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The F42 brief #017
Here’s your Monday dose of The F42 Brief.
What’s inside »
📈 Trending Now
The one thing that’s making all the noise …. with a bit of fact checking.
💸 New Funds looking to give you cash
Who has launched a new fund to invest in startups last week.
💡Innovator Spotlight
Founders that are doing stuff differently.
🛠️ Tool of the Week
Something useful to up your startups velocity.
📌 Note to Self
Stuff I constantly remind myself about, don’t want make the same mistakes again.
📈 Trending Now
Buzz, Buzz, Buzzword... Let’s Talk About ‘Agents’
The word 'agent' is being thrown around everywhere in AI, but let’s be real—most of what’s labelled as an agent is just basic automation. These so-called agents are really just tools hooked up to APIs and LLMs like GPT. They follow instructions, operate within rigid frameworks, and have little actual understanding. Slapping the word 'agent' on them doesn’t make them intelligent—it just makes for good marketing.
True agentic AI is a different game altogether. Think of an AI agent acting like a sharp company rep—someone who doesn’t just forward your request but breaks it down, delegates it intelligently to specialists, and ensures it’s handled efficiently. Systems like OpenAI’s '01' hint at this, with deeper reasoning, chained prompts, and broader context windows. But even these are early steps. We’re nowhere near the interconnected, self-adaptive agents the term should imply.
The real breakthrough will be agents that don’t just act—they think, learn, and adapt. They’ll identify problems, call on other agents we didn’t even know existed, and build collaborative solutions dynamically. That’s the future. Until then, let’s not kid ourselves: most of today’s ‘agents’ are just shiny automations with a fancy name. The buzz is loud, but the substance? Still catching up.
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For the ❤️ of Startups
💸 New Funds Looking to Give You Cash
$20 Billion Across 18 New Funds
18 newly launched funds are targeting transformative industries such as AI, fintech, climate tech, and semiconductors, aiming to reshape the global startup ecosystem. Here's where the money is flowing:are you
🌍 Geography at a Glance
North America (45.85%): Dominates with significant investments in proptech, sustainability, and industrial sectors. Major funds include Mountaingate Capital Fund III, Fifth Wall REACT Fund, and Colbeck Strategic Lending III.
Global (33.02%): Focused on software, Web3, and blockchain technologies. Key players include Fund XIII by Insight Partners and Sigma Capital Fund I.
Europe (13.57%): Prioritises climate tech, defence, and the blue economy. Notable funds include the European Defence and Security Tech Fund and Algebris Climatech.
Rest of world: The remaining funds are distributed across Asia (5.14%), Africa (2.43%), and Australia (0.14%), targeting niches like semiconductors, deep tech, and sports tech, respectively. These regions highlight emerging opportunities in their respective ecosystems.
🎯 Sector Priorities
Software and Technology (60.64%): The largest share, driven by investments in enterprise software, cloud infrastructure, and fintech.
Web3 and Blockchain (9.91%): Focused on decentralised finance (DeFi), gaming, and metaverse projects.
Climate and Deep Tech (10.23%): Investments prioritising climate technology and materials innovation.
Summary of the Rest: Sectors like healthcare, biotech, blue economy, and industrial services collectively make up 19.22%, highlighting emerging and niche opportunities across various ecosystems.
🚀 Investment Stages
Pre-seed to Series A (66.67%): 12 funds focus on early-stage companies, targeting sectors such as semiconductors, biotech, and AI.
Series A and Beyond (33.33%): 6 funds emphasise scaling businesses in fintech, sustainability, and Web3.
Shanghai Zhiwei Private Equity Fund Management Co.,Ltd.
Shanghai Zhiwei is a newly announced venture capital investment fund with a registered capital of 10 million yuan. It is jointly established by China Micro Semiconductor (Shanghai) Co., Ltd., Liu Xiaoyu, and Jiaxing Furenheng Enterprise Management Partnership. The fund aims to strengthen upstream and downstream cooperation in the semiconductor industry, focusing on private equity fund management and investing in early to growth-stage companies within the industry.
Venturance Alternative Assets
Zentynel II: A venture capital fund focused on biotechnology and related businesses (e.g., medical devices). Target size: $30M.
Sigma Capital
Sigma Capital Fund I: A $100 million fund focused on investing in early-stage Web3 projects, including areas such as decentralized finance (DeFi), blockchain infrastructure, real-world asset tokenization, gaming, and the metaverse. The fund plans to invest in 100 early-stage projects, 25 liquid tokens, and make 10 fund-of-fund allocations over the next three years.
