🌴 LA Firms Weigh In on California's Groundbreaking VC Diversity Law

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Good Morning Los Angeles,

We want to acknowledge that it has been a long difficult week for many and we hope that everyone is taking care of themselves.

🔦 Spotlight

California Governor Gavin Newsom signed Senate Bill 54, the first U.S. law targeting diversity in venture capital. Starting March 1, 2025, VC firms operating in the state must annually report founder diversity. 📝🌍🤝

Los Angeles skyline at sunset.

Image Source: Cedric Letsch

The law pertains to the following venture capital firms:

  • Headquartered in CA
  • With operations in CA
  • That have invested in companies that operate or are based in CA
  • That have received investments from residents of CA

They are required to annually report demographic data of the founders they support, including race, disability status, and sexual orientation. This information will be aggregated and made public, fostering transparency and accountability within the industry. The bill has been met with enthusiasm from tech policy advocates, who hope it will lead to increased funding for startups led by women, Black, and Latinx founders, addressing historical disparities in venture capital allocation.

In Los Angeles, pioneering firms such as M13 and Slauson & Co. are at the forefront of embracing the groundbreaking Senate Bill 54. Anna Barber, a Partner at M13 and Chair of the Pledge LA Advisory Committee, is dedicated to expanding access to capital for underrepresented founders and fund managers. M13, in fact, voluntarily tracks the diversity of their portfolio founders, understanding the pivotal role that data and accountability play in this pursuit. For Pledge LA, Senate Bill 54 represents a potential milestone towards achieving heightened transparency and uniform diversity across portfolios in California's venture ecosystem.

Slauson & Co.’s venture capital approach has been rooted in transparency and inclusivity from the very beginning based on a deep-seated belief in the untapped potential within historically underrepresented communities. They emphasize that transparency around inclusivity, far from being limiting, has exceeded expectations and has led to founders from diverse backgrounds approaching them with innovative ideas and businesses. Find out more about Slauson & Co.’s journey of transparency and diversity here.

Some organizations have expressed initial concerns about the law and potential unintended consequences and even Governor Newsom acknowledged the need to refine the bill's language for effective implementation and plans to address any problematic provisions in the 2024-2025 Governor's Budget. Moving forward, advocates aim to push for similar legislation in other states and countries, with the ultimate goal of fostering greater inclusivity and equity in venture capital investments. 👥💸📈

🎉 Don’t forget about our referral contest this month! 🎉

The contest is simple: whoever refers the most friends to dot.LA using our referral program by October 31st will get a coffee and conversation with Zillow, Pacaso, and dot.LA co-founder Spencer Rascoff, where you can pitch him, get business advice, or just shoot the breeze. This is a great opportunity for any current or future entrepreneur, so good luck referring! ☕️☕️☕️

P.S. If you’re not based in LA, you can hop on a Zoom instead 💻

🤝 Venture Deals

LA Startups

  • Machina Labs, a manufacturing robotics startup, raised a $32M Series B co-led by NVentures, NVIDIA’s venture capital arm, and Innovation Endeavors. - learn more
  • Commons Clinic, a startup that provides in-person and virtual orthopedic care to patients, raised a $19.5M Series A led by RA Capital Management, with participation from Time BioVentures and previous investors Floating Point and Courtside Ventures. - learn more
  • SuperOps.ai, a startup that creates cloud-native tools for managed service providers, raised a $12.4M Series B round co-led by Addition and March Capital, with participation from Matrix Partners. - learn more
  • Kino Studios, a startup that provides filmmakers with tools to create, engage, and monetize their target audience before distribution, raised a $2M+ Pre-Seed Round from Sequoia Capital's scout program, Slow Ventures, Metaweb Ventures, Genius Ventures, The Near Protocol, and Blockchain Founders Fund. -learn more
  • Sotai, a startup that aims to streamline the modeling of AI and machine learning applications, resulting in models that are easy to train, constrain, and comprehend, raised a $2M Seed Round led by Four Rivers. -learn more
  • Auriga Space, a startup developing ground-breaking electromagnetic technology for responsive, lower-cost, and sustainable space launches raised a $5M Funding Round led by Tucks Ventures with participation from Unlock Venture Partners. -learn more
  • Proteus Space, a satellite design and manufacturing startup, raised a $4.2M Seed Round led by Moonshots Capital with participation from Lavrock Ventures, The Veteran Fund, Mana Ventures, AIN Ventures, Capital Factory and Industrious Ventures. -learn more

LA Funds

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Featured Event (11/9)

RECURRING REVENUE CONFERENCE on November 9th in Culver City

Southern California's premier SaaS and Subscription conference, this one-day event draws 600+ top founders, executives, investors, and Cloud experts. Experience a dynamic program with 20+ sessions, including keynotes, fireside chats, breakout sessions, and roundtable discussions. This year's insights span AI, metrics that matter, scaling strategies, making a pivot, and more. Keynotes include ChowNow and HackerOne CEOs. Attendees will enjoy plenty of networking time during breakfast, lunch, coffee cart breaks, and cocktails on the patio. Join us on November 9th at the Culver City Hilton to learn from industry leaders in the SaaS and subscription ecosystem.

