Big Tech companies have been slashing headcounts over the past couple of years — and startups are also stretching their venture dollars by hiring less, according to data from Carta.

Why it matters: Stockpiling software engineers was a phenomenon of the zero-interest rate era — for big and small companies alike.

The big picture: At the same time, median early-stage deal size has grown, according to PitchBook data, further supporting the idea that companies are doing more with less.

By the numbers:

• Startups that raised seed funding in the first half of 2024 had an average of 5.3 employees, down from 6.9 three years ago.
• Startups that raised a Series A round in the first half of the year had an average of 15.6 employees, down from 17.6 in the first half of 2021. Series C startups followed a similar pattern.
• The outlier was Series B startups, which have slightly bigger teams on average than they did three years ago.

Zoom out: While January of this year stayed on trend as a big hiring month, the 27,677 new hires is 29% less than the previous January.

• Carta also notes it saw the fewest new January hires so far this decade.

Bonus data: Startups also seem to be pulling back from an earlier pivot toward more geographically distributed teams.

• In-state hiring at startups valued between $1 million and $10 million dropped from 67% in 2019 to 45% in 2023. However, that's started to tick back up, according to Carta.
• Same trend with those valued between $10 million and $50 million and the larger ones above $500 million.
• The startups in the middle ground, however, continued to hire more out of state this year.

The bottom line: This shouldn't be surprising given the venture market's continued tightness, and relative uncertainty about what lies ahead. Companies want to make their resources last for as long as possible.

BNP Paribas is in exclusive talks to acquire AXA Investment Managers for €5.1 billion ($5.5 billion).

Why it's the BFD: The deal would create one of Europe's largest money managers, with roughly €1.5 trillion in assets under management.

The bottom line: "The purchase is the biggest yet for the BNP CEO, who until now shied away from big takeovers, deciding instead to return excess cash to shareholders after selling US lender Bank of the West for $16.3 billion last year. The proposed deal would allow BNP to challenge Europe's No. 1, Amundi SA, although it would still be dwarfed by US firms such as BlackRock Inc. or Vanguard Group Inc." — Alexandre Rajbhandari, Pamela Barbaglia, and Jan-Henrik Foerster, Bloomberg

• Bilt Rewards, a N.Y. credit card startup, raised $150m in additional funding led by Ontario Teachers' Pension Plan, with Vanderbilt University Endowment, the University of Illinois Foundation and others also participating. axios.link/4frmqoT

• Agrovision, an L.A. superfruit producer, raised $100m in funding at a $1b valuation from Aliment Capital, and Steve Kaplan. agrovisioncorp.com

• Contextual AI, a Mountain View, Calif., enterprise AI company, raised $80m in Series A funding led by Greycroft, with Bain Capital Ventures, Lightspeed, Lip-Bu Tan, Conviction, Recall Capital, Bezos Expeditions, NVentures, HSBC Ventures, and Snowflake Ventures also participating. contextual.ai

• Protect AI, a Seattle AI and machine learning security company, $60m in Series B funding led by Evolution Equity Partners, with 01 Advisors, StepStone Group, Samsung, Acrew Capital, boldstart ventures, Knollwood Capital, Pelion Ventures, and Salesforce Ventures also participating. axios.link/3SxVRnX

• Morpho, a French crypto lending startup, raised $50m via a token sale led by Ribbit Capital, with Andreessen Horowitz, Coinbase Ventures, Variant, Pantera, Brevan Howard, BlockTower Capital, and Kraken Ventures also participating. axios.link/3yzJ6Cy

• LeafAgriculture, an L.A. farm data management startup, raised $11.3m in funding led by Spero Ventures, with Cultivian, Radicle Growth, and SP Ventures also participating. axios.link/3WwwC6F

• Hedra, generative AI startup, raised $10m in seed from Index Ventures, Abstract, and A16Z Speedrun. axios.link/3YtiRsg

• Bourgeois Boheme, a Lithuanian finance management and lifestyle services startup, raised $7m in seed funding led by Graphit Lifestyle was the deal lead. axios.link/3SAd0NR

• Lovetovisit, a U.K. family-friendly travel startup, raised €3.2m in funding led by Venrex and Redrice Ventures, with Active Partners, Velocity Partners and angel investors also participating. axios.link/3A6YSoZ

🚑 Berkshire Partners and Leonard Green & Partners invested in Vital Care, a Brentwood, Tenn., franchisor of infusion therapy pharmacies. vitalcare.com

• BharCap Partners invested in Electronic Merchant Systems, a Cleveland-based merchant payments company. emscorporate.com

