Icehouse Ventures Seed Fund IV crosses $70m
Plus: Google may finally be snatching back its crown
Happy Thursday!
This is the day we typically go around the world for global startup / tech news (and don’t worry we have some of that still) but we simply couldn’t pass up the opportunity to headline this newsletter by shouting out a record-breaking Seed Fund update from the team at Icehouse Ventures. That’s the engine which will power the next generation of super star startups right there.
Here’s what’s brewing in your Daily Shot:
Icehouse Ventures raising largest Seed Fund in NZ history
Google may finally be snatching back its crown
Pod Pick: First Block with Decagon co-founder, Jesse Zhang
Altman and Ive give new details of their iPhone killer
As always, thank you to everyone who has upgraded to a paid subscription or simply recommended Caffeine to friends and whānau. We couldn’t do any of this without you.
Finn and the CAFFEINE team
Icehouse Ventures raising largest Seed Fund in NZ history: We covered the open of this fund back when it was eyeing ‘just’ $30m but our friends over a Icehouse Ventures have absolutely smashed that goal and are closing in on the biggest seed fund in NZ history. Seed Fund IV has already secured nearly $70m of capital from 363 investors to fund the growth of New Zealand’s best early-stage startups.
There is now a $75m hard cap and New Year’s Eve close but a the current rate it could close well before that. $6.3m from Seed Fund IV has already been committed to eight NZ-founded startups and is expected to invest in more than 40 Kiwi startups across the early-stage spectrum, from founding team to pre-Series A over a three year period.
The early investments include some familiar names to the Caffeine audience, like AI presentation creator, Aether and design collaboration platform, Harth. There’s some new names in there too who are sill in stealth, like industrial engineering software, Spaceproof, and fraud-prevention technology startup, Static Technologies.
The support of this fund also reflects investors recycling returns generated by earlier funds. Those who invested in Seed Fund 1 have seen more than 2x returned and the remaining holding is worth 5.7x.
IHV CEO Robbie Paul says this record breaking fund shows the startup ecosystem is back in motion.
“The rise of the ecosystem was inevitable because entrepreneurs build businesses over time horizons that far exceed presidential terms and macro-economic swings. Nonetheless, the last few years have seen most investors shy away from early-stage venture investing. The success of Seed Fund IV demonstrates a renewed belief in Kiwi entrepreneurs.”
Google may finally be snatching back its crown: It’s always been perplexing to me that Google wasn’t more dominant in the AI arms race out of the gates. With its incredible delivery mechanism for AI products across its range of services, deep reservoirs of cash on hand and one of the greatest AI labs already set up before others were ever saying AGI in public. With the release of Gemini 3 last week, the company turned heads and now, as one Fortune headline memorably put it, ‘The sleeping giant is fully awake’.
One reason getting fewer headlines that Gemini is that Alphabet (he parent company) is also pulling ahead in the chips race. Nvidia and is GPUs have been seen as the only game in town for a long time but after unveiling its next generation specialised AI TPUs last week, Google signed a multi billion dollar deal with Anthropic and is reportedly in talks with Meta for another mega deal. It also helps that Google recently had a win on the legal front, with a judge ruling out the most punitive measures in a monopoly case, meaning Google didn’t have to spin out its search function.
Overall it seems like Google, after being put on he backfoot by the upstart OpenAI, took its time to gather its considerable strength for this battle and is now taking swings. I think this can only be good for the consumer, as one clearly dominant product in the category doesn’t exactly spark innovation but I am sure it’s not great for Sam Altman’s blood pressure.
Pod Pick: First Block with Decagon co-founder, Jesse Zhang - Our friends over at Notion have an exceptional podcast series called ‘First Block’ where founders from the world’s leading companies tell us about the many “firsts” of their startup journeys.
In this episode, they spoke with Jesse Zhang, Co-founder and CEO of Decagon. In just a year since coming out of stealth, Decagon has become a $1.5 billion AI unicorn, transforming customer service for companies with AI agents that achieve 70-80% deflection rates and 3x customer satisfaction improvements.
The TL;DR advice from the podcast via Notion
Optimize for execution speed early, then shift to long-term thinking: Jesse focused Decagon purely on short-term execution and customer deployment for the first 18 months, avoiding distractions about long-term product vision. This speed-first approach helped them scale from stealth to unicorn status in a year.
Don’t over-index on advice—understand your own strengths and timing: Jesse learned from his first company that following others’ playbooks is deeply distracting. The key is understanding what works specifically for you rather than applying generic “best practices.”
Early team composition determines everything that follows: The first hires set the trajectory for all future hiring. Jesse prioritized senior generalists from his network in the early days, which created a strong foundation that attracted subsequent talent as they grew from 12 to 200 in 18 months.
Altman and Ive give new details of their iPhone killer: Off the back of he news above, is fitting we check in on the play which might reverse. iPhone designer Jonny Ive and OpenAI have been cooking up a mystery device for a while now and we finally got some more details. Well, we got some more vague vibes about how they want the device ‘ feel’ but we did hear it should be out within two years.
Speaking at EC Demo Day the pair explained how they wanted their new device to be simple, elegant and almost anticlimactic to people first getting their hands on it. Altman says the iPhone is clearly a marvel but likened using a smartphone in 2025 to ‘walking through Time Square’ and constantly being bombarded with demands on our attention. He wants something which is a much more invisible presence in your life which allows you to focus on more important things. It’s a lovely idea but still am not convinced that most consumers are not yet ready to go screenless.
That’s it for today, thanks for reading. Want to get in touch with a news tip, bit of feedback or just to chat? Email hello@caffeinedaily.co
The Google piece caught my eye. Its wild to think they were on the backfoot for so long given all their resourcs and AI talent. Them signing deals with Anthropic on their TPUs while competing with OpenAI is such an interesting play, almost like playing both sides of the board. Makes me curious if this signals a bigger shift toward in house chips across big tech.