On today’s episode of Equity, we’re taking a look at news you might’ve missed over the holiday weekend here in the U.S., starting with the recent OpenAI security breach. While it doesn’t seem that people have to be too worried about what the hackers actually accessed, the fact that it happened is worth paying attention to.
The Data Breach and AI Companies as a Target
According to TechCrunch’s Devin Coldewey, AI companies are treasure troves of data and will likely become more of a target for hackers. Companies that work with the large AI companies should pay attention. This is not just a concern for the big players in the industry but also for smaller startups that rely on these larger companies’ technology.
Coldewey argues that AI companies have access to vast amounts of sensitive data, including user information, financial transactions, and even intellectual property. With this kind of data at their disposal, hackers can wreak havoc on not just the company itself but also its users and partners.
As AI continues to advance and become more integrated into our daily lives, it’s essential for companies to prioritize data security. This means implementing robust measures to protect against cyber threats and having a plan in place in case of a breach.
Fisker’s Slide into Bankruptcy
In other news, Fisker, the EV startup, has asked its bankruptcy judge for permission to sell its remaining inventory for $14,000 a vehicle. This is a noticeable drop from the $70,000 Fisker was initially asking for. Some people are fearing that this Chapter 11 bankruptcy could turn into a Chapter 7.
Fisker’s struggles have been well-documented in recent years. Despite receiving significant investment and having some high-profile backers, the company has faced numerous challenges, including production delays and quality control issues.
As Fisker tries to navigate its financial difficulties, it’s worth noting that the EV market is becoming increasingly competitive. With established players like Tesla and new entrants emerging, it’s essential for companies like Fisker to differentiate themselves and offer a compelling product at a price point that resonates with consumers.
A New Trend: Venture Funds Helping Seed Investors Exercise Pro Rata Rights
Another trend worth discussing is the growing number of venture funds helping seed investors exercise their pro rata rights. This can be beneficial for smaller funds as it allows them to maintain their equity stakes and avoid dilution.
However, pro rata rights discussions can get contentious, and bringing more capital to the table may not necessarily help resolve these issues. In fact, it could lead to more tension between investors and founders.
When considering a potential investment, founders should be aware of the potential for pro rata rights disputes. It’s essential to have open and transparent communication with your investors about your expectations and goals.
Conclusion
In conclusion, today’s episode of Equity has highlighted several key points:
- The recent OpenAI data breach serves as a reminder that AI companies are treasure troves of sensitive data and will likely become more targeted by hackers.
- Fisker’s slide into bankruptcy is a cautionary tale for startups navigating the competitive EV market.
- Venture funds helping seed investors exercise pro rata rights can be beneficial but also raises potential for contention between investors and founders.
We’ll be back on Wednesday with an interesting conversation between Mary Ann and angel investor and Floodgate co-founder Mike Maples Jr. We’ll talk to you then!
Equity is TechCrunch’s flagship podcast, produced by Theresa Loconsolo, and posts every Monday, Wednesday, and Friday.
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- For the full episode transcript, check out our full archive of episodes over at Simplecast.
Rebecca Szkutak
Senior Reporter, Venture
Becca is a senior writer at TechCrunch that covers venture capital trends and startups. She previously covered the same beat for Forbes and the Venture Capital Journal.
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