TheChek News Flow

Chris Metinko

With AI creating new issues regarding theft of intellectual property, San Francisco-based startup Story Protocol raised an $80 million Series B to try to solve the increasing problem.

The new round was led by Andreessen Horowitz, with participation from Polychain and others. Founded in 2022, Story has raised $140 million to date, per the company. The new round reportedly values the company at $2.25 billion.

IP theft is nothing new, but the rise of AI has heightened the stakes as generative AI models are ingesting copyrighted material — without permission — to train and learn.

Story’s blockchain network allows IP owners to store their IP on the platform, embedding terms to use it — such as licensing fees — into smart contracts. Basically, the blockchain aims to ensure owners are compensated when their IP is used.

“Big Tech is stealing IP without consent and capturing all the profit,” said S.Y. Lee, co-founder of Story. “First, they will gobble up your IP for their AI models without any compensation. … The current state of AI completely destroys the incentive to create original IP for all of us.”

The funding announcement comes just a day after OpenAI announced a partnership agreement with Condé Nast to display content from the various publications it owns as AI companies are facing pushback from many media firms whose content they ingest.

Last year, OpenAI and its biggest backer, Microsoft, were sued by The New York Times regarding copyright issues related to using the newspaper’s intellectual property.

Other startups and media companies also have come to some sort of partnership agreements to allow AI models to use their content to learn as content producers seek to project their IP.

Move by Kazakh mining company Kazatomprom threatens to squeeze supplies of the radioactive fuel

Kazatomprom, the world’s largest uranium producer, has slashed its production target for 2025 due to project delays and sulphuric acid shortages, threatening to squeeze supplies of the radioactive fuel vital for nuclear power.

The Kazakh company, which generates a fifth of global uranium supply, cut its target for next year by 17 per cent to a range of 25,000 to 26,500 tonnes of yellowcake. 

The move is likely to put upward pressure on uranium prices, which have softened from a 16-year high above $100 per lb this year but remain at historically elevated levels above $80 per lb, according to UxC, a pricing data provider.

Meirzhan Yussupov, chief executive of Kazatomprom, said that “the uncertainty around the sulphuric acid supplies for 2025 needs and delays in the construction works at the newly developed deposits resulted in a need to re-evaluate our 2025 plans”.

Nuclear power has undergone a revival since the world was plunged into an energy crisis by Russia’s full-scale invasion of Ukraine, but uranium supplies have struggled to keep up with the boost in demand following a decade of under-investment in new production.

“This is a structural problem — they cannot ramp up,” said Nick Lawson, chief executive of Ocean Wall, an investment house that is bullish on uranium. “It won’t just be the west saying this is an issue for us; it will also be Russia and China saying it’s a problem for our new nuclear power plants.”

Utilities hold large stockpiles of uranium to power their nuclear reactors but they are willing to secure the nuclear fuel at almost any price, creating the conditions for volatile surges in prices of yellowcake.

Per Jander, director of nuclear fuel at WMC, a trader, said that Kazatomprom’s downgrade “should be a cause for concern for western utilities. The geopolitical developments and writing on the wall has been the Russians getting closer to the Kazakhs.”

Analysts at Canaccord Genuity said that they expected Kazatomprom to produce 23,000 tonnes in 2025, adding that the bottom line was “market to be tight next year”.

They added the company placed the target higher “to stay in the government’s good graces” given that it must come close to output levels specified in subsoil use agreements signed with Astana.

Because of expectations that it will not produce above the 80 per cent threshold in the next two years for Budenovskoye, one of its new uranium mines, Kazatomprom asked the government to lower targeted output volumes in the agreement. At another site, it also asked for the agreement to be amended.

Despite forewarning in February on the risk of cuts to the output forecast, inventories at Kazatomprom are running at the lowest ever reported, according to Canaccord Genuity, at 4,142 tonnes of uranium, down 31 per cent on the previous year.

Sulphuric acid, essential to extracting uranium from deposits, has been in short supply in Kazakhstan because of delays in building new acid plants, competition with the fertiliser industry and trade restrictions.

Further stoking insecurity in the market has been Russia’s central role in the conversion and enrichment of raw uranium into nuclear fuel, controlling almost 50 per cent of global enrichment capacity.

Kazatomprom has recently been rocked by a spate of executive departures including its chief financial officer Sultan Temirbayev, who resigned this month after only a year in the post.

Decision by regulator Ofgem means average yearly bill will be £1,717

Household gas and electricity bills in Britain will rise this winter after regulator Ofgem said it would lift the energy price cap by 10 per cent following an increase in wholesale costs.

Ofgem has set the cap for the period between October and December at a level that will mean a typical household pays £1,717 a year, compared with £1,568 a year now.

Friday’s decision is the first time the regulator has raised the cap since January and means bills for about 27mn households remain hundreds of pounds higher than before the energy crisis fuelled by Russia’s full-scale invasion of Ukraine in February 2022.

It comes after chancellor Rachel Reeves last month announced a £1.5bn cut to winter fuel payments for better-off pensioners as part of emergency savings to fill in a £22bn fiscal hole she claims she inherited from the Conservatives.

Jonathan Brearley, chief executive of Ofgem, said the watchdog recognised that the rise in the price cap would be “extremely difficult for many households” and warned that a return to pre-2022 costs was unlikely.

