Week of 19–26 October 2026 · AITech
This was the busiest AI week we’ve covered: more than 40 rounds, about a dozen acquisitions, and four new unicorns. One deal dwarfs the rest: DeepSeek’s roughly $15B, among the largest rounds ever raised in China. Everyone else together raised about $1.1B. Underneath the headline, two themes ran through the week. Investors are funding the infrastructure AI agents run on (sandboxes, code testing, data quality), and physical AI is now a funding category of its own, from robot “brains” to the data used to train them.
THE DIGEST
🇨🇳 DeepSeek raises about $15B
Bloomberg reports the Hangzhou lab raised about 100 billion yuan, increasing its target twice, from 50 billion to 80 billion yuan and then to the final figure. Battery maker CATL and Tencent were among the largest investors. The round came two days after the US ordered federal civilian agencies to remove DeepSeek’s technology from their systems. The company has hired Citic Securities to advise on a Shanghai IPO planned for early 2027.
🇺🇸 Tractian becomes a unicorn with a $130M Series D
Sapphire Ventures led the round, with M&G’s Catalyst as co-lead, valuing the Atlanta company at $1.4B. Tractian combines sensors with AI to predict when industrial machines will fail. More than 2,000 facilities use it, including factories and data centres. Its valuation has roughly doubled from $720M at its December 2024 Series C.
🇺🇸 Town raises $108M four months after launching
Forerunner and Menlo Ventures co-led the Series B, valuing Town at $1B, with a16z, Serena Ventures and First Round participating. Town gives every employee an AI assistant (a “Townie”) connected to their email, calendar and Slack. The assistants can now share information with each other and hand off work. Town was co-founded by former Plaid CTO Jean-Denis Greze, and has raised at least $160M in total.
🇺🇸 Dream Labs raises a $90M seed for a general-purpose robot “brain”
B Capital and Kindred Ventures led the round. The founders previously led NVIDIA’s GR00T robotics research. Their model, Dream-1, can control robots from different manufacturers without being retrained for each one. Dream Labs works with more than 20 hardware partners and sells access through an API, starting from $3 per robot-hour.
🇺🇸 Blacksmith becomes a unicorn two months after its last round
Sequoia led a $66M Series C at a $1B valuation, nearly double the $550M valuation of its August Series B. Blacksmith runs the automated tests code must pass before it ships, and AI coding tools have multiplied how much code needs testing. Since January, weekly test jobs on its platform have grown from 5 million to more than 90 million, and its annual recurring revenue has grown 17-fold. More than 10,000 companies use it.
🇭🇷🇺🇸 Daytona becomes Croatia’s third unicorn
FirstMark led a $60M Series B at a $1B valuation, with angels including Stripe’s Patrick Collison. Daytona provides “sandboxes”: isolated computers where AI agents can run code, browse and use software. It can set one up in 60 milliseconds. Customers include Anthropic, OpenAI, Nvidia, Meta and Cohere.
🇨🇳 Today AI raises more than $200M for a personal AI assistant
Investors include Ant Group, Tencent, Sequoia China and IDG Capital. Today AI builds an assistant that acts on users’ behalf without being asked, and has just made its first public launch in China.
