Hey Reader,

Altitude Edition 012 is hot off the press from Cirrus Capital Partners 📰

Quick note: This week's newsletter is late because, well, we have been swamped... 😅 Growing pains and thanks for hanging in there with us!

Now, without further ado...

The bird's eye 🦅 view of the most exciting news and insights around...

• Successful Companies and Founding Teams
• VC, PE, M&A, and Credit Transactions
• Growth Metrics, Benchmarks, Charts & Data
• New and Emergent Technologies
• Productivity Hacks

Created for founders, bootstrappers, VCs, angel investors, marketers, technologists, executives, and operators—everywhere.

Let’s get into it:

Are we toast?

New developments in AI have the average consumer asking: How cooked are we—charred or boiled?

Scarlett Johansson’s OpenAI clash is just the start of legal wrangles over artificial intelligence The movie “Her” was ahead of its time. OpenAI’s ChatGPT assistant allegedly mimicked Scarlett Johansson’s voice, though they claimed that the voice was another actress imitating Johansson. The incident underscores a broader concern about where the line is drawn with AI-generated content and people’s rights. It’s prompted calls for stronger legal protections, such as the No Fakes Act, to safeguard individuals’ likeness. If any industry faces increasing challenges as AI technology advances, its creative fields like design, literature, and performing arts. The legal system is only starting to catch up with these advances. It does make you think: if the likeness of celebrities is being exploited…how much protection is there for the average citizen? ​ Read article

Tech giants pledge AI safety commitments — including a ‘kill switch’ if they can’t mitigate risks I'm glad there's some mention of a "kill switch" in this AI talk; otherwise, I might believe we are, as many YouTube comments say, "so cooked, bro." At the Seoul AI Safety Summit, major tech companies, including Microsoft, Amazon, and OpenAI, pledged to ensure AI safety. They agreed to publish safety frameworks for their advanced AI models and set "red lines" for intolerable risks like automated cyberattacks and bioweapons. They also committed to implementing a "kill switch" to halt AI development if risks aren't mitigated. This is a landmark agreement that involves companies from multiple countries. This initiative should provide transparency and accountability in AI development and expand on previous commitments made in November 2022. ​ Read article

Trust me, you CAN hack it.

Why not asking for what you want, is holding you back Two things stand in a person's way: Fear and Pride. Kenneth Berger, an executive coach and former product manager at Slack, emphasizes the importance of asking for what you want to prevent burnout and achieve meaningful impact. His approach involves three steps: clearly articulating desires, asking intentionally, and accepting responses constructively. Embrace the discomfort and understand the significance of hearing "no." Anyone whose read Chris Voss' "Never Split the Difference", knows the "no", is an excellent source of insight. Berger also outlines techniques like the "dream behind the complaint" to uncover true desires. This strategy fosters integrity, genuine relationships, and effective leadership in the startup ecosystem. ​ Read article

Net Revenue Retention Trends, Trials, and Best Practices Net Revenue Retention (NRR) measures how much annual recurring revenue (ARR) is retained year-over-year from existing customers, including upsells, cross-sells, and churn. High NRR correlates with higher enterprise valuations. Trends show fluctuating NRR impacts on valuations, with recent decreases. So, to boost NRR, companies should improve customer onboarding, use product analytics, focus on ideal customer profiles, explore product extensions, review pricing strategies, and seek acquisition opportunities. If you want long-term growth and enterprise value, effective NRR management should be the focus of your business reporting. ​ Read article

​

Recent Transactions by Cirrus Capital Partners

Market Update

The higher SOFR rate indicates the cost of borrowing is increasing, which helps to temper economic activity and manage inflationary pressures. While the WSJ Prime rate is typically set at 3 percentage points above the Federal Reserve's federal funds target rate, the rising rate is a response to the Fed's rate hikes aimed at controlling inflation by slowing down spending and borrowing. The inflation rate is moderate and has slowed down compared to last month. The Fed's interest rate hikes aim to cool down this inflation by reducing demand and encouraging savings over spending. Key contributors to the current inflation rate include rising costs for shelter and gasoline. Shelter costs have been particularly influential, representing a significant portion of household expenses. Additionally, fluctuations in energy prices, particularly gasoline, have impacted the overall inflation rate​.

