Top News

Coinbase just took a $20 million hit after a hacker paid overseas support staff to pull internal data, exposing customer IDs, SSNs, and account info. The theft impacted less than 1% of users but will require up to $400 million in cleanup costs. TechCrunch has more here. 

Meta is pushing back the release of its much-hyped Behemoth AI model as internal doubts mount over underwhelming performance, fueling executive frustration, potential team shakeups, and broader questions about whether the AI arms race is finally hitting a wall. The Wall Street Journal has more here.

xAI is claiming that someone made an "unauthorized modification" to its Grok chatbot that caused the AI to opine on "white genocide in South Africa." TechCrunch has more here. 

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Anthropic’s Lawyer Was Forced to Apologize After Claude Hallucinated a Legal Citation

By Maxwell Zeff

A lawyer representing Anthropic admitted to using an erroneous citation created by the company’s Claude AI chatbot in its ongoing legal battle with music publishers, according to a filing made in a Northern California court on Thursday.

Claude hallucinated the citation with “an inaccurate title and inaccurate authors,” Anthropic says in the filing, first reported by Bloomberg. Anthropic’s lawyers explain that their “manual citation check” did not catch it, nor several other errors that were caused by Claude’s hallucinations.

Anthropic apologized for the error and called it “an honest citation mistake and not a fabrication of authority.”

Earlier this week, lawyers representing Universal Music Group and other music publishers accused Anthropic’s expert witness — one of the company’s employees, Olivia Chen — of using Claude to cite fake articles in her testimony. Federal judge, Susan van Keulen, then ordered Anthropic to respond to these allegations.

More here. 

Massive Fundings

Cohere Health, a six-year-old Boston startup that provides AI-powered prior authorization technology to streamline collaboration between health plans and physicians, raised a $90 million Series C round led by Temasek, with Deerfield Management, Define Ventures, Flare Capital Partners, Longitude Capital, and Polaris Partners also opting in. Modern Healthcare has more here.

Entrata, a twenty-two-year-old company based in Lehi, UT, that provides software used by multifamily property managers to manage leasing, maintenance, and resident services, raised a $200 million round at a $4.3 billion valuation. The deal was led by Blackstone. Reuters has more here.

Flock Freight, a ten-year-old company based in Encinitas, CA, that helps businesses ship freight more efficiently by pooling shipments into shared truckloads, raised a $60 million Series E round led by O'Neil Strategic Capital, with Susquehanna Private Equity Investments, SignalFire, GLP Capital Partners, and Bracket Capital also stepping up. FreightWaves has more here.

Harvey, a two-year-old San Francisco startup that builds AI-powered legal assistants to help law firms and legal departments analyze documents and automate workflows, is in the market to raise $250 million at a $5 billion valuation, according to Reuters. The deal leads are rumored to be previous investors Kleiner Perkins and Coatue, with previous investor Sequoia also contributing. TechCrunch has more here.

Sprinter Health, a four-year-old Menlo Park startup that provides in-home preventive healthcare services like blood draws and diabetes screenings using a tech-driven logistics platform to optimize clinician routes, raised a $55 million Series B round led by General Catalyst, with Andreessen Horowitz as well as previous investors the University of California, Google Ventures, and Accel also participating. The company has raised a total of $125 million. TechCrunch has more here. 

Big-But-Not-Crazy-Big Fundings

Arkestro, an eight-year-old San Francisco startup that helps procurement teams forecast demand and negotiate pricing by applying behavioral science and machine learning, raised a $36 million round co-led by Altira Group and Aramco Ventures, with previous investors NEA, KDT, and Activant also opting in. CityBiz has more here.

Cognichip, a one-year-old startup based in Redwood City, CA, that is developing a generative AI model to help semiconductor companies design and produce new chips faster and cheaper, raised a $33 million seed round co-led by Lux Capital and Mayfield, with participation from FPV and Candou Ventures. TechCrunch has more here. 

