of the interactions, I’m not sure where I stand ethically about softening foreign accents. 
• Unify, a tool to find the best LLM for every prompt, raised $8m funding from investors including Y Combinator (TC). In the era of buzz surrounding AI, I and many others remain skeptical of the troop of new companies using the tag without actually providing any value. I think Unify could be a good tool for developers and possibly broader use. 
• Wordsmith, an AI-powered legal assistant for legal teams, raised a $5m seed round led by Index Ventures and joined by General Catalyst, Yellow VC and others (FM). I think this could be a pretty solid enterprise software one day especially if they potentially include an LLM feature which could be integrated into their daily stack; organisations are increasingly adopting this. As with most AI products, there are concerns regarding factor substitution, but I suspect Wordsmith would enable and not displace paralegals. 
• Day is an AI-powered self-learning CRM. The company is announcing a $4 million seed round led by Sequoia Capital (TC). Pretty based move for two ex-HubSpot employees to build a CRM that could one day replace theirs. I haven’t had the chance to use the product (yet) but I’m strongly betting on them. Initial testimonials suggest that Day is certainly one to watch.
• Inscope, a provider of AI powered accounting tools, raised a $4.3m seed round led by Lightspeed Venture Partners (TC). The common theme across the products selected this month is the depiction of tangible value and a reasonable expectation for traction to evolve over time as a result. I may never get to use Inscope and Wordsmith, but the market, founder expertise alongside its use cases give me enough to reasonably bet on their success (without actually seeing the materials to which the actual investors would have had access).
• Whoosh, an operating system for golf and racquet clubs, raised a $10.3m Series A with the backing of operators and industry professionals such as Alison Lee and Andy Roddick (Forbes). This may just be evidence of the value Whoosh's current solutions create for customers and the power of its strategic vision. Whoosh includes a cloud-based reservation system, communication channels with members and streamlining workflows for operations staff. Ticks all my boxes in terms of what to look out for. With over 70,000 racquet clubs globally, this could potentially be huge.
• Roamless, an affordable travel eSIM provider, raised $5m seed funding led by Shorooq Partners (FM). Reminds me a lot of Bland AI – “why didn’t we have this sooner?” – and a no-brainer in my opinion. I anticipate even more competition, but I believe in the product either way given it operates in >150 countries with a fair pricing model. I just might give this a go on my next trip to Lagos.
• Tender, a food technology startup developing plant-based alternative meat, raised $11M in Series A funding led by Rhapsody Venture Partners (TC). Definitely an interesting story behind the company and a promising, but tricky market. I hope they succeed: if they can hack a pathway to scaling, I would be happily proven wrong. 
• Function, a health provider enabling patients to manage lifelong health, has raised a $53m Series A led by a16z and including solo investors such as Kevin Hart, Matt Damon and Zac Efron (PRN). Function is the first company to provide access to 100+ lab tests at a single cost of $499 per year – equivalent to $42 per month or $1.37 per day. The American private healthcare system is infamously known for its high costs; Function is trying to make health monitoring affordable and easy with 100+ lab tests completely insurance-free. Function is still in its beta – as is the case for many healthtech startups even post-Seed – but this could be something very interesting. 
• A24, the indie film studio behind box-office successes including “Everything Everywhere All At Once” and “Midsommar”, raised $100m led by Josh Kushner’s Thrive Capital at a $3.5bn valuation (FT). I’m aware this is not an early-stage raise, but felt including as it’s unheard of for non-technology companies to raise from a VC fund – and that amount of money at that. Then again, indie studios aren’t exactly known for doing things the conventional way. 

Bulls

• Speak is an AI-powered language coach which encourages learning by talking. I think it’s a great product which is performing quite well and a much-needed and long-overdue challenger to Duolingo.
• Sword Health is an AI-powered virtual physical therapist for musculoskeletal (MSK) conditions. Pretty promising in my opinion and stands apart from its predecessors which probably lacked the motion tracking and pose estimation elements. 
• Twelve Labs is a multimodal AI that understands videos like humans. Interesting product with tons of use cases…may just out-ball Spiideo. Twelve Labs is what I think Watchful AI could have been.

Bears

• Carv is an AI recruitment tool customised to each organisation. They seem late to the AI powered recruitment/HR/future of work space and I don’t think the product is necessarily outstanding compared to its alternatives. Time will tell. 
• Butterflies enables people to build deep relationships with AI friends via a social media platform. No words other than “why?”