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The F42 brief #019
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
AI Infrastructure is Going to Zero
The foundational AI model layer is rapidly commoditizing, and the value is shifting up the stack to specialized applications, fine-tuning, and proprietary data.
This follows the same trajectory we’ve seen in other industries:
🔹 Cloud computing – AWS didn’t make money selling servers. It built a trillion-dollar business on managed services, AI integration, and data platforms.
🔹 Search engines – Indexing became a commodity. The real money was in ads, AI, and personalized search.
🔹 Telecom – Laying fiber and maintaining towers is a loss leader. Revenue comes from services, enterprise solutions, and data bundling.
🔹 Banking – Payments and transactions have near-zero margins. The real profit is in credit, lending, and financial services.
Now, AI is following the same playbook:
🔹 The tracks (infrastructure) are going to zero.
🔹 The trains (applications and services) are where the money is.
Companies relying purely on foundational model access (API fees, compute costs, etc.) are about to get squeezed. The ones that make it really big will own the application layer, fine-tuning, or highly specialized and verticalized AI solutions with massive user benefits.
The next AI giants won’t be the ones with the biggest models—they’ll be the ones that build the smartest, most useful, and deeply integrated AI solutions. We are seeing this already as Vertical SaaS gets replaced with Service as Software and giant LLMs, that produce generalist consensus blah will struggle to sell their underwhelming benefits versus highly sophisticated solution providers.
This is exactly what we’ve been saying on AI for Startups—its not so much the model, thats just a tool, it always comes down to the user benefits. Monetization is shifting fast, and anyone building on AI needs to think beyond model access.
🚀 Where do you see this playing out? Who wins, and who gets left behind?
If you have not joined the Fusion42 Community on Telegram — A space for Founders, Framers, and Funders who show up to get **it done,
it is probably time to do so.
For the ❤️ of Startups
💸 New Funds Looking to Give You Cash
🚀 $12.6 Billion Across 13 New Funds
A fresh wave of venture capital funds is injecting $12.6 billion into 13 investment vehicles, targeting blockchain technology, life sciences, deep tech, and sustainability. These funds are reshaping the global startup ecosystem by fueling high-growth industries and market-defining innovations.
🌍 Geography at a Glance
North America (74.2%) – Major push into life sciences and deep tech, led by Blackstone Life Sciences ($5B) and 8VC Fund VI ($998M).
Asia (14.4%) – Strong backing for blockchain and tech startups, including SIDBI’s $1.15B Fund of Funds for Startups (India).
Europe (2.4%) – Focus on sustainability and quantum computing, with Sustainable Ventures' SEIS & EIS Impact Funds and Quantonation II (€200M).
Rest of the World (9%) – Covering Middle East, Africa, and Latin America, with notable investments in agrifoodtech, robotics, and healthcare, including Peregrine Ventures ($600M), Lever VC ($50M), and Chang Robotics Fund ($50M).
🎯 Sector Priorities
Blockchain Technology (31% of funds) – Supporting startups on Solana & Sei blockchain with funds like SOL Global Ventures and Sei Foundation's Sapien Capital ($65M).
Life Sciences (27% of funds) – Biopharma and healthcare innovation dominate, led by Blackstone Life Sciences ($5B) and Peregrine Ventures ($600M AUM, new fund incoming).
Deep Tech (19% of funds) – Quantum computing, AI, and robotics see strong interest with Quantonation II (€200M) and lev8.vc ($30M).
Sustainable Ventures (15% of funds) – Impact-driven startups gain traction, highlighted by Sustainable Ventures’ SEIS & EIS Impact Funds.
Other Sectors (8% of funds) – Covering agrifoodtech, advanced manufacturing, and industrial AI, with funds like Lever VC ($50M) and Chang Robotics Fund ($50M).
🚀 Investment Stages
Early Stage (62% of funds) – Backing pre-seed to Series A startups, particularly in blockchain, deep tech, and sustainability.
Growth Stage (38% of funds) – Scaling established players, especially in life sciences and sustainability.
What This Means for Founders
The data reveals a clear trend toward concentrated funding in AI and advanced technologies, with North America taking the lead in life sciences investments, startups in deep tech, sustainability, and blockchain should align their fundraising strategy to capitalize on these new funding opportunities. Early-stage founders in blockchain and AI, and growth-stage startups in life sciences, stand to benefit the most.
SOL Global Investments Corp.
SOL Global Ventures is a new venture capital arm focused on investing in early-stage companies being built on the Solana blockchain platform. The fund's first investment is a US$1 million to US$1.5 million commitment to Stay Inc., a short-term rental technology platform.
Sei Foundation
Sapien Capital – Open Science Fund I: A $65 million venture fund investing in DeSci startups building on the Sei blockchain, with check sizes ranging from $100,000 to $2 million. The fund aims to deploy its capital over the next 3-4 years, focusing on areas such as gamified drug discovery, wearables, and user-owned data collectives.
