Business
OpenAI dreams of Apple | Fortune
OpenAI’s DevDay, held Monday at San Francisco’s historic Fort Mason, was exceptionally Apple-coded.
It seems obvious to say—after all, CEO Sam Altman has previously spoken about his admiration of Steve Jobs and iPhone designer Jony Ive is now at OpenAI, to the tune of billions. But sitting in a bright, converted firehouse, watching Altman and other OpenAI leaders (Greg Brockman, Brad Lightcap, and Nick Turley) take questions, I realized I’d never thought that corollary (or ambition) through entirely.
The day’s product announcements were odes to simplicity and ease of use. The company’s AppsSDK featured tie-ins with partners like Canva and Zillow, while the AgentKit product was the first thing I’ve seen so far that actually makes me think I have a fighting chance of building an agent of my own. Codex, OpenAI’s coding tool, became available to all, with a Slack integration to boot.
The message, textually and subtextually, over and over was encapsulated in something Altman said to the crowd during the morning keynote: “We’re going to focus on what matters most to you all, which is making it easier to build with AI.”
With its $500 billion valuation, OpenAI has become one of the most powerful and influential privately held companies to ever come upon the tech sector. Still, there’s a lot of tension embedded in OpenAI’s story right now.
On one hand, they’re a dazzling market leader, with 800 million weekly active users, and the power to move public markets. On the other hand, there are areas in which OpenAI isn’t the obvious winner. A number I kept turning over in my head: OpenAI has four million developers on its platform, which is the same number of developers working with startup Supabase, which I covered last week as they hit a $5 valuation. It’s a contradiction—one of the most powerful companies in the world, yet with no guarantee of permanence.
In this vein, OpenAI seems to be operating with a keen awareness of its competitive environment and is candid about what it doesn’t know. In response to a question about how advertising may affect ChatGPT, Altman told journalists: “This is exactly why we’re trying to keep an open mind right now, because it’s impossible to foresee certain interaction effects between those decisions…We’re being humble about the future for reasons you suggest, but we’re working toward it.”
The day ended with a conversation between Altman and Ive, both of whom I’d never seen in person before. Sitting side by side, they come across as a thoughtful, deeply optimistic pair. And I thought about how the goal in the end is still something that, for OpenAI, for all its dominance, is a way off—a quiet, pervasive, long-term infrastructural place in society.
“If the solution is clever, it should just work,” said Ive, echoing the famous Apple design mantra, a paradigm that also applies to companies. “It should seem inevitable, as if there wasn’t possibly another rational solution to the problem.”
Term Sheet Podcast… On Monday, I sat down with OpenAI COO Brad Lightcap at the company’s DevDay in San Francisco to discuss where the company stands in the enterprise market, his thoughts on the “AI bubble,” that MIT study, his startup background, and more. Listen and watch here.
See you tomorrow,
Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
Submit a deal for the Term Sheet newsletter here.
Joey Abrams curated the deals section of today’s newsletter. Subscribe here.
Venture Deals
– Affinia Therapeutics, a Waltham, Mass.-based drug developer for cardiovascular and neurological diseases, raised $40 million in Series C funding. New Enterprise Associates led the round and was joined by Eli Lilly and existing investors.
– Lumen Bioscience, a Seattle, Wash.-based developer of orally-delivered biologics, raised $30 million in a Series C extension. WestRiver Group led the round and was joined by the Gates Foundation and others.
– AeroRX Therapeutics, a La Jolla, Calif.-based drug developer for chronic respiratory diseases, raised $21 million in Series A funding. Avalon BioVentures led the round and was joined by Correlation Ventures, Alexandria Venture Investments, and others.
– Membrion, a Seattle, Wash.-based developer of adaptive water infrastructure, raised $20 million in Series B1 funding from Pangaea Ventures, PureTerra Ventures, and others.
– Energy Robotics, a Darmstadt, Germany-based developer of robots and drones for autonomous inspection of critical infrastructure, raised $13.5 million in Series A funding. Blue Bear Capital and Climate Investment led the round and was joined by Futury Capital, Hessen Capital, Kensho VC, and TADTech.
– Zingage, a New York City-based AI-powered automation platform for home health care agencies, raised $12.5 million in seed funding. Bessemer Venture Partners led the round and was joined by TQ Ventures, South Park Commons, and others.
– Arcjet, a San Francisco-based codebase security platform, raised $8.3 million in Series A funding. Plural and Ott Kauver led the round and was joined by Andreessen Horowitz, Seedcamp, and angel investors.
– Datamonk, an Amsterdam, The Netherlands-based developer of AI technology for transferring medical image data, raised $1.9 million in pre-seed funding. Healthy.Capital and Nina Capital led the round and were joined by angel investors.
Private Equity
– Vistara invested $12 million in Authentic8, a Redwood City, Calif.-based cybersecurity company.
– Bishop Street Underwriters, a portfolio company of RedBird Capital Partners, acquired Avid Insurance, a London, U.K.-based insurance company. Financial terms were not disclosed.
– Commonwealth Electrical Technologies, backed by Broad Sky Partners, acquired NuWave Energy Solutions, a Norwell, Mass.-based energy efficiency and renewable energy company. Financial terms were not disclosed.
– GenNx360 Capital Partners agreed to acquire Heartland Business Solutions, a Little Chute, Wisc.-based IT services company, from A&M Capital. Financial terms were not disclosed.
Funds + Funds of Funds
– Northlane Capital Partners, a Bethesda, M.D.-based private equity firm, raised $750 million for its third fund focused on health care and business services companies.
People
– BayPine, a Boston, Mass.-based private equity firm, hired Amy Harsch as partner, head of capital formation and investor relations. Previously, she was with American Securities.
– Permira, a London, U.K.-based private equity firm, hired Caitlin Brodie as a managing director in its U.S. Capital Formation team. Previously, she was with The Carlyle Group.