Learn more and register using code DOTLA229 for a discounted ticket rate of $229. Register here.

If you're an early-stage founder, apply here for a $59 ticket.


📅 LA Tech Calendar

Monday, October 16th

  • Sharehouse E-commerce Dinner - Apply to join this invite only event which is bringing together top e-commerce founders and leaders. Join ShareHouse for a vibrant evening of networking and incredible food!

Tuesday, October 17th

Wednesday, October 18th

  • Global Growth Open Mic Night - Join Grow Big for a riveting afternoon event in Marina Del Rey where top brands and industry leaders take the stage, one after the other, to spill the beans on their electrifying journeys to digital global success.
  • Entrepreneur's Dinner - Santa Monica - Entrepreneur dinner to get together, share ideas and support one another. Entrepreneurs of all levels are welcome. Most attendees are full time business owners. New business owners and people running a businesses on the side are also welcome.
  • South Bay Tech & Aerospace Happy Hour - Join Startup Coil and Starburst’s tech and aerospace happy hour in El Segundo on Wednesday evening.

Thursday, October 19th

Thursday, October 26th

  • Expert DOJO Fall 2023 Cohort Demo Day! - Join Expert Dojo’s fall demo day to learn about the investment opportunities in their 10 newest investments! Sectors vary from artificial intelligence to gaming!

🌍 Around The Internet

Los Angeles Secures 4th Spot in PitchBook’s Global VC Ecosystem Rankings

Los Angeles' prominent position is due to its high development score, which takes into account factors such as deal value, deal count, exit value, exit count, fund value, and fund count from Q3 2017 to Q2 2023. Notably, Los Angeles lags behind the other leading VC developed ecosystems (San Francisco, New York, Beijing, and Shanghai) in terms of fund count. The average number of funds in the other ecosystems exceeds that of LA by over 200%. Despite this substantial difference in funds, both deal count and exit counts for these top VC developed ecosystems were only moderately higher than those in LA, with averages of 30% and 24% respectively shining light on the the substantial startup scene in Los Angeles. Find the full report here.

Source: Pitchbook as of June 30, 2023

📙 What We’re Reading

  • Waymo starts free robotaxi tour in LA neighborhoods. - read more
  • Discover how the streaming landscape is evolving as Los Angeles-based services face rising subscription costs, shedding light on the industry's shift towards on-demand content and its impact on consumers' wallets in an era of economic uncertainty. - read more

Subscribe to our newsletter to catch every headline.

🏰 Disney's Epic Investment Stands Out Amidst Gaming Industry Layoffs

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

🔦 Spotlight

In the midst of widespread gaming industry layoffs, a glimmer of positive news emerges as Disney announces a significant move: a $1.5 billion investment in Epic Games. 🏰💰🐭

Image Source: Disney

Disney's $1.5 billion investment in Epic Games, disclosed late Wednesday, signals a strategic alignment aimed at expanding the success of "Fortnite." The deal enhances Epic's growth prospects after financial setbacks, including layoffs, and strengthens the partnership between the two companies. With Disney gaining a larger equity stake in Epic, the collaboration will broaden the integration of beloved Disney franchises like Marvel, Star Wars, Pixar, and Avatar into the game, potentially boosting its appeal and longevity. This significant investment underscores Disney's commitment to interactive entertainment and signifies a shift towards games as a primary revenue stream, aligning with the growing trend of digital engagement among younger demographics. Moreover, the potential for crossover sales of physical Disney products within "Fortnite" and the exploration of new content distribution channels are just some of the opportunities arising from this partnership.

