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Question of the Week: Has Crypto Cleaned Up Its Act?

By Marc Vartabedian, WSJ Pro

 

Good day. Venture funding for crypto startups has streaked skyward this year as regulations have relaxed under a crypto-converted president and the initials SBF seem a distant memory. Could the current boom cycle lead to the kinds of fraud or abuse that previously plagued the crypto sector, or are things different now? Please email responses to vcnews@wsj.com.

Last week, we asked to hear about outlooks on the beleaguered biotech sector: Is the glass half empty or half full? Here are responses, edited for clarity and length.

  • Justin Stevens, founder and CEO of Overlap Holdings: “Rarely are the hype cycle and opportunity set within a sector as out of sync as biotech is today. The combination of machine learning and automated high-throughput lab screening are creating compelling therapeutic candidates at speeds never before imagined. We feel that we’re on the precipice of a paradigm shift: Those who sit on the sidelines will regret missing out.”
     
  • Antoine Papiernik, chairman and managing partner of Sofinnova Partners: “What’s exciting in biotech is that the glass does not need to be half full to taste fabulous! Think about an old Armagnac. The fabulous thing about biotech is that when it works, patients get the benefit, but investors, too. Think Abivax, a French company that was flying under the radar and was patiently recruiting a large Phase III for its drug to treat ulcerative colitis, a debilitating condition. The Phase III data was stellar, and so was the stock price appreciation.”
     
  • Justin Butler, a partner at Eclipse Ventures: “The glass is, and must be, half full—in fact, it’s overflowing. Healthcare and life sciences are the most critical needs for our society. As the saying goes, a healthy person has many problems, a sick person has just one. Advances in compute, robotics, AI and other interdisciplinary capabilities will enable the biotech, life sciences and healthcare sectors to extend not just life span, but health span. Extraordinary economic returns will result from the giant leaps in medicine we are about to witness.”
  • Jim Tananbaum, the CEO of Foresite Capital: “The glass is definitely half full. Biotech continues to drive the vast majority of new drugs coming to market. We believe the sector has been oversold due to a combination of high interest rates and uncertainty around the new administration. We expect to see steady increases in biotech valuations over the next year.”

And now on to the news ...

 
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Top News

President Trump has said banks denied him accounts after his first term. PHOTO: WIN MCNAMEE/GETTY IMAGES

Changes to VC. President Trump signed a pair of executive orders Thursday intended to reshape the world of banking and high finance—some in ways Wall Street likes, and others it feared.

  • One order seeks to make it easier for everyday Americans to invest their retirement savings in assets that lie outside public markets, such as private equity, cryptocurrency and private real estate.
     
  • The move fulfills a long-sought goal of Wall Street hedge funds and private-equity firms, which for years have wanted to tap in to the giant pool of money in 401(k) and other defined-contribution plans.
$60.35

The closing price of Firefly Aerospace after making its debut Thursday on the Nasdaq. That was up from the initial public offering price of $45.

OpenAI Unveils GPT-5, Its Most Powerful Model, After a Two-Year Wait

OpenAI on Thursday announced the release of GPT-5, its most advanced AI model, a culmination of more than two years of development that saw a series of setbacks and delays. Interacting with the new technology “really feels like talking to an expert in any topic, like a Ph.D.-level expert,” Chief Executive Sam Altman said on a call with reporters Wednesday. He emphasized its ability to allow anyone to create software applications by typing in simple, English-language prompts—a process commonly referred to as “vibe coding.” In a pre-scripted demo, an OpenAI researcher asked ChatGPT to create a web application that could teach his partner French through interactive games and flashcards. The chatbot did so within minutes, writing more than 300 lines of code.

Read the full article here. 

