🧑💻 Developer-First #145 - Fast ARR ≠ Durable ARR
Why Some VCs Are Cautious About AI Startups
Hello friend,
A VC recently told me they won’t invest in any AI startup, even those showing explosive growth.
While I understand the caution around a hype-driven market with sometimes sky-high valuations, I was surprised.
“What about a startup that hits €1M ARR in just a few months?” I asked.
His answer stuck with me:
There’s a big difference between fast ARR and durable ARR.
In today’s AI gold rush, companies are trying every shiny new tool—often simultaneously.
Take developer tools: an enterprise might be paying for GitHub Copilot, Cursor, and a third code assistant… but hasn’t yet decided which one to keep.
Meanwhile, the barrier to entry has never been lower. Foundation models are commoditised, and tools like Copilot make it easy to clone products. Expect significant churn in the coming quarters.
So, what should AI startups focus on to build sustainable growth?
✅ Unique and high-quality data – Own your training sets.
✅ Deep enterprise integration – Become a pain to rip out.
✅ Verticalization – From infra to app, control the entire stack.
The winners won’t necessarily be the fastest—but the ones who become indispensable.
P.S.: Several CTOs and tech leaders have recently contacted me about my former Unicorn CTO live training program, so I might do a limited edition session in May. Click here to learn more about the program, or contact me directly if you’re interested.
Now, let's dive into last week's developer-first transactions.
💰 Market Summary - Week of March 17th, 2025
12 companies raised $180,8 million across 6 product categories in 4 countries.
Europe-based companies attracted 47.1% of the total funding vs 52.9% for North America-based companies.
Cloud is the category that attracted the highest funding.
3 companies provide or contribute to an open-source product.
4 companies were acquired this week.
🧩 Funding by Product Category
🌎 Funding by Region
🏢 Funding By Company
Cognition from New York 🇺🇸 raised an undisclosed amount led by 8VC at a valuation close to $4 billion. Cognition is transforming software engineering with Devin, the first AI software engineer, creating AI teammates that enable engineers to focus on more complex problems and achieve ambitious goals. (more)
Evroc based in Stockholm 🇸🇪 secured $55 million in Series A funding. Evroc is establishing a secure, sovereign, and sustainable hyper-scale cloud to power digital Europe, promising best-in-class services and an exceptional developer experience. (more)
Graphite from New York 🇺🇸 raised $52 million in Series B funding led by Accel. Graphite offers a streamlined code review platform that enables engineers to write and review smaller pull requests, stay unblocked, and ship faster. (more)
Rerun also from Stockholm 🇸🇪 raised $17 million in Seed funding led by Point Nine. Rerun is pioneering SDKs for building time-aware visualisations of multimodal data, widely used in computer vision and robotics for debugging and demonstrations. (more)
VulnCheck from Lexington 🇺🇸 secured $12 million in Series A funding led by Ten Eleven Ventures. VulnCheck offers vulnerability intelligence solutions that help organisations preemptively address potential avenues of cyber attack. (more)
Arcade.dev in San Francisco 🇺🇸 raised $12 million in Seed funding led by Laude Ventures. Arcade.dev introduces an AI tool-calling platform that allows AI to securely perform tasks on behalf of users through authenticated integrations. (more)
Kosli from Oslo 🇳🇴 raised $10 million in Series A funding led by Deutsche Bank Ventures and Heavybit. Kosli focuses on automating compliance in software delivery, enhancing speed, security, and scalability for enterprises. (more)
Pluralis based in San Francisco 🇺🇸 secured $7.6 million in Seed funding led by CoinFund and Union Square Ventures. Pluralis is developing a protocol for decentralised training and ownership of foundation AI models. (more)
Featherless.ai also from San Francisco 🇺🇸 raised $5 million in Seed funding. Featherless.ai offers a GPU orchestration system that enables serverless AI inference across a wide range of open-source models. (more)
Camber from San Francisco 🇺🇸 raised $4 million in Seed funding led by Base10 Partners. Camber provides a cloud computing platform that offers scalable and easy-to-use APIs, tailored for scientific research and complex simulations. (more)
mogenius from Cologne 🇩🇪 raised $3.2 million in Seed funding led by seed + speed Ventures. mogenius simplifies Kubernetes deployment and management, enhancing productivity with automated workflows and integrated security features. (more)
Hunted Labs in Los Angeles 🇺🇸 secured $3 million in Seed funding led by Red Cell Partners. Hunted Labs focuses on software supply chain security, helping developers identify and mitigate threats. (more)
🤝 Mergers & Acquisitions
Gretel based in Palo Alto 🇺🇸 has been acquired by NVIDIA. Gretel is dedicated to solving the data bottleneck for AI professionals by providing safe, fast, and easy access to data through APIs that generate anonymised and synthetic data, enhancing privacy and speeding innovation. (more)
CastorDoc from New York 🇺🇸 and Paris 🇫🇷 has been acquired by Coalesce. CastorDoc revolutionises data collaboration with its automated data discovery and catalogue tool, serving as a single source of truth for all data-related knowledge within organisations. (more)
P4 One (formerly Snowtrack), located in Montreal 🇨🇦, was acquired by Perforce Software. P4 One offers a distributed version control system tailored for the Games, Animation, and VFX industries, focusing on flexibility and compatibility. (more)
Cyral in Milpitas 🇺🇸 was acquired by Varonis. Cyral provides robust data security solutions for privacy, compliance, governance, and protection, reducing risks and costs associated with managing structured data. (more)
⭐️ Trending GitHub Repositories
glanceapp / glance (✩ 6,775 stars this week) - A self-hosted dashboard that puts all your feeds in one place.
punkpeye / awesome-mcp-servers (✩ 4,597 stars this week) - A collection of MCP servers.
langchain-ai / local-deep-researcher (✩ 3,234 stars this week) - Fully local web research and report writing assistant.
Shoutout to suitenumerique / docs, an open-source alternative to Notion or Outline that has also been trending this week and made HackerNews front page. Docs is the result of a joint effort lead by the French 🇫🇷🥖(DINUM) and German 🇩🇪🥨 governments (ZenDiS).
👍 Trending Developer-First Products on ProductHunt
Supametas.AI (👍 553) - We transform messy content from websites, documents, PDFs, blogs, podcasts, etc. into perfectly organised datasets. Our smart processing helps AI companies build better products by giving them clean, structured data without requiring data processing expertise.
Prompt Engineering Studio (👍 531) - Prompt engineering studio lets teams build, test, and deploy AI prompts at scale. Includes prompt playground, version control, collaborative editing, and AI gateway integration supporting 1600+ models and AI agent frameworks.
Inbox by Novu (👍 485) - We are launching our redesigned component for React. Drop in 6 lines of code and get a stunning notification system with real-time updates and built-in user preferences. Ship faster, delight users, and stop reinventing the notification wheel.