Startups Weekly Recap: IPO Hopes, Funding Gaps, and a Rebound in VC Confidence

Welcome to your latest Startups Weekly, where we distill the most compelling developments in the startup ecosystem — from IPO rumblings to funding frustrations, and everything in between.

Despite signs of a market recovery, the current startup climate continues to send conflicting signals. This week, we saw a high-profile IPO filing amidst a broader downturn in exits. Some founders are still raising significant capital, while others are shutting down entirely or struggling to keep pace with their global counterparts. Venture capitalists, meanwhile, seem to be adapting with impressive agility.

IPO Ambitions and Startup Setbacks

The startup sector was marked by sharp contrasts this week — with several companies pushing ahead optimistically, even as others faced tough setbacks.

Figma Moves Ahead Amid IPO Uncertainty

Defying recent IPO hesitations, design software firm Figma has submitted confidential paperwork to go public. The move is particularly bold considering Klarna and StubHub postponed their IPOs earlier this month due to investor jitters sparked by tariff-driven stock market fluctuations.

However, Figma isn’t steering clear of drama entirely — it has issued a cease-and-desist notice to rival Lovable, an up-and-coming “vibe coding” startup, over the usage of the term “Dev Mode.”

UK Startups Voice Funding Disparities

Across the Atlantic, British founders are expressing deep frustration over the widening funding gap between the UK and Silicon Valley. Dealroom reports that startups in the UK raised only £16.2 billion (approximately $21.5 billion) last year — a stark contrast to the $73.8 billion (or £65 billion) secured by U.S. startups during the same period

Startups That Didn’t Make It

Several companies hit roadblocks this week.

• Smashing, an AI-driven content curation tool launched by Otis Chandler, founder of Goodreads, announced it was shutting down due to slower-than-expected growth.

• In India, BluSmart, a sustainable ride-hailing alternative to Uber using electric vehicles, abruptly suspended operations. This comes just a day after India’s Securities and Exchange Board began investigating Gensol Engineering, a company with shared co-founders.

Bolt’s CEO Returns with a “Super App” Vision

Ryan Breslow, after recently resuming his role as CEO of Bolt, unveiled a new fintech “super app” designed to unify the digital shopping experience. The app reflects a reinvigorated strategy for the company he originally founded in 2014.

Rippling Faces Legal Obstacles Abroad

HR software firm Rippling continues its legal pursuit against Deel CEO Alex Bouaziz, though its efforts have been stymied by jurisdictional issues. Both Bouaziz and his legal counsel are reportedly in the United Arab Emirates, complicating the delivery of legal documents. Meanwhile, Rippling is also calling on Revolut to disclose the source of payments allegedly made to a corporate spy tied to Deel

AI Coding Wars Heat Up

In a major potential acquisition, OpenAI is reportedly eyeing Windsurf (formerly known as Codeium) in a $3 billion deal. The startup’s AI coding tools, which rival platforms like Cursor, have gained significant traction in the developer community.

VCs See Signs of Recovery

While founders remain cautious, this week’s funding news hinted at a more optimistic future for the venture capital space — especially with new funds and rising valuations.

Notable Rounds and Valuations

• Marshmallow, a UK-based insurance startup focused on underserved drivers, raised $90 million in equity and debt, securing a valuation just over $2 billion. The firm insures over a million drivers and is generating an annual run rate of $500 million in revenue.

• Hammerspace, which helps companies like Meta manage unstructured data, raised $100 million. Sources report its current valuation exceeds $500 million.

• Chapter, a Medicare advisory company co-founded by Vivek Ramaswamy, closed a $75 million round, reaching a $1.5 billion valuation.

• Phantom Neuro, a Texas-based medtech firm, brought in $19 million to further develop a wristband-like device that helps amputees operate prosthetic limbs.

• Conifer, a hardware startup building electric motors without rare earth materials, raised a $20 million seed round from deep tech investors.

• Arnergy, backed by Bill Gates’ Breakthrough Energy Ventures, secured a $15 million Series B extension to expand its solar energy footprint in Nigeria.

VC Funds Scaling Up

The bullishness isn’t limited to startups. Founders Fund, led by Peter Thiel, successfully closed its third growth-stage fund at $4.6 billion — a significant increase from the prior $3.4 billion fund. This signals a shift in sentiment, suggesting that venture capital may be climbing out of its recent bear phase.

Liquidity in a Dry Exit Market

In the face of limited IPO activity, venture firms are still finding clever ways to generate liquidity. On the latest episode of StrictlyVC Download, Hans Swildens, CEO of Industry Ventures, detailed how firms are leveraging secondary markets and creative deal structures to navigate the current dry spell for exits.

“VCs know how to unlock capital, even when the traditional doors remain closed,” Swildens explained.

Final Thoughts

This week underscored the paradoxical nature of today’s startup landscape: optimism intertwined with caution, innovation alongside retrenchment. With IPO pipelines slowly reopening and venture funds replenished, 2025 may yet turn into a comeback year — if the mixed signals begin to align.

Stay tuned for next week’s roundup, and as always, subscribe to the Cyprus Business Group Weekly Update for the latest insights from the world of business and startups.

Author: Din Kumar