Executive Order Is Good News for VC, Carta Policy Head Says

The new White House order that seeks to expand access to private assets for 401(k) investors is a welcome development for the venture market, said Anthony Cimino, head of policy for Carta. “As private markets grow, this leaves too many Americans out of this economic journey, wealth appreciation, and diversification. Unlocking appropriate access not only benefits them, but drives more capital into this ecosystem,” he said. Carta, which provides cap-table management and other software and services for private markets, will benefit as well should this market expand, he said. The executive order also calls on the Securities and Exchange Commission to consider revisions to accredited investor rules, he noted. “This would help funds raise more capital from more investors, particularly outside of traditional networks,” Cimino said.                                                                                                                                                           —Yuliya Chernova

 
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Industry News

People

Sustainable fertilizer developer Switch Bioworks appointed Steve del Cardayre as chief technology officer and Brett Boghigian as chief business officer. Del Cardayre was most recently CTO of Zero Acre Farms. Boghigian was previously senior vice president at Mori.

Identity, device and access management platform JumpCloud appointed Sumesh Rahavendra as chief business officer. He was most recently group chief digital and transformation officer at Pos Malaysia.

Exits

10x Genomics agreed to acquire single-cell analysis startup Scale Biosciences in a cash-and-stock deal worth $30 million, according to Dow Jones Newswires.

 

New Money

Strand Therapeutics, a Boston-headquartered developer of mRNA-based therapeutics, scored $153 million in Series B funding. Kinnevik led the round, with Investment manager Ala Alenazi joining the company’s board.

Decart, a San Francisco-based real-time video generation startup, completed a $100 million funding round at a $3.1 billion valuation from investors including Sequoia Capital, Benchmark, Zeev Ventures and Aleph.

Stavtar Solutions, a New York-based provider of business spend management and expense allocation SaaS for alternative asset managers, picked up a $55 million Series A investment. Elephant provided the funding, with Partner Peter Fallon joining the company’s board.

Lorikeet, a Sydney-based provider of a fully autonomous alternative to chatbots for customer support, collected $35 million in Series A funding led by QED Investors.

Kustomer, a Short Hills, N.J.-based AI-powered customer service platform, raised $30 million in Series B funding. Norwest led the investment, which included participation from Battery Ventures, Redpoint Ventures and Boldstart Ventures. Scott Beechuk, a partner at Norwest, will join Kustomer’s board.

August Health, a San Francisco-based electronic health-record platform for senior living operators, secured $29 million in Series B financing. Base10 Partners led the round, which included contributions from General Catalyst and Matrix Partners.

Casap, a startup providing intelligent automation for dispute and fraud operations, raised $25 million in Series A funding. Emergence led the investment, which included additional support from Lightspeed Venture Partners, Primary Venture Partners and others.

Orbital Operations, a Long Beach, Calif.-based startup developing high-thrust orbital vehicles for national security missions, was seeded with an $8.8 million investment led by Initialized Capital.

 

Tech News

The Vision Funds business booked a profit of ¥451.39 billion, compared with a ¥204.30 billion loss a year earlier. PHOTO: KAZUHIRO NOGI/AGENCE FRANCE-PRESSE/GETTY IMAGES

  • SoftBank Group posts quarterly profit as AI bet pays off
     
  • Anthropic’s quiet edge in the AI talent war
     
  • Intel’s CEO, under attack from Trump, is already at odds with his board
     
  • EU says chip exports to U.S. will have 15% tariff ceiling despite new levies
     
  • Five things to know about the Intel CEO’s links to China
 
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Around the Web

  • High costs and thin margins threatening AI coding startups (TechCrunch)
     
  • Meta acquires AI audio startup WaveForms (The Information)
 

The WSJ Pro VC Team

This newsletter was compiled by Marc Vartabedian and Zachary Cole.

WSJ Pro Venture Capital is a premium service of The Wall Street Journal. We cover venture capital and the global startup ecosystem. Share your tips, comments and questions: vcnews@wsj.com

The Team: Matthew Strozier, Yuliya Chernova, Brian Gormley and Marc Vartabedian.

Follow us on X: @wsjvc

 
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