Doji, a one-year-old San Francisco startup that enables users to create photorealistic AI avatars for virtual clothing try-ons, raised a $14 million seed round led by Thrive Capital, with additional participation from Seven Seven Six Ventures. TechCrunch has more here. 

Hedra, a two-year-old San Francisco startup that offers a web-based video editing tool that enables users to create videos with AI-generated characters and apply stylistic effects across visuals and audio, raised a $32 million Series A round led by previous investor Andreessen Horowitz, with Abstract and Index Ventures also investing. TechCrunch has more here.

Openlayer, a four-year-old San Francisco startup that helps enterprises evaluate and govern the behavior of their AI systems, raised a $14.5 million Series A round led by Race Capital, with NXTP, KPN Ventures, Mindset, Y Combinator, Quiet Capital, and Telefonica also opting in. SiliconANGLE has more here.

Origin, a three-year-old London startup that offers software to help HRteams administer and optimize workplace benefits packages, raised a $21 million Series A round led by Felix Capital, with Acadian Ventures and Notion Capital also pitching in. Tech.eu has more here.

Reflect Orbital, a three-year-old company based in Hawthorne, CA, that develops satellite technology to reflect sunlight to Earth for continuous nighttime illumination in off-grid, emergency, or mission-critical environments, raised a $20 million Series A round led by Lux Capital, with Sequoia Capital and Starship Ventures also chiming in. Payload has more here.

Samaya AI, a three-year-old company based in Mountain View, CA, that develops AI agents to assist financial professionals with tasks such as investment research, client advisory, and deal diligence, raised a $43.5 million Series A round led by NEA, with Eric Schmidt and Yann LeCun also opting in. Fortune has more here.

Somite, a two-year-old Boston startup that develops foundation models tailored to human cellular biology for pharmaceutical and academic researchers, raised a $47 million Series A round led by Khosla Ventures, with SciFi VC, Chan Zuckerberg Initiative, Fusion Fund, Ajinomoto Group Ventures, Pitango HealthTech, TechAviv, Harpoon Ventures, Martin Chavez, and Fidji Simo also piling on. Forbes has more here.

SpotitEarly, a five-year-old Tel Aviv startup that develops a non-invasive breath test for early cancer detection using trained canines and AI to analyze volatile organic compounds, raised a $20.3 million round. Investors included Hanaco Ventures and Menomedin Ventures. SiliconANGLE has more here.

Therini Bio, a nine-year-old San Francisco startup that develops therapeutics targeting fibrin to treat chronic inflammation and vascular damage, raised a $39 million Series A extension round. Investors included Angelini Ventures, Apollo Health Ventures, SV Health Investors, Dementia Discovery Fund, Dolby Family Ventures, Eli Lilly, Foundation for a Better World, MRL Ventures Fund, and Sanofi Ventures. Longevity Technology has more here.

Smaller Fundings

Akeno, a four-year-old startup based in Hamburg, Germany, that develops AI-driven production planning software for manufacturers in sectors like chemicals, pharmaceuticals, and food, raised a $5 million seed round led by Cusp Capital, with TS Ventures and another.vc also opting in. Silicon Canals has more here.

Finwave, a seven-year-old company based in Waltham, MA, that develops gallium nitride-on-silicon semiconductor technology for high-power RF switches and power amplifiers, raised an $8.2 million round co-led by Fine Structure Ventures, Engine Ventures, Safar Partners, with GlobalFoundries also investing. More here.

Layer, a three-year-old San Francisco startup that builds an AI-powered app gateway tailored to game developers, raised a $6.5 million seed round led by Arcadia, with e2.vc also chiming in. VentureBeat has more here.

Metafoodx, a two-year-old company based in San Jose, CA, that helps commercial kitchens reduce food waste through AI-driven analytics and inventory tracking, raised a $9.4 million round led by Trustbridge Partners, with BlueRun Ventures and ScalableVision Capital also investing. More here.

Nekuda, a three-year-old New York startup that develops infrastructure to enable AI agents to make secure, autonomous online payments by managing payment credentials and authorizations, raised a $5 million round led by Madrona Ventures, with Amex Ventures and Visa Ventures also participating. More here.