• Crédit Agricole Assurances agreed to acquire a minority stake in Océinde Communications, a French telecom company, from ICG Infrastructure Equity. ca-assurances.com

• GrowthCurve Capital invested in PureFacts, a Canadian revenue management software company. purefacts.com

• Mainsail Partners invested $44m in INNERGY, a Sauk Rapids, Minn., provider of cloud-based software for woodworking, cabinetry, stone, metal, and other engineer-to-order shops. innergy.com

• PSC Group, backed by TJC, acquired Delta Petroleum, a filling and logistics services, from Greif. pscgroup.com

🚑 TowerBrook Capital Partners and Clayton, Dubilier & Rice will acquire R1 RCM (Nasdaq: RCM), a Murray, Utah health care company, in a deal worth $8.9b. axios.link/3WNhK5r

🚑 WellSpring Consumer Healthcare, backed by Avista Healthcare Partners, acquired vH essentials, a women's hygiene company, from Wisconsin Pharmacal Co. wellspringpharm.com

• Ya Ya Foods, backed by Entrepreneurial Equity Partners, acquired Truss Beverage, a Canadian beverage manufacturing company. yayafoods.com

• Cerebras, a Sunnyvale, Calif., AI chip company, has confidentially filed for an IPO. axios.link/3Wtt858

🚑 Drugs Made In America Acquisition, a SPAC targeting U.S. pharmaceutical businesses, filed for a $500m IPO. axios.link/4dpClC5

• ITT (NYSE: ITT) agreed to acquire kSARIA Holdings, a Hudson, N.H., aerospace and defense supplier, from Behrman Capital for about $475 million. ksaria.com

🚑 23andMe (Nasdaq: ME), a South SF genetic testing company, rejected CEO Anne Wojcicki's offer to acquire the company for $0.40 a share. axios.link/4fvQvUo

• Caesars Entertainment agreed to sell its World Series of Poker brand to NSUS Group for $500m, half in cash and half via promissory note due in five years. axios.link/3LPtwGc

• NLX acquired Radish Systems, a Boulder, Colo., call technology company. nlx.ai

• Quinbrook Infrastructure Partners, a specialist global investment manager focused exclusively on the infrastructure needed for the energy transition, raised $3b for its fifth energy transition-focused fund. quinbrook.com

🚑 venBio, an SF venture firm focused on biotech, raised $528m for its fifth fund. axios.link/3A98b7W

• Atar Capital, an L.A. private investment firm, hired Nick Polanski as a director in operations. atarcapital.com

• Ballistic Ventures, an SF cybersecurity venture firm, hired retired Gen. Paul Nakasone as a strategic adviser. axios.link/4ccs77l

• Bessemer Venture Partners, an SF venture firm, promoted Anurag Begwani to vice president. bvp.com

• Carlyle's Marco De Benedetti and Jonathan Zafrani, are stepping down from leadership roles in its Europe buyout unit. axios.link/4c9WVp5

• Edgar Matthews & Co., an N.Y. investment bank, hired Federico Chapto as a managing director, and Hamadi Benmustapha as a principal. edgarmatthews.com

• Federated Hermes, a U.K. investment firm, promoted Brooks Harrington as CIO of private equity. axios.link/3LQVBwS

• Northzone, a U.K. venture firm, promoted Molly Alter to partner. axios.link/3A9z23I

• Visionaries Club, a German venture firm, hired Katy Sexton as VP of communications, and Betty Lu as chief of staff. visionaries.vc

Big Tech's message to investors on back-to-back earnings calls this week was "Stop worrying about the billions we're spending on AI — everything's going to be just great."

The big picture: Over the past month, Wall Street began questioning the growing cost of buying high-end chips and building data centers, asking when these investments would start to show up in revenue and profit growth, according to my colleague Scott Rosenberg.

• Google, Microsoft and Meta, each in different ways, told Wall Street to relax.

By the numbers: These companies all continue to grow and remain jaw-droppingly profitable, providing an enviable financial foundation for their most ambitious dreams.

• Last week, Google parent Alphabet reported $24 billion net profit on $85 billion revenue.
• On Tuesday Microsoft reported $22 billion net profit on $65 billion revenue.
• On Wednesday Meta reported $13.5 billion net profit on $39 billion revenue.
• On Thursday Apple reported $21 billion net profit on $86 billion revenue.
• The same day, Amazon reported $13.5 billion net profit on $148 billion revenue.

The bottom line: "When you go through a curve like this, the risk of underinvesting is dramatically greater than the risk of overinvesting for us here," Google CEO Sundar Pichai told analysts last week.