Y-Combinator sacks nearly 20% of its employees in a move to prioritise early-stage investing

Hello there! Welcome to another roundup of the major global tech news this week.

This week in the tech space was largely dominated by speculations influenced by the collapse of major banks, including Silicon Valley Bank (SVB), Silvergate, and Signature. Startup accelerator, Y-Combinator sacked nearly 20% of its employees this week, although it explained that the collapse of the SVB did not influence this decision.

Chipper Cash, an SVB-backed startup, has begun exploring the possible options to ease its troubles, including sales,

Stripe, which has become one of Silicon Valley’s most celebrated start-ups with investments from prestigious venture funds, raised over $6.5 billion in Series I funding to value the company at $50 billion, about half its valuation two years ago.

The capital round by Stripe is an example of what is referred to as a “down round”, in which the company receives less money than it did during a prior fundraising round.

If you missed the major news coming from the tech space in this activities-filled week, sit back tight as we bring you the roundup of the biggest news making the round.

Summary of the Bulletin

• LinkedIn is working on an AI to help users write their profiles
• Y-Combinator sacks nearly 20% of its employees
• Naspers shuts down Foundry, its $100M fund
• Twitter Blue is now in Nigeria and South Africa
• Meta is building an app to rival Twitter

Read also: Bank of London considers rescue bid for UK arm of Silicon Valley Bank

Y-Combinator sacks nearly 20% of its employees

According to a statement made on Monday, Y Combinator will be writing fewer checks for late-stage firms as part of a scale-back that also cost 17 team members their jobs or nearly 20% of the accelerator’s staff, TechCrunch reports

The accelerator claims that the Silicon Valley Bank’s failure was not a factor and that they have been strategizing about the shift “well before” the collapse; over 30% of Y Combinator’s startups are exposed to SVB.

YC CEO Garry Tan wrote in the memo that the accelerator largely focused on early-stage investing and found late-stage investing to be a “distraction from our core mission.”

“There shouldn’t be any noticeable effect on the companies we’ve funded or on the way we interact with alumni, but if any companies or alumni have questions, I’m here and the YC group partners are here — as always, to help you make something people want,” Tan wrote in the memo.

Early on, Tan told YC companies that “anytime you hear problems of solvency at a bank, and it can be deemed credible, you should take it seriously and prioritize the interests of your startup by not exposing yourself to more than $250,000 of exposure this year,”

LinkedIn to introduce AI-feature that will write users’ profiles

With Microsoft now seeking to integrate OpenAI’s conversational GPT back-end into virtually all of its apps and software, it is no surprise to see LinkedIn, a Microsoft-owned platform looking to add AI features to its platform.

The platform’s users are set to enjoy a new GPT-powered tool to provide personalized writing suggestions for creating LinkedIn profiles.

The feature, when launched, would provide new options for creating users’ LinkedIn profiles, while it will also add AI-generated job descriptions, as well as new educational opportunities in AI tech via LinkedIn Learning.

The system will use OpenAI’s GPT models to generate these new summaries, making it much easier to represent the user’s skills and experience creatively to stand out.

LinkedIn’s also testing a new AI-powered job description tool, making it faster and easier to write job descriptions. 

Naspers shuts down Foundry, its $100M fund

Naspers, Africa’s most valuable tech company by market capitalization, has shut down its R1.4bn SA-focused technology investment fund, Foundry, as the group slims operations and venture capital takes a hit globally.

The group will maintain its investments through the four-year-old fund, including successful start-ups such as the online home-cleaning business SweepSouth.

According to the report, Naspers will no longer have a specific staff focused on South African businesses and will instead align its efforts with the strategy it uses abroad through Prosus Ventures, which will now be responsible for preserving Naspers’ local investments.

“The global investment environment, as well as the local SA one, has changed, and we have made clear the need for our business to adapt. In line with changes across the wider business, we have reviewed our early-stage investment strategy within SA to bring it in line with our international approach,”

a Naspers spokesperson said

“Naspers will continue to support the development of SA’s early-stage tech sector, assessing the market and new opportunities in a way that is consistent with our other global markets”, he added.

Twitter Blue is now in Nigeria and South Africa

Users in Nigeria and South Africa discovered this week that Twitter Blue is now offered in their nations for N5,000 and R144.99 per month, respectively.

Previously, service subscribers in both nations used virtual private networks to connect to the IP addresses of other nations where the service is offered.

As part of its rollout this week, Twitter offered a 12% discount to Nigerian users and a 13% discount to South African users if they choose the annual subscription. However, the prices for the subscription, based on the device, are not uniform.

Those subscribing on their iOS and Android devices pay the flat rate of ₦5,000 and R200.00 monthly, while those subscribing for the web service will pay ₦3,650 and R144.99 monthly.

For those who choose the annual membership, the costs are R1,519 and N38,500 for web access and R52,900 and R2,099 for iOS and Android devices, respectively. Every nation with access to Twitter Blue has used this pricing model consistently.

Meta is building an app to rival Twitter

Meta is in the early stages of building a dedicated app for people to post text-based updates to rival Twitter.

“We’re exploring a standalone decentralized social network for sharing text updates,” the company told Platformer. “We believe there’s an opportunity for a separate space where creators and public figures can share timely updates about their interests.”

News that Meta has been exploring a text-based network was first reported last week Thursday by MoneyControl. The outlet reported that the app is codenamed P92 and will allow users to log in through their existing Instagram credentials.

The project has few specifics. According to reports, the product is still in its early phases, and a release date has not been set. But, we’re informed that legal and regulatory teams have already begun to look into any potential privacy issues with the app so that they may be resolved before launch.

Sources said Adam Mosseri, who runs Instagram, is leading the project.

The most remarkable aspect of the project is that Meta plans for the network to be decentralized. While the company would not elaborate beyond its statement, in a decentralized network, individual users can typically set up independent servers and set server-specific rules for moderated content.