Sequence Ventures
Africa Deep Tech: A $50 million fund set to launch by 2026, focusing on early-stage deep-tech companies in sectors such as healthcare, education, agriculture, logistics, climate, AI, robotics, advanced materials, synthetic biology, future computing, and renewable energy across Africa.
Mountaingate Capital
Mountaingate Capital Fund III: A $570 million lower-middle-market private equity fund focusing on investments in digital, data, tech-driven marketing and business services, value-add specialty manufacturing, and distribution sectors.
Keen Venture Partners
European Defence and Security Tech Fund: A €125 million fund targeting 20-25 defense and security technology startups in Europe from seed to Series B stages. The fund focuses on dual-use technologies in European NATO countries.
K8 Capital
K8 Fund I, a hybrid private credit and venture capital fund seeking to raise at least $50 million for its debut fund. The fund focuses on private credit venture transactions of up to $5 million each in artificial intelligence and enterprise software startups.
Iceland Ocean Cluster
Blue Nova Ventures is a new venture fund aimed at bridging the financing gap for startups in the blue economy. The fund plans to raise between $30 million and $40 million to invest in startups focusing on seafood and ocean-related industries.
Intel Corporation
Intel Capital is a venture capital fund focused on early-stage startups in areas such as silicon, frontier technologies, devices, and cloud infrastructure. It manages over $5 billion in assets and has invested more than $20 billion across 1,800 companies.
Insight Partners
Fund XIII - Insight Partners' 13th flagship fund, raising a significant portion of the $12.5 billion total. This fund focuses on investing in high-growth software and technology companies across various stages, from seed to pre-IPO. With investments ranging from $5 million to over $500 million, Fund XIII aims to support transformative ideas in sectors such as enterprise software, cybersecurity, fintech, and healthcare technology. The fund's strategy involves not just capital injection but also leveraging Insight's extensive operational expertise to scale companies into global powerhouses.
Insight Partners
Opportunities Fund II - A structured equity fund that complements Fund XIII, designed to provide flexible financing solutions for software companies at any growth stage. This fund offers alternative funding options for companies seeking capital without significant ownership dilution. It aims to support businesses facing unique financial challenges or opportunities, such as accelerating growth, funding acquisitions, or restructuring balance sheets. Opportunities Fund II reflects Insight's commitment to adapting its investment approach to meet the diverse needs of the evolving software industry.
Good Springs Capital LP
Good Springs Capital Fund I: A $570 million inaugural fund focusing on control investments in middle-market companies in the industrial and services sectors. The fund is anchored by the Chickasaw Nation and includes a diverse group of investors.
Fifth Wall
Fifth Wall REACT Fund: A $500 million target fund focusing on proptech investments, particularly in areas of energy consumption and sustainability in the real estate sector, including data centers.
Colbeck Capital Management
Colbeck Strategic Lending III: A $700 million middle-market private credit fund focused on strategic lending for companies undergoing transitions. The fund aims to provide creative capital solutions and risk mitigation strategies.
AO Ventures
AO Ventures Fund: A US$30 million (approximately AU$48 million) venture capital fund established by Tennis Australia to invest in early-stage, high-growth technology-led startups in the sports, entertainment, media, and health industries. The fund aims to back approximately 20 startups, with investments ranging from $300,000 to $1.5 million, primarily at seed and Series A stages.
Michigan Strategic Fund
Michigan Innovation Fund: A $60 million program designed to provide critical funding to Michigan's existing early-stage evergreen venture funds, emerging evergreen funds, and the entrepreneur ecosystem. The fund aims to support over 500 Michigan-based startups, focusing on early-stage, high-growth companies in technology and innovation
Algebris Investments
Algebris Climatech: A new venture capital fund aimed at investing in climate tech and deep tech companies in key transition industries such as energy, materials, industrials, and food. The fund has reached a first close of €60 million, with a target of €100 million.
AC Ventures
ACV Capital V L.P. (ACV Fund V): A $210 million fund focused on early-stage, high-growth Indonesian startups and tech-enabled businesses in Southeast Asia. The fund targets sectors including fintech, e-commerce, health tech, MSME enablement, climate tech, and emerging consumer brands.
The data underscores a deliberate focus on early-stage innovation, reflecting an industry-wide recognition of the importance of nurturing foundational technologies. These investments are not just about capital but also strategic plays aimed at addressing emerging global challenges. The emphasis on diverse geographies highlights the interconnected nature of innovation, where breakthroughs in climate tech, AI, and fintech can influence ecosystems globally.
