Gm. Happy national Slurpee Day! We wouldn’t be doing our job as newsletter writers if we didn’t remind all 14,000 of you to snag a free frozen beverage at your local 7-Eleven today in honor of 7/11. 

FRESH POWDER

Looking at three funds that recently topped up their coffers. 

Startup to watch: It sounds simple: a jobs board that connects entry-level workers with fulfillment centers and events, yet this approach helped Traba earn a $20 million Series A from a VC lineup reminiscent of the ‘92 Bulls (Khosla, Founders Fund, and Atomic, to name a few). Traba promises to help solve warehouse staffing issues where annual turnover rates reach 40%.

SOCIAL MEDIA 

Elon bails

By now, you've surely heard the news: Elon Musk has officially decided he no longer wants to complete his purchase of Twitter for $44 billion. 

Elon is playing the Uno reverse card on the deal because he thinks Twitter is in “breach” for allegedly refusing his request for more information around bots on the platform.

While those issues may be big enough in Elon’s mind to terminate the deal, there’s only one problem: He already signed a binding merger agreement. 

• Putting our legal hat on for a moment, the only way to get out of the deal would be if Twitter was lying about the bots to such a degree that it has a “material adverse effect” (a famously ill-defined term that typically has to be something catastrophic) on the company. But Twitter has publicly defended its methodology and does not appear to be lying, so it begs the question…

Was it all just a ruse?

One popular theory is that Elon has been using the deal as a cover to sell Tesla options that were about to expire. Henry Blodget, founder of Business Insider, tweeted that the Twitter bid allowed Elon to sell his 10-year stock options “without his facing questions about why he was selling.”

• The math makes sense: Taking into account the $1 billion breakup fee he is slated to pay as well as the ~$100 million he’ll spend fighting litigation, Musk still stands to net $~7.5 billion from selling his Tesla stock.

Twitter’s reaction

We’ll see you in court, buddy. The social media platform is vowing to sue Elon in order to force the deal to close. "We are confident we will prevail in the Delaware Court of Chancery," Twitter’s  chairman of the board Bret Taylor tweeted, which is one of the all-time great legal threats you can muster. 

Bottom line: This is not the last we’ve heard of Elon vs. his favorite social media platform. A lengthy court battle no doubt awaits. 

LAYOFFS 

Layoffs dominated H1

As the first half of the year winds down and H2 kicks off, one of the year’s main storylines thus far has been the drastic increase in the pace of startup layoffs. 

Let's look at the data

Fintech startups are getting rekt. After hoovering up roughly 21% of all venture capital dollars raised last year, fintech startups are leading the pack in a less desirable statistic this year: layoffs. 

• 4,189 fintech employees were let go in the first half of this year accounting for 15.4% of all startup layoffs. 

• For context, a grand total of zero fintech employees were laid off in the entirety of 2021 according to an analysis from Layoff.fyi.

In total, over 117 unicorns have reduced headcount since the start of the year, according to data from tech recruitment platform Trueup. Of that group, fintech, crypto, and real estate are leading the charge. 

Zoom out: Although layoffs were the story de jour of H1, that hasn’t stopped the venture dollars from flowing: the US saw 1,400 seed rounds in the last three months alone. 

QUICK HITS

Seed Round

Stat: American venture capitalists are sitting on a lot of dry powder. US-based VCs have raised more than $120 billion in 2022 so far which puts them on pace to crush the $138.9 billion they raised last year. It’s already way ahead of the $85.4 billion raised in 2020 (which was a record back then, believe it or not.) All that to say, founders could be in line for another funding bonanza in the second half of the year.  

Story we’re watching: In a gut punch to its largest rival (Carta), AngelList announced a suite of products that help companies manage their cap tables more effectively. Unlike Carta, AngelList’s new features don’t charge startups based on how many investors are on the cap table, but rather by the number of team members. AngelList says this structure incentives “founders to take as many checks as they need from investors.” 

Rabbit hole: As TikTok grows, so does suspicion (The Economist). 

WHAT ELSE IS GOING ON

• Tesla will allow other electric vehicles to use its Supercharger plugs in the US later this year. 

• The Dutch Parliament approved work-from-home as a legal right if an employee’s profession allows it.

• The NFL plans to launch its own streaming service this fall, aptly titled NFL+.

• The co-founders of Three Arrows Capital, the newly bankrupt crypto hedge fund, have reportedly fled from Singapore.

TRIVIA

Florida, Texas, Arizona, and the Carolinas were the states with the largest gains in net income from 2019 to 2020. 

Which five states had the largest *income losses* during that same period?

MONDAY MUSING

There's lots of debate around whether having competition is a good signal for your company. While we know where Peter Thiel stands, we want to hear your take. 

LAYOFFS TRACKER

Notable layoffs this week:

Hopin (30%)

Twitter: 90 people (⅓ of Recruiting Team)

Next Insurance: 150 people (17%)

NEWS FROM THE HOUSE

Calling all designers

Designing alone: lame, sad, boring.

Designing with your friends: not lame, not sad, not boring.

Come explore with the most creative minds in the startup world.

FOUNDERS CORNER

The best resources we came across this weekend that will help you become a better founder, builder, or investor.

📑 How to scale a startup to $1 million ARR in 12 months (a playbook)

🧑‍💻5 Solidity Cheat-Sheets for programmers

🔑 The newsletter to make you a better storyteller

TRIVIA ANSWER

New York, California, Illinois, Massachusetts, and New Jersey.