Comment by LeonM
1 day ago
The title makes it sound like they just did a seed round, but the seed round was announced in August of last year [0].
Their website landing page is now also showing the software is no longer maintained. No mention of why they made this decision, my best guess is they burned through their seed money and were unable to attract further investments.
[0]: https://www.tensorzero.com/blog/tensorzero-raises-7-3m-seed-...
The company was started in January 2024, so the seed financing is likely a roll-up of two years of fundraising. $7m for ~30 months of running an AI startup in NYC is not that unusual.
Burning through $7m in 9 months? That's an impressive amount of avocado toast.
$7m actually isn't a whole lot, especially if they hired a (larger) engineering team. Assuming their cali based, that's easily 150-200k per engineer, a team of 20 easily eats through that. Idk the specifics, but I don't the organization was fradulent, it could also be that they're going commercial and no longer want to maintain their oss stack
150-200k is also just the employee’s salary, the actual cost to the company is significantly higher, you need to multiply that by something like 1.5 to get the fully loaded cost, people are expensive!
20 engineers would be incredibly aggressive growth for such a young company with that amount of capital, no?
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Tokenmaxxing makes startups even leakier if they don't find token traction.
if you hire 20 engineers with your seed round you are either very confident you'll be able to use them to justify another raise soon
or you're incompetent
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I thought ai was writing all the code. What do they need engineers for?
We raised in 2024 and only burned through ~$3m of it, mostly on salaries to support a small team.
And AI tokens
That would be a lot still. That’s a lot of money.
I’d bet on extreme irresponsibility.
And poached eggs.
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Those Claude tokens are not cheap you know /s
thanks, that was really confusing me!
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Were the thousands of commits and hundreds of feature branches over the last 9 months just to keep up appearances, then? Were the 850 people who forked it in on the scheme, too?
Well.. if that's it it's not really much to shown for if you spent $7 million on it.
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Did Claude make the commits and branches?
(Honestly I don’t think so here, but I predict that will happen eventually)
Sometimes things just fail.
Do you understand that when you raise money it doesn't go into your personal account? Its not like you can move this money in your retirement account and sail into the sunset.
You can call it a bait but where is VCs due diligence for this. Most VCs where out there defending their infra layers investment. Just look at YC batches and see the inflated number of infra startups.
Right? I’ve been through due diligence and it’s neither a quick nor simple process, even for seed.
A great way to launder money then?
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"Failure" is the expected median though. You can't due-diligence your way out of "startup ran out of runway"!
The discussion here isn't about funding, it's that there's a presumptively useful community tool which got abandoned because its owners took their toys and went home when the money ran out (instead of making a sincere effort at transitioning to community governance). That's on the IP owners being selfish jerks and/or grifting losers. It's not the VC's fault.
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