💡Innovator Spotlight 🙈🙉🙊
$TRUMP Meme Coin – Innovation or Just taking advantage?
Donald Trump’s launch of the $TRUMP meme coin, which rocketed to a $15B market cap in hours, raises a crucial question: Is this genuine innovation or just a cleverly disguised Ponzi scheme? Backed by Trump-linked entities holding 80% of the coin’s supply, it’s hard to ignore the risk that this could be another hype-driven crash waiting to happen.
Meme coins like $HAWK—launched by influencer Hailey Welch—show exactly what happens when the hype fades: a $490M market cap collapsing to $60M in 20 minutes, leaving many investors with significant losses. The question is, will $TRUMP be any different? With figures like Elon Musk and JD Vance backing the project, it’s clear that this isn’t just about a single coin—it's about pushing crypto into mainstream legitimacy.
As for the moral hazard of a sitting president launching a crypto token, that’s another conversation entirely. If you’re OK with it, then maybe Trump’s setting a new standard for acceptable behaviour in the crypto world. The takeaway for entrepreneurs and creators: hype sells, but be wary of where it leads. Whether $TRUMP becomes a crypto breakthrough or just another shit show, time will tell.
🛠️ Tools of the Week
If You Thought Google Would Lose Its Search Dominance, Think Again
Google isn’t just keeping up with AI—they’re leading the charge. From tools like Whisk for creative workflows to Vertex AI Search redefining e-commerce, they’re embedding AI across their entire ecosystem.
Projects like Astra and Mariner show they’re not just innovating—they’re dominating. AI isn’t a threat to Google; it’s their next big advantage. Betting against the 1-tonne gorilla? Risky move. out on their users tools
Here’s just a snapshot of Google’s AI rollout over the past month—it’s staggering:
Description: A generative AI tool that allows users to create images using other images as prompts, facilitating rapid visual ideation and creative experimentation.
Description: Integrates AI capabilities into Gmail, Docs, Sheets, and Meet, assisting in tasks like summarising emails, generating content, and enhancing meetings.
Description: An advanced AI-powered note-taking tool that helps users analyse and summarise research materials, aiding in effective information organisation.
Description: Enhances product discovery for retailers by embedding generative AI search features into digital storefronts, streamlining shopping experiences.
Description: A Progressive Web App version of Google AI Studio, accessible on desktop, iOS, and Android, enabling user-friendly AI model development and deployment.
Project Astra
Description: A universal AI assistant capable of interacting across text, images, video, and audio in real-time, offering seamless personal assistance.
Currently not publicly available as it’s still in testing.
Project Mariner
Description: AI agents that autonomously navigate and interact with web content, mimicking human browsing behaviours for enhanced web-based task handling.
Currently in a closed testing phase.
Generative AI Tools for Retailers
Description: Tools like GenAI Catalog and Content Enrichment to improve product data accuracy and create personalised shopping experiences for retailers.
Description: A multimodal AI model integrated into Vertex AI, offering advanced reasoning across text, images, audio, and video for enterprise applications.
Google Cloud: Scalable AI for Businesses Everywhere
Google Cloud is doubling down on enterprise AI, delivering solutions that scale effortlessly:
Pre-trained Models: Gemini 2.0-powered APIs for text, image, and multimodal tasks streamline AI integration.
Generative AI in BigQuery: Natural language interfaces make data querying and pipeline management faster and more intuitive.
AI for Industries: Sector-specific tools like the Automotive AI Agent, integrated with Vertex AI, are already powering Mercedes-Benz vehicles.
AI Infrastructure: Scalable hardware (TPUs and GPUs) supports custom model training and deployment.
Vertex AI Search: Simplifies enterprise data discovery, boosting efficiency and insights.
Google Cloud is proving why it’s the go-to platform for businesses embracing AI.
Not to be outdone, DeepMind, Google's AI research arm, has been making significant strides:
AlphaGeometry: An AI system capable of solving complex geometry problems at Olympiad levels.
Isomorphic Labs: A subsidiary focused on AI-driven drug discovery, leveraging advancements like AlphaFold 3.
World Modeling AI Team: A new initiative to build AI models that can simulate the physical world, advancing AGI development.
📌 Note to Self
Thank you for reading. If you liked it, share it with your friends, colleagues and everyone interested in the startup Investor ecosystem.
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Derek