Employment: The unemployment rate sits at 3.9%, despite economists predicting it would remain unchanged at 3.80%. Non-farm payroll employment increased by 175,000 in April, slightly below the average monthly gain of 242,000 over the past 12 months. This suggests that while job growth continues, the pace has slowed compared to previous months​. The labor market remains tight, with consistent job gains across various sectors, particularly health care, social assistance, and retail trade. Despite the stability in unemployment rates, the challenge of finding qualified candidates persists, especially in the private sector. This ongoing tightness in the labor market suggests that businesses may continue to face difficulties in hiring, which could impact overall economic productivity.

Fiscal policy:

As of this month, the US government's proposed spending for fiscal year 2024 is around $4.19 trillion, with mandatory spending primarily coming from benefit programs like Medicare, Medicaid, and Social Security. The package includes $150 billion over ten years for access to quality and affordable healthcare, $79.1 billion for education, a $500 million decrease from 2023, but also includes flat funding for campus-based aid programs and increases for career and technical education and higher education programs. The budget also includes $60.4 billion in discretionary budget authority, a 1% decrease from 2023, and is intended to invest in climate resilience, cybersecurity, maritime security, and border management.

Private Capital Trickles Slowly Into 2024

​Pitchbook released a private market fundraising report...​

​

So far, in 2024, there is a marked decrease in private capital fundraising. However, larger funds (over $1 billion) dominated, comprising 81.2% of the total. Private equity led with 52.9% of the capital raised.

​

Why should a startup Founder care about this?

The steady distribution of capital across different fund sizes suggests a resilient market preference for larger funds, possibly due to their perceived stability and capacity to manage more significant investments.

In short, get your bag.

Where the money's flowing

Notable Equity Rounds from big to small

​$6 billion in xAI, via its Series B funding round. Key investors include Valor Equity Partners, Vy Capital, Andreessen Horowitz, and Sequoia Capital. The funds will be used to launch xAI’s products, build advanced infrastructure, and accelerate R&D. xAI, focused on developing advanced AI systems, has rapidly improved its model capabilities with releases like Grok-1.5. The company continues to expand and is hiring for various roles.

​$350 million from Google, to India's Flipkart, valuing the company at $37.6 billion. This investment strengthens Google's presence in India’s rapidly growing e-commerce market. Flipkart, already backed by Walmart, is one of India’s leading e-commerce platforms. The investment reflects Google's strategy to expand its digital footprint in India, a key growth market.

​$300 million raised for DeepL, the AI language translation startup, to focus on B2B growth. This funding round, led by IVP, Bessemer Venture Partners, and Atomico, will be used to expand DeepL’s product offerings and enhance its AI capabilities. The company aims to cater to business clients by providing advanced translation tools that integrate seamlessly into their workflows. DeepL’s technology is recognized for its high accuracy and efficiency, making it a strong competitor in the AI translation market.

Notable Credit Transactions from big to small

$60 million from Trinity Capital to Metabolon, an industry life sciences company, to expand R&D efforts to enhance its metabolomics platform and support global expansion and market penetration initiatives.

$35 million from Siena Lending Group for Charah Solutions, an environmental services company, to refinance debt and provide additional working capital to support growth.

$24.5 million from First Citizens Provides for the Texas Industrial Project, a construction financing facility. The funds will go to 121 Commerce Center, a large new industry property in Grapevine, TX.

Until our next flight,

Ryan, Sutheshna & your friends at Cirrus​

Thoughts on today's newsletter?

Loved it 😍: Tell us about it, forward along to a friend, or keep in touch with us on LinkedIn.

It was aight 🤷: Hey we're not for everyone. You can unsubscribe anytime here.

Hi, I just got here 👀: Pack your bags and subscribe to our future flights.

​