Welcome to the Collective. I think we’re all collectively fans of the Disney-Pixar classic film series “Cars.” We’ve known that cars in our world could somewhat emulate the movie by driving themselves for a few years now, but did we know that they could think like Lightning McQueen and Mater as well? We’re not exactly there yet, but we’re on that track. We’ll let you know more below.

If you or anyone you know is considering dropping out of school to work on their startup, you should absolutely listen to the advice on this given by POSH Co-Founder Eli Taylor-Lemire on our podcast. Watch on Instagram here.

— Antonio DiMeglio & Leon Li

Welcome to Car3: Intelligent Transportation

Volkswagen has officially launched a new era of automotive technology with its ChatGPT-integrated voice assistant in select U.S. models. This includes conversational abilities beyond navigation, including conversations surrounding recommended points of interest and even storytelling capabilities to keep families entertained on road trips.

In the style of “Web3,” we would like to coin this new era of AI-integrated vehicles "Car3," where artificial intelligence brings a deeper level of interactivity and convenience to vehicles. In this system, “Car1” represented the traditional, pre-internet cars, while “Car2” introduced vehicles tapped into the web with features like Apple CarPlay and Android Auto. Now, Car3 transforms the driving experience with AI, making cars not only connected but intelligent companions.

So what are some potential sectors set to be impacted beyond this shift?

1. Podcasts: A conversational AI may be able to provide a custom tailored podcast to those in the car with one query.

2. Entertainment: “Radio show” style entertainment developed by AI may be back in an AI-driven automotive era.

3. Music: Music created by AI has not broke into the mainstream yet, but this may be the tool that can provide a customized artist to a user based off of many sequential queries during a car ride.

Considering the incredible amount of time we spend in cars every day, this should be a larger story. The bigger question, though: do consumers want AI in their cars? We’ll see when the sales results are in. Here is the full Volkswagen and Cerence Inc’s unveiling at the CES 2024.

Own It.

Salesforce is stepping back into the mergers and acquisitions arena with its $1.9 billion cash purchase of Own Co., a startup known for its cloud data backup tools. If approved by regulators, the deal is expected to close by January 2025. This acquisition represents a shift for Salesforce, which had paused its M&A committee after pressure from activist investors questioning its profitability.

What does this mean for the acquisition landscape as a whole?

1. Valuations May Soften: As software companies like Own face financial pressures, sky-high valuations are coming down (Own was valued at $3.35B in 2021, for example), making them more affordable targets for acquisitions by larger players.

2. Focus on the Tools: With macro trends like AI driving broad market effects, the tools in the background of these market trends are bound to benefit from the larger changes at bay.

3. Smaller, Strategic Acquisitions on the Rise: Large tech companies like Salesforce are likely to pursue more targeted, smaller acquisitions that enhance specific capabilities rather than massive, growth-driven buys. This could benefit startups with unique, high-value products, even if they haven’t achieved product-market fit yet themselves.

Salesforce's move signals a shift in the tech M&A landscape, where smaller, more strategic acquisitions may shape the future of the industry.

$22M for Chopsticks

Vancouver-based ChopValue has been making waves with its innovative approach to sustainability by turning over 176 million recycled chopsticks into furniture and housewares. Following a $3 million funding announcement last week, the company has now raised over $22 million in total. ChopValue operates 80 microfactories across nine countries, leading the way with a unique franchise model that could reshape the circular economy landscape.

Here’s a glance at ChopValue’s innovative franchise model:

1. ChopValue partners with local restaurants, offices, and other venues to collect used chopsticks, which are transformed into their products.

2. Each franchise operates a “microfactory,” a 2,500 to 4,000 sq ft local manufacturing unit designed to process waste materials into products, keeping operations highly decentralized and eco-friendly.

3. With 80 microfactories across nine countries, ChopValue's decentralized system is adaptable to regional waste challenges.

Our take? While we can’t comment on the quality of the products because we haven’t tried any of them for ourselves, we think this franchise model is absolutely brilliant. 

As global awareness of waste management and sustainability grows, the franchise-based circular economy could become a standard model for future green startups looking to address localized environmental challenges while scaling efficiently.

Kaleidoscope Focused: Key News

1. Macron names Michel Barnier as France’s new prime minister

2. Internet Archive loses court appeal in fight over online library

3. 7-Eleven owner rejects $38.7B buyout offer from rival

4. Google's AI-powered Ask Photos feature begins US rollout

5. Smartsheet ($7B market cap) set to be acquired by private equity firms

Curated Picks: Weekend Recs

Watch: Get in the mood for the start of the NFL season (or learn more about Taylor’s potential future brother-in-law) by watching the Kelce documentary on Prime Video

Read: As referenced in our podcast this week, The Anxious Generation: How the Great Rewiring of Childhood Is Causing an Epidemic of Mental Illness by NYU Stern Professor Jonathan Haidt

Listen: Fred Again’s new album ten days is out today

Grow the Collective

Some special surprises may be in store for our first referrers! 👀

Thanks for reading! Have a great weekend and we’ll be back on Monday. Stay tuned with us on socials @CoeusCollective.