“I think what we need to accept is that this situation of volatile gas prices — gas prices being certainly higher than they were pre-crisis — is one that’s likely to be around for a long time,” he told the BBC.

“I don’t know that’s the case, but I think the government, Ofgem, the sector and consumer groups need to see this as a long-term, not a short-term, problem,” he added.

Energy secretary Ed Miliband said the 10 per cent increase would be “deeply worrying news for many families” and that ministers were working to lower bills by developing renewable energy projects.

“The only solution to get bills down and greater energy independence is the government’s mission for clean, homegrown power,” he said.

The price cap, introduced in 2019, sets a limit on how much energy companies can charge homes on default tariffs per unit of gas and electricity consumed. It is reset every three months to reflect changes in wholesale prices.

On a per unit basis the cap will rise from 22.36 pence per kilowatt hour to 24.50 pence per kWh hour for electricity, with a daily standing charge of 60.99 pence, up from 60.12 pence now. For gas, the cap will increase from 5.48 pence per kWh to 6.24 pence per kWh, with a daily standing charge of 31.66 pence, up from 31.41 pence.

Before winter 2021, Ofgem set the cap at levels that meant typical households paid less than £1,100 a year.

But the average bill hit a record high of £4,059 in January last year as wholesale prices surged after Russia’s invasion, forcing the previous Conservative government to launch a subsidy scheme.

The latest increase in the price cap is also connected to the war in Ukraine, with wholesale prices climbing over the past few months because of uncertainty over Russia’s remaining gas supplies to Europe.

Other elements of the cap, such as network costs, are linked to inflation and so have also risen in recent years.

Ofgem’s announcement highlights the challenges ahead for Prime Minister Sir Keir Starmer’s government as it pushes to cut energy bills in the longer term and hit net zero emissions in the electricity sector by 2030.

At present gas is used to heat the vast majority of Britain’s homes and to make more than one-third of its electricity, meaning any increases in wholesale gas prices have a significant impact.

Under measures set out by Reeves last month, winter fuel payments of up to £300 will be limited to people receiving pension credit and other means-tested benefits.

Shadow energy secretary Claire Coutinho said the government was pursuing “reckless net zero targets with no thoughts to the costs” and that the decision to scale back winter fuel payments meant “millions of pensions will have made no plans to deal with higher energy bills”.

Caroline Abrahams, at Age UK, said the increase in the price cap meant the WFP policy “spells disaster for pensioners on low and modest incomes or living in vulnerable circumstances due to ill health”.

Brearley declined to say if the price cap would rise again in January. But energy consultancy Cornwall Insight, which had predicted a 9 per cent rise in the cap from October, is forecasting a further 3 per cent increase from the start of next year.

Craig Lowrey, principal consultant at Cornwall Insight, said: “The lingering impact of the energy crisis has left us with a market that’s still highly volatile and quick to react to any bad news on the supply front.”

Venture funding to Israel-based startups has bounced back significantly after nosediving less than a year ago after the Hamas attacks and the Israeli response.

Funding to Israeli startups sank in Q4 last year as uncertainty swirled with the rise of tensions and violence. However, less than a year later and with tensions in the region still at a fever pitch, venture funding to VC-backed companies has picked back up — and even shows some signs of getting strong.

In the second quarter of this year, funding to startups in the region (startups with headquarters in the country) landed just under $1 billion, per Crunchbase data. Funding in the region had not hit $1 billion or more since Q3 of last year, when startups took in a staggering $1.6 billion. In fact, Q2 funding was nearly dead even with Q2 2023 numbers.

Soon after Q3 ended, violence hit the region and funding to startups barely managed to get to $500 million.

However, the country has seen two consecutive quarters of an uptick in funding, and the current quarter is on pace to be slightly more than $1 billion.

The dollar numbers are interesting on several different levels — not the least of which is the fact conflict is still raging in the region.

Despite that, startups seemingly have still been able to secure money — a lot of it in some cases. The largest rounds this year to VC-backed startups in Israel include:

What’s eye-catching about those rounds is that none fall into the industry most associated with the Israel startup scene — cybersecurity.

In fact per Crunchbase data, VC-backed cybersecurity startups only raised $66 million total in Q2, as other sectors such as enterprise software and — of course — generative AI stepped up their fundraising efforts.

The largest cyber round raised by an Israeli startup in Q2 went to browser security firm LayerX, which raised $26 million. In the current third quarter, cloud security company CTERA already has raised an $80 million round.

Along with those unexpected circumstances, it is also important to note Asia is at a near decade low for venture funding — meaning Israeli startups are bucking another trend.

Finally, while dollar figures are rising, deal flow remains low for the region, with only about 50 to 60 rounds being announced each quarter. Early last year and even before, deal flow for the region normally was around 120 to 130 funding rounds announced every quarter.

Those numbers indicate that Israeli startups are seeing big and medium-range rounds to help make up for fewer rounds closing, but perhaps seed and very early-stage firms are having trouble securing cash — which could pose problems in the future for the overall health of the region’s startup ecosystem.

Nevertheless, the resiliency of the venture and startup industry in Israel is eye-catching considering everything still going on in the region. When the fighting broke out, investors and founders alike all insisted the entrepreneurial spirit and innovation of the region would continue.

The numbers seem to make those words prophetic.