TWiST500 Spotlight: The must-know startups from AI to robotics! | E2024

Alex Wilhelm kicks off the show (0s)

• This episode is packed with takeaways and insights for investors, founders, and enthusiasts, covering the TWiST 500 list of top 500 private market companies, essentially the top 1% of venture-backed startups out of around 50,000 (0s).
• The TWiST 500 list aims to identify companies that will have the greatest financial impact, become enormously successful, and make lots of money for their founders, employees, and backers (1m36s).
• The list is not just a collection of favorite companies, but rather a data-driven approach to determine which startups will crush the private and public markets (1m40s).
• The episode will cover various categories, including AI, robotics, fintech, cybersecurity, and more, highlighting innovation in the market today (2m6s).
• The TWiST 500 categories with the most companies include AI (45 companies), robotics (19 companies), fintech (12 companies), cybersecurity (7 companies), and crypto (5 companies) (2m26s).
• There is some overlap between AI and robotics due to the use of LLMs in modern humanoid robots (2m41s).
• The numbers and ratios of companies in each category will change as the next 400 companies are added to the list (3m1s).
• The episode will also feature a special note from Jason Calacanis at the end (2m13s).

AI for Devs: Qodo & Poolside (3m8s)

• The AI for devs category is a significant market, focusing on developers, a large and expensive labor class that has historically been in short supply, making it a good place to apply AI technology to help them work more efficiently and faster (3m8s).
• Qodo, formerly known as Codium AI, is a company that stands out in this category, founded in 2022 and backed by prominent investors such as Soua Ventures, Square Peg Capital, and Vine Ventures, with a valuation of around $50 million (3m38s).
• Qodo offers a SaaS business model, charging $19 per user per month for its regular team package, and its product helps write code, test, and integrate the code, taking coding to the next level (3m58s).
• The company's product category is already monetized, with GitHub's developer co-pilot reaching a $100 million ARR mark and accounting for 40% of GitHub's growth (4m15s).
• Poolside is another startup in the AI for devs category, founded in 2023 and having raised over $600 million in capital from investors such as Redo, Ficus, and Bane Capital Adventures (4m56s).
• Poolside has a strong pedigree on the founder side, with one of its founders, Jason Warner, being a former CTO at GitHub, and the company is building its own models, offering AI fine-tuning, and using its technology on customers' own stacks (5m26s).
• Poolside's massive series B funding of $500 million is not only for operating capital but also suggests that the company might be looking to make acquisitions, roll up smaller players, and get good talent and customers (5m57s).
• The AI for devs category is expected to go through some consolidation, and Poolside's significant funding puts it in a strong position to be a key player in this space (6m15s).

AI Infrastructure: CoreWeave (6m25s)

• There's a new category of companies called "neoclouds" that focus on providing specialized cloud services, particularly for AI training, often using lots of GPUs or other AI-related chipsets, and CoreWeave is one such company that embodies this approach (6m25s).
• CoreWeave was founded in 2017 and has raised a significant amount of capital, with at least $1 billion in equity and around $10 billion in debt, totaling around $12-13 billion, making it an incredibly well-funded company (7m7s).
• The company is building a GPU cloud, which requires a lot of capital to purchase GPUs, racks, cables, switches, and load balancers, and to build data centers (7m28s).
• CoreWeave is not alone in the neocloud space, with other companies like Landa Labs and Crusoe also operating in this area, according to Simi analysis (7m43s).
• The company is growing quickly, with a recent valuation of $23 billion, and has received backing from major companies like Cisco, which could provide benefits beyond just funding, such as access to networking hardware (8m1s).
• CoreWeave has also received backing from Magnetar Capital, which has put together a new AI fund tied to CoreWeave's offerings, providing the company with access to the next generation of AI startups (8m21s).
• Overall, CoreWeave has a huge market, tons of capital, cool corporate backing, and ties to a venture capital group, making it a notable company in the neocloud space (8m40s).

OpenPhone - Get 20% off your first six months (8m43s)

• OpenPhone is a service that simplifies business communications by providing a single phone number that works across all devices, including existing phones and desktops, using a single elegant app (9m1s).
• The service is useful for businesses as it allows employees to keep their personal phone numbers private, and instead use a shared business phone number for customer interactions (9m21s).
• OpenPhone is also beneficial for customer support, events, and VIP interactions, as it allows for shared phone numbers and field phone numbers (9m35s).
• The service is affordable, priced at $13 a month, and TWiST listeners can get an extra 20% off their first six months (9m48s).
• OpenPhone allows users to port their existing phone numbers over at no extra cost, and offers a free trial with a 20% discount for TWiST listeners (9m55s).
• For more information, users can visit OpenPhone.com/TWiST to start their free trial and take advantage of the 20% discount (10m0s).

