Hi everyone, itâs Priya in San Francisco. Startup funding is off to a slow start in the US. But first...Three things you need to know today: [View in browser](
[Bloomberg](
Hi everyone, itâs Priya in San Francisco. Startup funding is off to a slow start in the US. But first... Three things you need to know today: ⢠Intel reported a $7 billion loss [in its foundry unit in 2023](
⢠Elon Muskâs X hired a new head of safety [to oversee content policies](
⢠Amazon ends its cashierless [purchasing system for grocery stores]( Haves and have-nots Silicon Valley may be buzzing about artificial intelligence, but venture capital dealmaking is still suppressed. In the US, venture capitalists poured $36.6 billion into startups in the first quarter of this year, according to data from research firm PitchBook. That funding went to 2,882 companies. On both measures, thatâs a nearly 30% decrease compared with the same period in 2023. The takeaway? [Startups had their worst funding year since 2019 last year](, and this year is starting off even worse. Startups have been plagued by big-picture economic concerns, a sleeping IPO market and a rising tide of cost-consciousness, compounded by venture capitalistsâ own funding slowdown. Plus, âsticky inflation has pushed hope of interest rate cuts to the back half of the year, and recession remains a possibility,â Pitchbook analysts said. While some buzzy AI startups are feasting on megarounds â Cohere, for example, is in talks [to raise $500 million or more at a valuation of $5 billion]( â itâs still something of a famine for the rest of the industry. âAI is its own bubble,â [Jason Stoffer](bbg://people/profile/16676916), an investor at the venture capital firm Maveron, told me. âItâs its own part of the market.â Founders outside of AI, who were able to collect checks at higher valuations before interest rates went up, have cut costs and are reluctant to attempt to raise more money because it will still come with a [significant valuation haircut](, Stoffer said. On top of that, while Reddit and Astera Labs soared after their initial public offerings, [the number of IPOs expected for this year]( is still slim. âYou can count them on two hands,â Stoffer said. Indeed, the Pitchbook data show global venture capital exit activity in the first quarter of this year was the lowest in any given period since the final quarter of 2016. Limited partners who send their cash to venture firms want to see distributions before they put up more capital commitments, Stoffer said. The venture funding figures are a bit less bleak globally, where the first quarter of this year matched the same period a year ago. But that $96 billion went to nearly 37% fewer companies. Itâs a sign that thereâs a tale of two types of startups right now. The most promising ones that are focused on AI are raking in cash. The rest are fighting for scraps. â[Priya Anand](mailto:panand20@bloomberg.net) The big story Microsoft was criticized by a government cyber review board [over a Chinese-state attack last year of the companyâs software]( that allowed access to the emails of US officials. The hack ânever should have occurred,â the review board said in its report, faulting Microsoft for failing to pay attention to security weaknesses in its products. One to watch
[Watch Erika Klauer of PGIM Jennison Technology Fund discuss the opportunities in artificial intelligence on Bloomberg Television.]( Get fully charged Disney CEO Bob Iger is poised to defeat an activist effort to gain board seats [in a costly proxy battle](. President Joe Biden and Chinese leader Xi Jinping discussed US efforts to [force the sale of popular video site TikTok](. Jon Stewart said Apple told him not to interview Federal Trade Commission Chair Lina Khan [while he was host of a streaming series on Apple TV+](. More from Bloomberg Bloomberg Technology Summit: Led by Bloomberg Businessweek Editor Brad Stone and Bloomberg TV Host and Executive Producer Emily Chang, this full-day experience in downtown San Francisco on May 9 will bring together leading CEOs, tech visionaries and industry icons to focus on what's next in artificial intelligence, the chip wars, antitrust outcomes and life after the smartphone. [Learn more](. Get Bloomberg Tech weeklies in your inbox: - [Cyber Bulletin]( for coverage of the shadow world of hackers and cyber-espionage
- [Game On]( for reporting on the video game business
- [Power On]( for Apple scoops, consumer tech news and more
- [Screentime]( for a front-row seat to the collision of Hollywood and Silicon Valley
- [Soundbite]( for reporting on podcasting, the music industry and audio trends
- [Q&AI]( for answers to all your questions about AI Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Tech Daily newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox.
[Unsubscribe](
[Bloomberg.com](
[Contact Us]( Bloomberg L.P.
731 Lexington Avenue,
New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](