For LA tech, the Disney-Epic Games partnership represents a validation of the region's burgeoning tech and gaming ecosystem. The substantial investment in Epic, who maintains a large Los Angeles office with 1,000+ employees (according to LinkedIn), reflects confidence in the LA’s talent pool and innovation potential. Additionally, this partnership between two industry giants fosters an environment for further collaboration, investment, and growth within LA's tech sector. As Disney and Epic Games deepen their ties and explore new avenues for content integration and distribution, it not only elevates the prominence of LA as a tech hub but also stimulates economic growth and job creation in the region. This partnership highlights LA's unique position as a hub where technology and entertainment converge. With its ability to integrate diverse industries, LA is driving innovation and expansion in digital entertainment. 🚀💸🎮

🤝 Venture Deals

LA Companies

  • ProducePay, a financing and marketplace platform for the fresh produce market, raised a $38M Series D led by Syngenta Group Ventures joined by Commonfund, Highgate Private Equity, G2 Venture Partners, Anterra Capital, Astanor Ventures, Endeavor8, Avenue Venture Opportunities, Avenue Sustainable Solutions, and Red Bear Angels. - learn more
  • Blush, an invite-only dating app that drives users to local businesses on dates, raised a $7M Seed Round from individuals like Naval Ravikant. - learn more
  • Mogul, a startup founded last year that provides an overview of an artist's royalty earnings and identifies areas where money is owed but has not yet been collected, raised a $1.9 million seed round from Wonder Ventures, United Talent Agency, AmplifyLA, and Creator Partners. - learn more
  • Avnos, a hybrid direct air capture startup, raised a $36M Series A led by NextEra Energy and joined by Safran Corporate Ventures, Shell Ventures, Envisioning Partners, and Rusheen Capital Management. - learn more
  • AI.fashion, startup whose mission is to help retailers enhance the online shopping experience by providing consumers with virtual try-ons and personalized fashion recommendations, raised a $3.6M Seed Round led by Neo. - learn more
  • Suma Wealth, startup that aims to demystify financial topics and provide culturally relevant content, virtual experiences, and resources to help Latino users navigate financial challenges and opportunities, raised a $2.2M Seed Round . Radicle Impact led, and was joined by Vamos Ventures, OVO fund and the American Heart Association Impact Fund. - learn more
  • 222, a startup that helps users discover their city and meet new people through unique social experiences, raised a $2.5M Seed Round. Investors included 1517 Fund, General Catalyst, Best Nights VC, Scrum Ventures, and Upfront Ventures. - learn more
  • LimaCharlie, a security operations cloud platform, raised a $10.2M Series A led by Sands Capital. - learn more
  • Polycam, an app that uses a smartphone’s sensors to capture 3D scans of objects, raised an $18M Series A co-led by Left Lane Capital and Adjacent, and joined by Adobe Ventures and individuals like Chad Hurley and Shaun Maguire. -learn more.

LA Venture Funds

Actively Raising

  • ReelCall, Inc., an entertainment technology company focused on powerful apps and platforms that help build and maintain the professional network of connections vital to career growth, is raising a $850K Pre-Seed Round. - learn more
  • CZero, a startup building software to decarbonize logistics for logistics businesses and goods business through a vetted marketplace and optimization software. - learn more
  • Couri, a technology startup addressing last-mile delivery issues, is raising a $450K Pre-Seed Round at a $2.2M post money valuation. - learn more
  • Sweetie, a marketplace to help people plan date nights, is raising a $1.5M Pre Seed Round. - learn more
  • StartupStarter, an investment platform that provides real-time data and analytics on startups, is raising an $850K Angel Round. - learn more

If you’re a founder raising money in Los Angeles, give us a shout, and we’d love to include you in the newsletter!

Venture Waves, Climate Tech Wins, and Silicon Beach's Ongoing Evolution

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Anduril Seeks $1.5B in VC Funds

Defense company Anduril Industries Inc., based in Costa Mesa and founded by Palmer Luckey, is seeking to raise $1.5 billion in fresh funds to boost its valuation to $12.5 billion or more, according to sources quoted by The Information. This fundraising effort, if successful, would mark one of the largest venture capital rounds of the year.

Image Source: Anduril

Anduril recently secured a contract to develop and test small unmanned fighter jet prototypes under the Air Force’s Collaborative Combat Aircraft (CCA) program, beating out major defense companies like Boeing, Lockheed Martin, and Northrop Grumman. Alongside General Atomics, Anduril will design, manufacture, and test these aircraft, with a final multibillion-dollar production decision expected in fiscal year 2026. This program aims to deliver at least 1,000 combat aircraft to fly in concert with manned platforms and is part of the Air Force’s Next Generation Air Dominance initiative. Central to Anduril’s success in this contract is the Fury autonomous air vehicle, acquired through the purchase of Blue Force Technologies. This victory underscores Anduril's rapid advancement in the defense sector, aligning with Luckey's vision of building faster and more cost-effective defense assets. - learn more