Small Industries Development Bank of India (SIDBI)
Fund of Funds for Startups (FFS): A new Rs 10,000 crore ($1.15 billion) fund with expanded scope to support startups through investments in SEBI-registered Alternative Investment Funds (AIFs). The fund aims to boost tech innovation and potentially support deep tech startups.
Sustainable Ventures
Sustainable Ventures SEIS Impact Fund: Invests in SEIS qualifying investments that have the potential to address strategic sustainability objectives while targeting top-class returns for investors.
Sustainable Ventures
Sustainable Ventures EIS Impact Fund: Invests in EIS qualifying investments that have the potential to address strategic sustainability objectives while targeting top-class
Quantonation Ventures
Quantonation II is an early-stage venture capital fund investing globally in novel technologies based on advances in quantum physics and computing. The fund targets €200 million by mid-2025 and focuses on transformative quantum technologies across various applications, including quantum computing, materials science, and deep physics.
Peregrine Ventures
Peregrine Ventures is an Israeli venture capital firm managing $600 million in assets, focusing on healthcare and life sciences investments. They are considering launching a new early-stage fund later in 2025.
Lever VCFund II:
A $50 million venture capital fund focused on early-stage investments in agrifoodtech startups. The fund targets novel ingredients, sustainable food and agtech, digitization/software in agriculture, and emerging food brands emphasizing health and sustainability.
lev8.vc
$30 million deep tech fund focused on early-stage investments in sectors such as AI, medtech, robotics, and advanced manufacturing. The fund aims to support 20-30 high-potential deep tech startups.
Chang Robotics
The Chang Robotics Fund: A $50 million seed-stage venture capital fund specializing in disruptive technologies. It targets early-stage innovators in smart manufacturing, robotics, industrial AI, and energy transformation, aiming to address industry challenges such as labor shortages, energy efficiency, and environmental remediation.
Blackstone
Blackstone Life Sciences is raising a new life sciences fund targeting at least $5 billion, with $1.6 billion already secured. The fund will focus on supporting biopharma companies, including emerging players, established companies, and late-stage product financings.
CERES INC.
Apollo Capital No.2 Investment Limited Liability Partnership - A fund targeting investments in startups focused on internet marketing and blockchain technology. The fund is set to be established on February 1, 2025, with an initial investment of ¥1,000 million and a maximum total investment amount of ¥4,000 million.
8VC8VC
Fund VI, a $998 million venture capital fund targeting investments in tech, life sciences, and other sectors. This ambitious fund aims to support early to growth-stage companies across multiple industries, including biotech, digital health, defense tech, and other innovative startup sectors. Building on 8VC's track record of investing in successful companies like Asana, Flexport, and The Boring Company, Fund VI represents a significant increase from their previous $880 million flagship vehicle. Led by Palantir co-founder Joe Lonsdale, 8VC continues to expand its influence in the venture capital landscape from its new base in Austin, Texas.
💡Innovator Spotlight
The Future is Quantum
Quantum computing isn’t just another tech trend—it’s a fundamental shift in how we solve problems. Unlike traditional computers that process data in 0s and 1s, quantum computers use qubits, which can exist in multiple states at once. This means they can crunch through complex calculations at speeds that make today’s supercomputers look like pocket calculators.
So, what startups are leading the charge?
🔹 1. PsiQuantum
Founded in 2016, PsiQuantum is developing a general-purpose silicon photonic quantum computer. The company aims to build the world's first utility-scale, fault-tolerant quantum computer, with plans to have the system operational by the end of 2027.
🔹 2. Multiverse Computing
Established in 2019, Multiverse Computing specializes in quantum computing software solutions for sectors such as energy, logistics, manufacturing, and finance. Their platform, Singularity, enables users without prior quantum computing knowledge to leverage quantum algorithms through familiar tools like Microsoft Excel.
🔹 3. QuEra Computing
Based in Boston, QuEra Computing is developing advanced neutral-atom-based quantum computers. Founded in 2018, the company focuses on building scalable quantum computers to tackle complex problems across various applications.
🔹 4. Rigetti Computing
Founded in 2013, Rigetti Computing is developing a full-stack quantum computing solution based on superconducting qubits. The company designs and fabricates quantum chips, integrates them with a controlling architecture, and develops software for programmers to build algorithms for the chips.
🔹 5. IonQ
IonQ is pioneering trapped-ion technology for quantum computing, which offers greater stability and accuracy compared to traditional silicon-based qubits. This approach positions them as a strong contender in the race to build scalable quantum computers.
These startups exemplify the diverse approaches and rapid advancements in the quantum computing landscape, each contributing uniquely to the future of this transformative technology.
🚀 What’s Next?
2025 is shaping up to be a big year. We’re expecting major strides in logical qubits (making quantum computers more reliable), Quantum Machine Learning (impacting areas like medicine and climate science), and hybrid quantum-classical systems (blending quantum power with traditional computing for real-world applications).
