Good day. In many ways, quantum computing is tailor-made for venture investors with a longer horizon: With commercialization still years away, most quantum startups these days have their heads down in the lab, with little exposure to the economic headwinds buffeting the outside world.

Pasqal, a four-year-old French quantum company, on Tuesday announced a €100 million ($108 million) Series B funding round, led by Temasek, with participation by the European Innovation Council fund, Wa’ed Ventures and Bpifrance, through its Large Venture fund, the startup said.

Based outside Paris, Pasqal will use the funding to accelerate development of its neutral atoms quantum-computing platform, promising commercial applications by 2024, said its Chief Executive Georges-Olivier Reymond. That includes a short-term goal to build a 1,000-qubit quantum computer—quantum’s exponentially faster version of standard computer bits, which replace binary ones and zeros with manipulated atoms.

How much faster? In 2020, a group of developers in China claimed their quantum system had performed a calculation in just 200 seconds that would take an ordinary computer 2.5 billion years to complete.

That kind of speed, combined with fast-developing artificial intelligence capabilities, is why big players, including Microsoft Corp.—through its backing of startup PsiQuantum —and International Business Machines Corp., are spending billions of dollars to make quantum happen.

Pasqal was spun out of Université Paris-Saclay in 2019 by a team of scientists, including Mr. Reymond, Christophe Jurczak and Alain Aspect—a French physicist who last year was awarded the Nobel Prize for Physics, alongside researchers John Clauser and Anton Zeilinger.

Both Microsoft and IBM are also racing to deliver a 1,000-qubit machine as soon as this year. So what is Pasqal’s pitch deck?

“We were able to demonstrate, for the first time, that a quantum computer can run a real-world industrial use case, with a real-world data set,” Mr. Reymond said. Pasqal’s competitive edge is to seize on business opportunities within the intermediate steps of the technology’s development, he said, “where current existing quantum computers can deliver something valuable for the market.”

And now on to the news...

Microsoft to deepen OpenAI partnership. Microsoft Corp. said Monday it is making a multiyear, multibillion-dollar investment in OpenAI, substantially bolstering its relationship with the startup behind the viral ChatGPT chatbot as the software giant looks to expand the use of artificial intelligence in its products, The Wall Street Journal reports.

• Microsoft said the latest partnership builds upon the company’s 2019 and 2021 investments in OpenAI.
   
• Though financial terms were not disclosed, Microsoft had been discussing investing as much as $10 billion in OpenAI, according to people familiar with the matter.

Venture firm Thrive Capital is selling a stake to a group of investors including Walt Disney Co. CEO Robert Iger and KKR & Co. co-founder Henry Kravis, a rare move designed to expand its investing reach and give the founders of the startups it backs access to some of the world’s most powerful business figures, WSJ reports.

• As a part of the transaction, Brazilian food magnate Jorge Paulo Lemann, French telecoms executive Xavier Niel, Indian oil tycoon Mukesh Ambani, Mr. Iger and Mr. Kravis will invest about $175 million to purchase a 3.3% stake in Thrive, the New York-based firm said Tuesday. The deal values the venture firm at $5.3 billion.

Elon Musk said he had funding to take Tesla Inc. private when he floated the idea in 2018, saying that financing from Saudi Arabia’s sovereign-wealth fund and his own stake in rocket-company SpaceX would have provided sufficient capital, WSJ reports. 

• “With the SpaceX stock alone, I felt funding was secured,” Mr. Musk said in a second day on the stand in a case brought by investors who say they lost money because of his tweets proposing to take the car company private.
   
• An attorney for the group of investors bringing the suit against Mr. Musk, Tesla and the company’s board at the time said Mr. Musk lied in saying he had secured funding to take Tesla private, causing investors to lose money.

Rivian Automotive Inc.’s chief lobbyist, Jim Chen, is departing the company, the latest high-level exit as the electric-vehicle startup works to scale up operations, WSJ reports.

• Mr. Chen, a former Tesla Inc. executive who joined Rivian in 2018, spearheaded the company’s state-by-state fight to allow direct-to-consumer sales, a core business strategy for EV-only makers such as Rivian and Tesla that don’t use traditional dealerships to sell cars.
   
• He is expected to leave Rivian at the end of February, the company said.

Funds

Highland Europe closed its fifth fund at €1 billion to continue investing in growth-stage software and consumer internet companies across Europe and the U.S. The firm also promoted David Blyghton to partner. With offices in London and Geneva, Highland Europe recently participated in funding rounds for ecommerce startup Oro, luxury vacation home provider Le Collectionist and plant-based food brand Huel.

People

Tenstorrent Inc., a startup creating artificial intelligence computers, appointed Keith Witek to the post of chief operating officer. He previously worked within Google's consumer electronics operation. Toronto-based Tenstorrent is backed by investors including Eclipse Ventures and Real Ventures.

Exits

Web3, media and entertainment brand Doodles agreed to acquire animation studio Golden Wolf for an undisclosed amount. In September, Doodles said it closed a $54 million first round of funding from Seven Seven Six, 10T Holdings, Acrew Capital and FTX Ventures.

Management consulting firm McKinsey & Co. purchased Iguazio, a data-science platform for real-time machine-learning applications. Terms weren’t disclosed. Iguazio is backed by investors including Pitango, Jerusalem Venture Partners, Verizon Ventures and Kensington Capital Partners.

Zift Solutions, a Cary, N.C.-based provider of partner relationship management and through-channel marketing automation software, picked up a $70 million investment. Investcorp Technology Partners led the funding, which included participation from Arrowroot Capital, Oxx, SSM Partners and AshGrove Capital.

Dayforward Inc., a New York-based digital life insurance startup, landed a $25 million investment and acquired Commercial Travelers Life Insurance Co. for an undisclosed amount. Led by AXA Venture Partners, the funding round included contributions from HSCM Ventures, Juxtapose and Munich Re Ventures.

Traction Complete, a Canada-based provider of revenue operations apps native to Salesforce, secured $5 million in growth financing led by Pender Ventures and Thomvest Ventures.

Share Creators, a Burlingame, Calif.-based startup that helps game developers, ecommerce marketers and product designers to collaborate online and manage digital files, snagged $5 million in Series A funding. 5Y Capital led the round, with Partner Levi Liu joining the company’s board.

Zurp, a fintech platform that offers exclusive experiences with cardholders' favorite influencers, raised $5 million in pre-seed funding. Investors included New Form, Launchpad Capital, OVO Fund, Darling Ventures and Animal Capital.

Grazzy, an Austin, Texas-based startup offering a digital tipping and feedback service for hospitality workers, was seeded with a $4.3 million investment from Next Coast Ventures and Tuesday Capital.

GoodOnes, a San Francisco-based photo organizing startup, raised $3.5 million in seed funding. Lead investor TLV Partners was joined by Liquid 2 Ventures and others in the round.

Julier Medical, a Paris-based developer of a device to treat patients with acute ischemic stroke, fetched €3 million (about $3.3 million) in seed funding from Sofinnova Partners.

• Spotify to cut 6% of its staff
   
• Arm-based chips make inroads with Apple, Amazon
   
• Small package-delivery companies grow as businesses seek alternatives to UPS, FedEx
   
• Salesforce faces more scrutiny as rough stretch tests business model
   
• Earth’s inner core may be reversing its rotation, study finds

• Retail investors are investing billions to disrupt the venture capital market, and it's working (Benzinga)
   
• The new venture capitalists: How community banks are fueling the growth of fintech (Forbes)

This newsletter was compiled by Angus Loten 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, Angus Loten,and Marc Vartabedian.

Follow us on Twitter: @wsjvc