Los Angeles Ranks Number 1 in Emerging Climate Tech Hub

The 2024 Emerging Climate Tech Hubs Report by Revolution highlights Los Angeles as a burgeoning center for climate tech innovation. LA's growth in this sector is driven by its diverse talent pool, strong research institutions, and a culture of environmental consciousness. The city's unique mix of legacy industries, such as entertainment and aerospace, alongside emerging tech companies, positions it as a pivotal player in the climate tech landscape. This shift reflects a broader trend of decentralized climate tech funding across the U.S., reducing the historical dominance of California's traditional hubs. - learn more

Silicon Beach: Looking Back, Moving Forward

Assessing the overall health of the startup market is challenging, especially as venture capital funding has decreased by an average of 61% from 2021 to 2023 across the top VC markets in the US. Markets with robust ecosystems in AI, SaaS, Biotech, Healthtech, and Fintech appear to be weathering the downturn better than those focused on Consumer and Gaming industries, areas where Los Angeles traditionally excels.

Percent Change In VC Funding By Region

CB Insights

LA Times paints a rather bleak outlook on the Los Angeles tech scene noting venture capital funding in Greater Los Angeles plummeted 73% from 2021 to 2022. Silicon Beach, once a vibrant tech corridor, currently faces high vacancy rates and lacks late-stage financiers, especially in the AI sector. However, there are positive signs, including growth in aerospace startups and increased venture capital investment in early 2024, suggesting a potential rebound for LA's tech ecosystem.

While LA may not be exceeding expectations during this period, its tech ecosystem warrants a nuanced evaluation, given the broader market dynamics and its strong performance in specific sectors. Reach out to us with your thoughts.

🚀 SpaceX gears up for another stellar year, active raises, and more

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Happy Friday Los Angeles! You made it through the first week of 2024!

🔦 Spotlight

Elon Musk may be a divisive (albeit entertaining) figure, but the continued success of SpaceX is pivotal for the aerospace industry in Los Angeles and more broadly around the world.

Image Source: SpaceX webcast

What happened with SpaceX in 2023?

  • Elon Musk challenged Facebook founder, Mark Zuckerberg to a cage fight.
  • SpaceX launched 96 successful missions with its Falcon series of rockets, a 57% increase over its previous annual record.
  • SpaceX conducted two test flights of the largest and most powerful rocket ever built, Starship.
  • Roughly two-thirds of SpaceX's launches in 2023 were devoted to building out Starlink, the company's satellite-internet megaconstellation.
  • Isaacson’s Elon Musk biography was published in September including everything from Musk’s tumultuous relationship with his father to his work ethic and “demon mode”.

Moving forward what can we expect from SpaceX and its controversial founder? Continued innovation pushing the aerospace industry to new limits? Yes. More drama? Without a doubt.

Here is some of what is to come in 2024:

🤝 Venture Deals

Just Announced

Check back next week!

LA Exits

  • CG Oncology, an Irvine, CA-based developer of immunotherapies for bladder cancer, filed for a $100M IPO. It plans to list on the Nasdaq (CGON) with Morgan Stanley as left lead underwriter, and has raised around $317m in VC funding. - learn more
  • McNally Capital agreed to sell Advanced Micro Instruments, a Costa Mesa, CA-based maker of gas analyzers and sensing technologies, to Enpro (NYSE: NPO). - learn more

Actively Raising

  • ReelCall, Inc., an entertainment technology company focused on powerful apps and platforms that help build and maintain the professional network of connections vital to career growth, is raising a $850K Pre-Seed Round. - learn more
  • CZero, a hard-tech startup that is developing a technology for decarbonizing natural gas, is raising a $1.5M Seed Round. - learn more
  • Couri, a technology startup addressing last-mile delivery issues, is raising a $450K Pre-Seed Round at a $2.2M post money valuation. - learn more
  • Sweetie, a marketplace to help people plan date nights, is raising a $250K Angel Round. - learn more
  • StartupStarter, an investment platform that provides real-time data and analytics on startups, is raising an $850K Angel Round. - learn more

If you’re a founder raising money in Los Angeles, give us a shout, and we’d love to include you in the newsletter!

📅 LA Tech Calendar

Sunday, January 7th

Wednesday, January 10th

  • Startup Cafe: Networking with a Kick - Entrepreneurs, Startups, and Tech Enthusiasts join together to meet and connect with like-minded people, industry professionals and investors, while enjoying a nice cup of coffee in Venice at The KINN. This week’s interactive discussion about AI’s evolution in entertainment will feature Dr. Sam Khoze and Rachel Joy Victor.
  • Venice Tech Happy Hour- Join Startup Coil and FoundrHaus Wednesday evening and enjoy the sunset from the rooftop, grab a bite overlooking Abbot Kinney, and mingle with other tech enthusiasts and entrepreneurs by the bar on the patio.

Have an awesome event coming up? Reach out to be featured on next week’s Newsletter!

📙 What We’re Reading

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