You can now own your own piece of AI

Author

Alec Beard
June 04, 2024

Hey SaaS Sentinel Readers. Small investors are getting a shot at investing in high-profile AI companies, a major Google leak is causing controversy, and Iceland’s tech scene is booming. Here’s what’s happening in SaaS this week.

VCs are selling shares of hot AI companies to small investors in a wild SPV market

Image Credits: Bryce Durbin / TechCrunch

Got a spare million lying around? Turns out you too could own a piece of the hottest private AI startups, joining the ranks of VC heavyweights. How is this possible? Special purpose vehicles (SPVs) — essentially, SVPs are just syndicates that enable your average person to pool their investments into unicorn startups.

And the FOMO for investing in top AI startups has hit astronomical levels as a result. Now, VCs are scrambling to buy up shares through SPVs, then selling parts of their stakes to external backers like family offices and high net-worth individuals. We're talking companies like Anthropic, Groq, and xAI — the stuff VC dreams are made of.

The only caveat here is that, while the returns from these companies can be great, so can the risks. SPV terms are all over the place, with some charging up to 2% upfront and 20% carry. And you may get little transparency into the actual startups. Yet for FOMO-struck investors scared of missing the AI gold rush, due diligence often takes a back seat.

Case in point: Anthropic. After FTX crashed, billions worth of Anthropic shares flooded the market. Hungry brokers swiftly created SPVs to feed the investing masses.

Meanwhile, xAI's $6B mega-round stayed open for weeks to allow a range of SPVs to form. The longer the round stayed open, the more slices that smaller investors could gobble up. But understanding what you actually own? Good luck.

For those willing to stomach the risks, SPVs offer unmatched access to the upper echelon of one of tech's hottest sectors. Just don't say we didn't warn you when that unicorn turns out to be a flop.

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A massive leak of Google Search documents sparks fury across the SEO industry

Image Credits: Getty Images

Grab the popcorn, folks. Some of Google's most confidential search secrets just got exposed in a massive leak of 2,500 internal documents. Seems the endless speculation over the sly search giant's ranking factors was warranted after all.

For decades Google has guarded its search algorithm like the nuclear codes. Employees who so much as whisper about its inner workings risk facing severe penalties. Yet somehow this key intel slipped out from a few ex-Googlers for all the world to see, setting the SEO industry ablaze.

Turns out that the theories about Google weighting clicks, site authority, and Chrome data appear to be true — despite their past claims otherwise. Whoops? Guess we weren't as "misinformed" as Google assured. No wonder the company's feeling smugly vindicated right now.

But perhaps most shocking is this leak comes as Google barrels towards an AI-driven search future. As those goofy chatbot summaries proved recently, Google still has lots to learn about surfacing quality content. There’s a possibility this leaked intel will factor heavily into future SEO experiments and studies to crack the new code.

What you need to know about Iceland’s startup scene

Image Credits: Harald Nachtmann / Getty Images

While Iceland boasts epic natural wonders, its budding startup ecosystem is pioneering wonders of a different sort — we're talking wound dressings made of fish skin. Leave it to Icelanders to find inspiration in the most unlikely places.

Yet the creativity driving this fledgling tech scene reaches beyond national pride to global ambitions. Companies like medical startup Kerecis and gaming standout Porcelain Fortress have already sparked overseas interest. Having outgrown their small but robust local network of accelerators and investors, they're now poised for international expansion.

And Iceland's startups have some powerful friends abroad. The country's unique assets recently landed it innovation grants from the EU's Horizon Fund and a partnership with NATO. Some of the startups from Iceland that have forayed abroad include Nasdaq-listed eye care company Oculis; Prescriby, an opioid addiction prevention company that recently raised €2 million to expand in Canada and enter the U.S.; Sidekick Health, whose digital care platform has gained traction across Europe and the U.S.; and Avo, which became the first Icelandic startup to join Y Combinator in 2019.

Turns out Iceland's strategic location makes it a choice intersection for Arctic development. So while chilly Iceland may seem an unlikely startup hub compared to sizzling Silicon Valley, you can expect more ingenious ventures to emerge from its glacial shores. The country's only just scratching the surface of what its natural resources and creative capital have to offer.

Parting Thoughts

Well, that’s the tech news for this week. Hit reply and let us know — did you learn something from today’s newsletter?

Until next time!