European venture capital firm Backed VC has successfully closed its third fund, Backed 3, reaching the $100 million cap. Concurrently, the firm celebrated its 100th investment milestone. Backed VC focuses on partnering with exceptional founders who are building transformational, generational businesses in frontier markets.

In the early stages of innovation, many companies are labeled as "tech startups" because they operate on the cutting edge of technology. Over time, technologies mature, becoming standard infrastructure rather than unique advantages. Many founders and investors struggle with this shift, holding on to outdated models that lead to misaligned expectations around funding, business valuation, and growth potential.

Historically, things like having a website, processing payments, SMS integrations, and GPS tracking were once complex technical feats that defined tech edges, but now have become baseline requirements or commoditized services. Uber’s early tech innovations exemplified what being a true tech startup meant, but newer ride-hailing services built on standard components are more tech-enabled operational businesses.

The fintech sector shows a similar divide between truly technical companies with proprietary data-driven models and firms whose tech is just a front-end on existing infrastructures.

The core insight: tech advantages have a half-life, transitioning from invention to commodity stages. Today’s frontier technologies like AI tools are following the same path—they will become standardized and lose their ability to differentiate.

Investors often fail by funding companies as if they are still in early-stage tech while these firms have moved into tech-enabled phases with fundamentally different risk and return profiles.

A simple test to distinguish the two is to assess how much of the business would work without proprietary tech and whether the core value can be replicated by SaaS solutions.

Being tech-enabled is not a disadvantage; many successful companies excel through operational excellence and sound economics, better suited for alternative financing rather than high-growth VC.

In summary, the difference between a tech startup and a tech-enabled company is crucial for founders and investors to recognize in order to align capital, expectations, and strategy with reality.

CoreWeave secured significant agreements with OpenAI and Nvidia, but delays in projects and a cautious future outlook caused its stock to decline sharply.

SoftBank has divested its entire stake in Nvidia to secure funding for substantial investments in OpenAI, reflecting a strategic shift amid growing AI market valuations and investor caution.

London-based digital safety startup FALKIN, which specializes in preventing scams before payments are made, has successfully raised $2 million in pre-seed funding. The round was led by TriplePoint Ventures and included participation from Notion Capital, supporting FALKIN’s mission to protect bank customers from AI-powered fraud.

Medicare has announced it will pay more than $1,000 for artificial intelligence to analyze heart scans, sparking debate over whether this cost is too high.

Japanese technology giant SoftBank Group Corp. announced it sold its stake in Nvidia for $5.8 billion in October, reflecting a strategic shift toward investing in artificial intelligence, particularly OpenAI. The company’s profit nearly tripled in the first half of the fiscal year, reaching about $13 billion (2.5 trillion yen), with sales increasing 7.7% year-on-year to $24 billion (3.7 trillion yen). SoftBank’s chairman Masayoshi Son is pivoting the company’s focus toward AI projects, including a major $500 billion initiative called Stargate alongside OpenAI, Oracle, and other partners. Nvidia, valued recently at $5 trillion, plans significant investments in AI infrastructure with OpenAI, strengthening its computing capabilities. Despite selling its Nvidia stake, SoftBank maintains strong ties through its investments in AI-related companies like Arm Holdings and Taiwan Semiconductor Manufacturing Co. SoftBank's stock has nearly doubled in the past year, while Nvidia’s shares experienced recent volatility. Overall, the move underlines SoftBank’s commitment to AI-driven growth strategies.

Rapid growth in startups often masks vulnerabilities beneath soaring metrics like MRR and expansion. As scaling introduces complexity—harder cash flow management, reactive hiring, and riskier investments—finance leaders play a critical role in establishing clarity, control, and consistency. Key to survival is treating financial discipline as a growth enabler rather than a constraint.

Financial visibility is foundational: startups must consolidate scattered data, manage cash flow vigilantly, and develop rolling forecasts to prepare for multiple scenarios. Understanding true growth drivers demands breaking down performance by segments and collaborating closely across sales, marketing, and product teams.

Sustainable success relies on customer retention, monitored through visible health metrics that prompt proactive interventions. Strategic investments require alignment of spending with measurable business outcomes, reinforced by continual reviews to ensure every dollar contributes effectively.

Talent data serves as a powerful predictive tool by linking hiring and performance insights, while aligning incentives with company goals fosters accountability and synchronized growth. Financial transformation can occur swiftly, typically within 60 days, by establishing clean data practices, consistent reporting, and embedding these processes into daily workflows.

Ultimately, startups that evolve their financial practices alongside their product growth achieve lasting strength, turning fragile foundations into resilient platforms for sustained success.

Julio Martínez is co-founder and CEO of Abacum, a financial planning and analysis software platform for mid-market firms. Under his leadership, Abacum has expanded globally, helping companies forecast revenue, plan headcount and cope with economic uncertainties.