October 24, 2022
Photo: Mandel Ngan/AFP via Getty Images
Hello and welcome to Protocol Enterprise! Today: The former head of the Committee on Foreign Investment in the U.S. under Obama says potential restrictions on investments with possible national security risks might not have much impact on U.S. investment in China AI or other emerging tech. Plus: AI content generation gets a financial boost.
The Biden administration appears to be determined to stall China’s mission to lead AI. However, possible restrictions on U.S. investments in China related to emerging tech that could have military applications might not have a major impact on venture capital flows between the two countries, the former head of the Committee on Foreign Investment in the United States under Obama, Aimen Mir, told me.
While it continues the trend toward creating a “less friendly” environment toward Chinese investors, a September executive order from President Biden directing the Committee on Foreign Investment in the United States to consider reviewing foreign investments with possible national security risks “is not likely to cause bilateral investment flows in VCs to dry up,” said Mir, partner at international law firm Freshfields.
The administration is keeping its foot on the gas when it comes to moving toward more concrete restrictions.
There’s also pending legislation that casts a very wide net.
This isn’t just about venture capital funding. Businesses investing in their own operations in China could be affected depending on how rules are written.
Valuations have become less hype-driven and more realistic; the amount of time spent on due diligence has increased substantially; and every founder needs to directly, clearly, and concisely answer the question, “Does this project have any real-world utility, and does it create economic value?”
Jasper raised $125 million for its AI content generation platform.
Prenuvo raised $70 million to use AI for early detection of cancer and other diseases.
Viome Life Sciences raised $67 million for its AI-based cancer detection software.
Banyan raised $43 million to help enterprises automate expense management.
RisingWave Labs raised $36 million for its data stream processing platform.— Aisha Counts (email | twitter)
Industrial software maker Aspen Technology announced that it has acquired real-time industrial information software provider Inmation Software.
Wells Fargo said it plans to incorporate Google Cloud AI in its Fargo virtual assistant.
Proposed Senate amendments to the 2023 National Defense Authorization Act include additional funding for emerging tech including AI.
The VC correction is proving once again that valuations are not an indicator of success. While money continues to flow, the crypto winter and VC slowdown have forced even the most committed Web3 venture capitalists (and their investors) to proceed with more caution.
Thanks for reading — see you tomorrow!