Data for AI: Tollbit & Scale (10m15s)

• Tollbit is a startup that acts as an aggregator between individual content owners and AI model companies, allowing content owners to opt into a larger pool and earn money for their content, rather than having it scraped away from them (10m32s).
• The company was founded in 2023, has raised $7 million to date, and has a model that is seen as fantastic, with potential for a more equitable value exchange to ensure a rich field of data for future AI models (10m32s).
• Another company, Human Native, is also doing a similar thing, and both companies are seen as ones to watch (11m19s).
• The data provided by content owners is crucial for building AI models that are aware of recent news and analysis, and Tollbit's model helps to create a circular flow of value between content owners and AI model companies (11m25s).
• Scale AI is a late-stage company that has raised $1.6 billion to date, with a recent $1 billion Series F round led by Excel, and has a valuation of $13.8 billion (12m30s).
• The company has experienced fast revenue growth, generating $400 million in revenue in the first half of the year, up from the same period in 2023, and has expanded its services to include data labeling, data curation, and pre-built apps for enterprise companies (12m51s).
• Scale AI's work is seen as important for enterprise adoption of AI, and the company is expected to make a splash when it goes public (13m46s).

Robotics: Figure & Dusty Robotics (14m5s)

• Robotics companies are building robots with gears and sensors, and some are working on general-purpose humanoid robotics that can perform various tasks, incorporating AI to some degree (14m5s).
• Figure is a company working on humanoid robotics for general applications, having raised around $854 million from backers including Parkway Venture Capital, Intel Capital, and Microsoft (14m50s).
• Figure's technology appears to be advancing quickly, with its second-generation robot, Figure O2, announced in August and already tested inside a BMW factory, showing potential for industrial applications (15m31s).
• Dusty Robotics is a company that has created a small wheel robot that marks out plans on job sites, having raised $69 million from Baseline Ventures and other investors (16m16s).
• Dusty's robots have experience helping set up data centers and factories, and the company has landed a seven-figure contract, indicating its potential for growth in the industrial world (17m8s).
• Both Figure and Dusty Robotics are companies to watch in the robotics space, with Figure focusing on general-purpose humanoid robots and Dusty Robotics focusing on specific application nonhumanoid robots (17m46s).

NetSuite - Download the CFO's Guide to AI and Machine Learning for free (17m51s)

• The future of business is uncertain, with varying opinions from experts, but one way to prepare is to "future-proof" a business with NetSuite by Oracle, which has been used by over 40,000 businesses. (17m52s)
• NetSuite is the number one cloud ERP, bringing together accounting, financial management, inventory, and HR into one seamless platform, providing one source of truth. (18m9s)
• With NetSuite, businesses have visibility and control to make quick decisions with real-time insights and forecasting, allowing them to make data-driven decisions. (18m22s)
• NetSuite enables businesses to close their books in days, not weeks, and spend less time looking backwards, allowing them to focus on what's next. (18m33s)
• A free guide, "The CFO's Guide to AI and Machine Learning," is available for download at netsuite.com/twist, providing valuable information on AI and machine learning. (18m46s)

Fintech: Circle & Altruist (19m8s)

• Circle is a fintech company behind the USDC stable coin, which has seen significant growth and is now a killer crypto use case, providing people with access to dollars digitally in their home markets, (19m25s).
• Circle has raised over $1 billion and is looking to go public through a traditional IPO, (19m38s).
• The company's USD-backed reserves are now more lucrative due to the higher interest rate environment, (20m25s).
• Circle is a standout in the fintech sector, with plans to expand into Euro stable coins, (20m38s).
• Altruist is another notable fintech company, founded in 2008, which has raised around $450 million from investors such as Insight Partners and Vrock, (20m50s).
• Altruist builds software tools for registered investment advisers (RIAs) and has seen significant growth, with a 550% increase in 2023 and a tripling of its assets under management (AUM) for two consecutive years, (21m15s).
• Altruist's growth is attributed to its support for RIAs that want to go independent and take better care of their clients, (21m36s).
• The company is expected to go public, which is a significant event in the current market, as it will provide liquidity to venture capitalists and allow for capital recycling, (21m57s).

Cybersecurity: Huntress & Wiz (22m37s)

• Huntress is a cybersecurity company that provides services to small and medium-sized businesses (SMBs), and has seen significant growth, with 70% revenue growth in each of the last two years, crossing the $100 million ARR threshold, making it IPO-scale, (23m7s).
• The company has raised $310 million from investors such as Blue Venture, Point Capital, Sapphire Ventures, and Kleiner Perkins, and its strong revenue growth and public market multiples make it an attractive company for exit via acquisition or IPO, (23m24s).
• Huntress has cracked the SMB market, which is known for high churn rates, and has reached real scale, making it a great business and potentially leading to better cybersecurity for SMBs, (24m31s).
• Wiz is a cloud security company that has grown quickly in terms of capital raised and revenue, with $2 billion raised from investors such as Salesforce Ventures, Green Oaks, Insight, Lightspeed, and Thrive, (25m10s).
• Wiz has one of the fastest revenue growth histories, reaching $100 million in ARR in August 2022, $350 million by the end of 2023, and $500 million in the middle of this year, taking only 18 months to reach the first $100 million in ARR, (25m37s).
• Wiz was poached by Google with a $23 billion acquisition offer, but turned it down, opting to go public instead, with plans to hit $1 billion in ARR first, (26m1s).
• Wiz has disclosed financial numbers and has shown insane product-market fit, making it a company that is likely to do well when it goes public, (26m10s).