It’s still early days, but one thing’s clear—quantum computing isn’t science fiction anymore. The question is, who’ll be the first to crack the code?
🛠️ Tools of the Week
Choosing the Best Prompt Framework for AI: Which One Works Best?
Getting great results from AI isn’t about luck—it’s about giving the right instructions. A poorly structured prompt will leave you with vague, off-target responses. The right framework, however, turns AI into a highly effective assistant.
There are several prompt engineering frameworks designed to structure AI interactions, but which one is best? Here’s a breakdown of the top contenders: COMPASS, RACE, SPEAR, and CLEAR—and when to use each.
1. COMPASS: Best for Content Creation & Brand Voice
COMPASS is designed to craft prompts that result in high-quality, brand-aligned content. If you need blog posts, social media copy, or marketing material, this is the framework for you.
🔹 How It Works:
Context – Background information for the AI
Objective – The purpose of the content
Mode – The AI’s voice or persona
People – Target audience
Attitude – The desired emotional tone
Style – Writing style and format
Specifications – Any specific requirements (e.g., word limit, keywords)
🔹 Best For: Marketing teams, brand storytelling, and AI-assisted content creation. 🔹 Weaknesses: Not ideal for problem-solving or iterative refinement.
Example: ❌ “Write a post about our new water bottle.”
✅ “Create an engaging Instagram post about AquaRevive, our new water bottle made from recycled ocean plastics. Keep it under 280 characters, use an upbeat tone, and include #EcoFriendly.”
2. RACE: Best for Structured & Precise AI Responses
RACE is a direct and to-the-point framework, ideal when you need AI to generate clear, structured outputs quickly.
🔹 How It Works:
Role – The AI’s persona (e.g., expert, analyst, teacher)
Action – The specific task
Context – Background information
Expectation – The desired outcome or format
🔹 Best For: Generating reports, structured articles, and technical analysis. 🔹 Weaknesses: Less flexible for creative writing.
Example:
❌ “Explain AI ethics.”
✅ “As a technology journalist, write a 500-word article explaining AI ethics, including real-world examples and challenges in regulation.”
3. SPEAR: Best for Conversational AI & Refining Responses
SPEAR is all about iterating and refining AI responses. If you need back-and-forth interaction or adjustments over multiple turns, this is your go-to framework.
🔹 How It Works:
Start – Initiate with a clear instruction
Provide – Offer necessary details and context
Explain – Clarify any complex aspects
Ask – Pose specific follow-up questions
Rinse & Repeat – Iterate and refine the response
🔹 Best For: Chatbots, interactive content, customer support automation. 🔹 Weaknesses: Requires user engagement to refine responses.
Example:
❌ “Give me startup advice.”
✅ “What are the top three things a first-time founder should prioritise? Also, highlight common mistakes.”
4. CLEAR: Best for Business Problem-Solving & Strategy
CLEAR is perfect for structured problem-solving, making it a strong choice for business insights, consulting, and strategic analysis.
🔹 How It Works:
Challenge – Define the problem
Limitation – Identify constraints
Effect – Explain the impact
Action – Specify the required steps
Result – Describe the expected outcome
🔹 Best For: SWOT analysis, strategic planning, and decision-making. 🔹 Weaknesses: Not designed for creative or conversational prompts.
Example:
❌ “How can we increase app engagement?”
✅ “Analyze the declining user engagement on our mobile app, using data from the past six months. Assess its impact on retention and suggest three UI/UX improvements.”
Which Framework Should You Use?
AI Prompting Tools to Streamline Your Work
Beyond frameworks, there are powerful tools designed to help with prompt generation and optimization:
Taskade: An AI prompt generator with a built-in prompt library for various content types and workflows.
PromptPerfect: A tool specializing in refining prompts for different AI models like GPT-4, ChatGPT, and Midjourney.
Junia AI: An adaptable prompt generator designed to enhance prompt quality for various uses, including ChatGPT, DALL-E, and MidJourney.
PromptLayer: A platform for streamlined prompt engineering, offering features like a Visual Prompt Builder and GPT Index integration.
Promptmetheus: An intuitive platform with tools for creating, testing, and optimizing prompts for LLM applications.
Final Thoughts
No single framework is “best” across all use cases. If you’re writing content, go with COMPASS. Need structured analysis? Use RACE. Want to refine AI responses? Try SPEAR. Solving a business problem? CLEAR is your best bet.
By choosing the right framework and leveraging prompt optimization tools, you can get better, faster, and more relevant results from AI—and stop wasting time on vague, unstructured prompts.
Which framework and tool do you think fits your needs best? 🚀
📌 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.
If you've got suggestions, an article, research, your tech stack, or a job listing you want featured, just let me know! I'm keen to include it in the upcoming edition.
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For the ❤️ of startups
✌🏼 & 💙
Derek
Thanks Derek. Very insightful and a great read to start my week, although the days seem to clump together, as do weeks. Onward! 😎