Hi Synapticians!

Harvey AI has just pulled off one of the season’s quickest feats of financial wizardry: a $2 billion jump in market cap in only four months; without so much as tweaking its logo or slogan. The legal-tech up-and-comer has closed a $300 million round led by Kleiner Perkins and Coatue, pushing its valuation to $5 billion; about 67 times its estimated annualized revenue of $75 million. Fresh off a previous $300 million raise at a $3 billion valuation in January, the company shows how easily the market can mistake speed for wisdom.

Strip away the glitter and the numbers are modest: 337 clients and 340 employees, both of which management vows to double in short order. We’re dealing with software that automates contract review, not cold fusion; yet amid post-GPT euphoria, every boiler-plate clause seems to turn to gold. For perspective, Meta just pumped $14.3 billion into Scale AI for a 49 percent stake, valuing the data-labeling specialist at $29 billion—proof that bidding wars aren’t confined to law firms.

Our take? We’re witnessing a “reverse Robin Hood” effect: venture capital siphoning from the cautious to bankroll the over-eager. Yes, demand for legal AI exists; Reuters estimates 44 percent of tasks could be automated. But a valuation higher than all the legacy vendors in the sector combined looks more like a macro wager than a careful reading of the P&L. Should growth slow or regulators tighten data-privacy rules, these multiples may shatter like glass.

At this pace, even your non-compete clause ages more slowly than Harvey’s valuation.

Remember the timing: when funding dries up, only platforms that can widen their playing field; Harvey is already eyeing tax and audit; will survive the post-euphoria due-diligence gauntlet. As for the rest, the WeWork precedent is still available… free of charge.

Here’s the rest of the news about AI today:

• OpenAI and io's Ambitious AI Device Development

• AI Infrastructure: A Global Disparity Challenge

• Persona's Fight Against AI Hiring Fraud

Top AI news

1. Harvey AI's Valuation Soars to $5 Billion
Harvey AI, a legal automation startup, raised $300 million in Series E funding, boosting its valuation to $5 billion. The company plans to double its workforce to expand its AI solutions beyond legal services, including tax accounting. Harvey's rapid growth reflects the increasing demand for AI in professional services. Read online 🕶️

2. OpenAI and io's Ambitious AI Device Development
Court filings have unveiled OpenAI and io's efforts to develop a new AI device, despite ongoing trademark disputes with iyO. The filings indicate extensive research into in-ear devices, although the final product may differ. This development highlights OpenAI's ambition to innovate beyond traditional tech interfaces. Read online 🕶️

3. AI Infrastructure: A Global Disparity Challenge
A University of Oxford study highlights the concentration of AI infrastructure in just 32 countries, primarily benefiting the US, China, and the EU. Over 150 nations lack access to necessary computing power, exacerbating global inequality. Efforts by countries like India and Brazil to build local data centers may not suffice to meet demand, risking further disparity. Read online 🕶️

4. Persona's Fight Against AI Hiring Fraud
Persona has blocked 75 million deepfakes, showcasing the growing threat of AI-driven hiring fraud. Their advanced identity verification tools are crucial in combating this issue, especially as remote work becomes more prevalent. Read online 🕶️

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