Also raising this week:
- 🇺🇸 Watchtower Labs: $35M seed led by Shield Capital and Conviction, with Founders Fund, for AI that helps plan military logistics
- 🇺🇸 Mach9: $34M Series A co-led by First Round and Bessemer, after pivoting from surveying robots to AI drafting software for civil engineering
- 🇺🇸 Nirva: $33M for a $249 AI pendant that listens only to its wearer
- 🇺🇸 Maxinsights: $30M seed led by Peak XV, collecting real-world video data to train robots
- 🇺🇸 Tolan: $30M from USV and Khosla Ventures for an AI companion app with 250,000 monthly users and revenue in the tens of millions
- 🇬🇧 Circuit Mind: $18.5M Series A led by Norwest, for AI that designs circuit boards
- Others reported this week:
- Baba ($40M, Medicare)
- AuxoAI, Longeye and Firefly (about $20M each)
- Firstwork ($15M)
- Fragment ($12M, led by FirstMark)
- Azoma ($11.2M)
- Electric Plant Company ($11.2M)
- 🇩🇪 YGO (€8M, led by Ventech)
- 🇬🇧 Opply ($7.5M)
- Ailytics ($7.4M)
- Aries ($7M)
- Asymptote Labs ($5.5M)
- 🇫🇷 Reduck ($3M, led by Daphni)
- Vectorial ($3M)
- Weflayr ($2.5M)
EXITS & M&A
- 🇺🇸 OpenAI buys Orchestra Bio. Orchestra’s AI agents help drug developers track studies, timelines and delays. The team joins Rosalind, OpenAI’s life-sciences product, which Moderna and Novo Nordisk already use. Orchestra had raised about $20M from a16z, Atria and 8VC; terms weren’t disclosed.
- 🇮🇱 Boomi buys Elementary Data for about $40–45M in cash and stock. Elementary monitors the quality of the data that feeds AI agents. It’s Boomi’s third Israeli acquisition, after Rivery and Lunar.dev.
- Also reported: Kapital agreed to buy AI coding startup Woz for $30M; Rivian bought Third Dimension AI; Chapter bought Ridgeway; and Thomson Reuters bought a London legal AI startup before it had any revenue.
LAUNCHES
🇬🇧 Thore Graepel launches Metis Reasoning in London
Graepel, a co-creator of DeepMind’s AlphaGo, argues that large language models can’t be trusted to reason and that scaling them won’t fix it. Metis is building AI that keeps a checkable record of what it knows and how sure it is. It has a 12-person team and is reportedly raising tens of millions of dollars. It joins David Silver’s Ineffable Intelligence and Recursive Superintelligence in a growing cluster of new London AI labs.
THE ANALYSIS
1. A few companies are getting most of the money
DeepSeek’s $15B is about 14 times what every other AI startup raised this week combined. OpenAI is also reportedly in talks to raise $30B at about $1.4T. The labs building the largest models now raise money on a different scale from everyone else, and in China that money comes from strategic investors like CATL and Tencent.
2. Startups are reaching $1B valuations very fast
Town became a unicorn four months after launching, and Blacksmith doubled its valuation in two months. Investors are paying for revenue growth (Blacksmith’s revenue grew 17-fold, Daytona’s about 25-fold since January), but a valuation reached that quickly leaves little room for a slowdown.
3. AI agents need their own infrastructure
Daytona gives agents a computer to work in, Blacksmith tests the code they write, and Elementary checks the data they rely on. Asymptote, Weflayr and Reduck each build another piece. As AI shifts from producing text to taking actions, the less glamorous tools that keep agents safe and reliable are attracting serious money.
4. Physical AI is now its own funding category
Tractian, Dream Labs, Maxinsights, Firefly and China’s Gewu Tongzhi all raised money for AI that works with physical machines, and NEURA teamed up with Austria’s NXAI on robot memory. What’s scarce is good training data, and Maxinsights, which films people doing real-world tasks, shows that collecting that data is becoming a business of its own.
5. AI labs are buying their way into specific industries
OpenAI bought Orchestra Bio for drug development, and Anthropic bought confidential-computing startup Opaque Systems the week before. Rather than building every specialist product themselves, the major labs are acquiring small teams that already understand an industry.
6. Europe is betting on different approaches to AI
Metis is building an alternative to large language models, Daytona builds infrastructure for agents, and Circuit Mind applies AI to hardware design. European founders are mostly not trying to outspend US labs; they’re building different architectures, infrastructure and engineering tools.
Bottom line: Money concentrated at the top this week, with DeepSeek’s $15B round. Below that, investors backed infrastructure for AI agents and AI that works with machines. Four startups reached $1B valuations, several in months rather than years, so their growth will need to keep pace.