Crypto: Farcaster (26m30s)

• Farcaster is a crypto-based social network that has been included on the TWiST 500 list due to its potential for a significant outcome (26m31s).
• The company has raised a total of $180 million, with $30 million initially raised and an additional $150 million in a massive round led by Paradigm, making it a unicorn (26m54s).
• Farcaster is one of the few crypto companies on the TWiST 500 list, with its social network built on the blockchain showing promise as a non-financial use case for crypto (27m25s).
• The platform has nearly 700,000 total users and 60-70,000 daily active users, which is not huge but still significant given the large ecosystem built around crypto (27m32s).
• Investors believe in Farcaster's potential, which is why it has raised substantial funds, and it could create significant value over time if it takes off (27m53s).
• Farcaster is considered a speculative bet on the TWiST 500 list, but it is still a company to watch and see how it develops (28m7s).

Other Standouts: Harvey AI, Kojo & Albedo Space (28m17s)

• Harvey AI is a standout startup that uses AI in the legal space, particularly in writing and ingesting documents, and has reached $10 million in annual recurring revenue (ARR) as of last December (28m32s).
• The company has gained significant attention from investors and is expected to experience rapid growth this year (28m55s).
• Kojo is another notable startup in the construction tech space, and its work is worth exploring (28m59s).
• Albedo Space is a company that aims to provide high-resolution images of the planet through satellites in low orbit, offering its services on a subscription basis (29m4s).
• The space economy is expected to be a significant area of growth, with companies like Radiant Aerospace working on making it cheaper and faster to launch objects into orbit (29m17s).
• The TWiST500 list still needs 400 more names and is constantly being updated with new companies every week (29m34s).
• The list can be found on TWiST500.com, and readers can also suggest names or email alexw@launch.co for more information (28m22s).

Sprig - Visit to book a demo and get a $75 gift card. (30m4s)

• The goal in the startup game is to achieve product-market fit, which involves increasing conversions and boosting engagement by understanding users, something that cannot be achieved solely through analytics (30m7s).
• Sprig is a product experience platform that uses AI to generate opportunities for continuous product improvement at scale (30m22s).
• Sprig captures product experiences in real-time using heat maps, replays, surveys, and feedback studies to provide insights into user behavior (30m32s).
• The platform's industry-leading AI analyzes product experience data to generate real-time insights and provide actionable product recommendations (30m46s).
• These recommendations enable companies to drive revenue, increase retention, and improve user satisfaction with their products (30m55s).
• Top product teams at companies like Figma and Notion are already using Sprig's AI to unlock new opportunities at scale (31m2s).
• To learn more about Sprig, visit sprig.com/twist to book a demo and receive a $75 gift card (31m11s).

Angel University kicks off November 6th (31m17s)

• Angel University is a workshop held every six months, where attendees can learn how to become professional angel investors, with the next course scheduled for November 6th, taught by the host and Mike Savino, a partner at Launch (31m17s).
• The workshop is based on the host's book and their experience investing in over 400 startups, including successful companies like Uber and Robin Hood (31m37s).
• The course covers the fundamentals of angel investing, the host's personal philosophy, and how to source and decide which companies to invest in, including a 13-point criteria for investing and 30 "red flags" to avoid (32m2s).
• The workshop also covers adding value as an investor, portfolio construction, and securing pro-rata, as well as the importance of understanding the power law and the Pareto principle (32m35s).
• The workshop is open to all investors, whether retail or accredited, and all proceeds go to charity, with over 1,200 individuals attending last year's workshops (32m54s).
• The host's Angel Investing Syndicate, syndicate.com, allows accredited investors to see the deal flow and invest in startups (33m5s).
• The workshop's proceeds are donated to charity, with a full list of donations available at angel.university/charity, and registration is available at angel.university (33m15s).
• The host plans to move the workshop to twice a year due to their busy schedule, so attendees should clear their schedules for the November 6th course (33m33s).
• Angel investing is an attractive career path for professionals who want to learn and make a difference, as it offers a unique opportunity to support startups and entrepreneurs who are changing the world (34m28s).
• Having real-world experience in angel investing can be beneficial when applying for a venture capitalist position, as it demonstrates initiative and a track record of making informed investment decisions (34m45s).
• Many people who are retired or have a significant amount of wealth often become angel investors as a way to have fun and be involved with entrepreneurs who are passionate about changing the world (35m3s).
• Angel investing offers a flexible schedule, allowing individuals to choose how much time they want to dedicate to it, and provides the opportunity to meet interesting people and be a part of innovative startups (35m21s).
• The pursuit of angel investing is exciting and rewarding, offering non-financial benefits such as seeing the direction of the world, meeting inspiring people, and being part of plans to change the world (35m46s).
• Angel investing can be a fun and fulfilling hobby or career, and it is encouraged for those who are interested in supporting startups and entrepreneurs (36m0s).