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UK founders race to sell, OpenAI’s risky move, and women in tech's VC crisis
Founders rush to exit before tax hikes, OpenAI’s Canvas tool could backfire, and women in tech face shrinking VC funding.
Wishu
October 08, 2024
It’s Tuesday!
The fight over automation is intensifying as unions like the longshoremen push to protect jobs from AI-driven tech. After securing a 61.5% raise, they're still negotiating for stronger automation protections. Similar battles are happening in industries like Hollywood, while non-unionized sectors face greater challenges adapting to automation without the same bargaining power.
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UK founders rush to sell startups before tax hikes
UK startup founders are racing to sell their companies ahead of the Autumn Budget, fearing potential hikes in capital gains taxes could lower future exit values.
Why it matters: The October 30 budget is expected to raise taxes on exits, particularly affecting Business Asset Disposal Relief, which currently offers lower tax rates for founders.
What they’re saying: Some founders are fast-tracking deals to secure current tax rates. “I’m petrified that the news isn’t going to be good,” said one fintech founder.
Big picture: Others are considering relocating abroad to maintain favorable tax conditions, with popular destinations like Dubai and Cyprus seeing increased interest.
With the budget looming, the UK tech community is bracing for potential changes that could reshape the startup landscape.
OPINION
OpenAI’s risky move to rival Anthropic
Its latest product could backfire by eating into its own business.
OpenAI just unveiled Canvas, a new ChatGPT interface that allows users to easily draft documents and code. While it may seem like a minor product update, it signals a bigger shift in OpenAI's strategy—and it might come with some serious risks.
Why it matters: Canvas is OpenAI's response to Anthropic’s Artifacts, an AI tool that lets users interact more smoothly with AI-generated content. Canvas introduces features like editing code snippets or making small adjustments to text, but it trails Anthropic in some areas, like generating sharable prototypes.
Zoom out: This shift toward more advanced user interfaces is a big departure from the standard chatbot model. But here's the catch: by focusing on consumer-facing tools like Canvas, OpenAI risks undercutting its own customers—startups that rely on OpenAI’s API to build similar products, like GitHub Copilot and Cursor.
The big picture: OpenAI’s biggest challenge may come from established players like Google and Microsoft, which already dominate the workplace tools space and are poised to add their own AI features. Competing in this market might require more than OpenAI is ready to deliver.
The bottom line: While Canvas looks like a smart play against Anthropic, it could end up cannibalizing OpenAI’s existing business and complicating partnerships—especially with developers already wary of competition from the AI giant.
Women in tech face a new crisis
VC funding is drying up, and AI is making things worse.
The fight for women in tech has hit a serious setback. Nonprofits like Girls in Tech are shutting down, and venture capital funding for female founders is plummeting. The progress made in the late 2010s seems to be unraveling, and the tech industry's old biases are resurfacing.
Why it matters: In 2024, startups with at least one female founder only received 18.6% of U.S. venture investment, down from 24.2% the year before. And layoffs? Women were disproportionately hit, making up 45% of the cuts despite filling less than a third of tech jobs.
Driving the news: Girls in Tech, once a pillar for women in Silicon Valley, folded earlier this year. Founder Adriana Gascoigne struggled as funding dried up, first with the pandemic and then as donors shifted focus to other causes. “We couldn’t keep the lights on,” she said.
Zoom out: The growing obsession with AI has led to a resurgence of the "tech bro" culture, sidelining diversity and inclusion efforts. Burnout is rampant, and women feel increasingly pushed out, not just from boardrooms but from the industry as a whole.
The bottom line: Despite evidence that diverse teams lead to better business outcomes, women in tech face an uphill battle as funding dries up and the industry backtracks on diversity. Without systemic change, the future of women in tech looks bleak.
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Updates ☕️
Venture capitalist Mark Farrell is gaining unexpected momentum in San Francisco’s mayoral race, but his business record is more complex than it seems.
Goldman Sachs has lowered the odds of a U.S. recession next year to 15% after a stronger-than-expected jobs report, signaling economic resilience despite prior concerns.
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Emma Watson invested in Hertility, boosting its funding to over $14 million to advance personalized women's reproductive healthcare.
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