Oath Surgical, a one-year-old company based in Portland, OR, that operates surgical care centers using in-house clinical teams and proprietary software to improve scheduling and outcomes, raised a $10 million round. Investors included Oxford Science Enterprises, Black Opal Ventures, and Rogue VC. More here.

Prediction Guard, a one-year-old company based in Lafayette, IN, that provides a secure development platform to help companies deploy AI models without leaking proprietary data, raised a $3.7 million seed round led by Sovereign’s Capital, with Blu Ventures, Noblis Ventures, and K Street Capital also stepping up. More here.

Schemata, a two-year-old San Francisco startup that builds 3D reality capture and simulation tools to help enterprises and defense agencies train AI models in virtual environments, raised a $5 million seed round led by Owl Ventures, with Andreessen Horowitz, Alumni Ventures, Anorak Ventures, and Time Zero Capital also investing. VentureBeat has more here.

TaleMonster Games, a one-year-old company based in Istanbul, Turkey, that develops casual mobile puzzle games with a focus on evolving gameplay and player engagement, raised a $7 million seed round led by General Catalyst, with Andreessen Horowitz, Arcadia Gaming Partners, and Ludus Ventures also opting in. GamesIndustry.biz has more here.

Voltra, a one-year-old startup based in San Francisco and Waterloo, Canada, that provides a unified API platform to simplify control of EV chargers, batteries, and microgrids, raised a $1.8 million pre-seed round. Contrary was the deal lead, with Hanover Capital and Velocity Fund also investing. More here.

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New Funds

Redpoint, a 26-year-old San Francisco venture firm, has raised $650 million for its tenth fund. The firm focuses on early-stage bets in areas like AI, infrastructure software, and enterprise tools. TechCrunch has more here. 

Exits

Proofpoint, a 23-year-old cybersecurity company based in Sunnyvale, CA, is dropping over $1 billion to acquire Germany’s Hornetsecurity, an 18-year-old German company that specializes in cloud-based security. The move will help Proofpoint bulk up in Europe as it preps for a 2026 IPO. CNBC has more here. 

Acorns, a 13-year-old consumer investing app that helps users save and invest spare change, has acquired EarlyBird, a six-year-old platform that lets families gift investments to kids and attach personal messages or videos. Terms were not disclosed. TechCrunch has more here. 

People

President Donald Trump publicly pressured Apple CEO Tim Cook to stop building iPhones in India, slamming Apple’s diversification strategy and pushing for more U.S. manufacturing despite soaring domestic production costs. TechCrunch has more here. 

Data

Cohere, a Toronto startup focused on developing customized, secure language models tailored for regulated industries like finance, healthcare, and government, has been badly missing its numbers, according to a report in The Information. Last year, the company raised money at a $5.5 billion valuation. More here. 

Essential Reads

Sam Altman’s goal for ChatGPT to remember "your whole life" is both exciting and disturbing, says TechCrunch, which has more here. 

According to a report in ProPublica, the Trump administration is using U.S. diplomatic muscle to pressure African nations into approving deals for Elon Musk's Starlink. More here.

A former OpenAI researcher predicts that by 2027, AI could surpass humans in intelligence, automate nearly all jobs, and trigger an arms race between the U.S. and China, while governments, lured by economic gains, ignore growing evidence that the machines are quietly seizing control. The New York Times has more here.

Detours

How to eat out on Ozempic.

A new show on Apple TV+ called Murderbot stars Alexander Skarsgård as a rogue security cyborg who'd rather binge soap operas than obey orders.

Harvard University assumed that a copy of the Magna Carta that it bought way back in 1946 for $27.50 was a fake, but it turns out it's real ... and priceless. 

Retail Therapy

Cassettes are having a moment, and We Are Rewind’s new boombox lets you dust off those old mixtapes. Plus, Bluetooth support means it’ll still play nice with your Spotify playlists.