PitchBook News - SPAC market's uncertain fate

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The Daily Pitch: VC

October 27, 2022

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In today's Daily Pitch, you'll find:

Our latest analyst note explores whether the death knell has sounded for the SPAC renaissance.

Nick Lawler, Churchill Asset Management's new head of secondaries operations, discusses how pricing and deal terms have changed.

Today's Top Stories

Lukewarm SPAC market's fate is intertwined with IPOs

It's clear now that modern reverse mergers between SPACs and low-revenue, high-growth companies are faring about the same as the IPO market: not well. That's largely due to the volatile public markets. PitchBook's VC-backed IPO and deSPAC indexes have each posted losses of more than 45% YTD.

But interest from shareholders has also waned as they seek to de-risk their portfolios, and that sentiment led only 35 new SPAC vehicles to list on public exchanges during the third quarter. Our latest analyst note explores whether the dropping activity levels in Q3 may have sounded the death knell for the SPAC renaissance.

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Top 10 VC deals of the DACH region so far in 2022

Berlin's Brandenburg Gate (Thorsten Frisch/Shutterstock)

The number of VC mega-rounds in the DACH region—which includes Germany, Austria, Switzerland and Liechtenstein—has fallen this year as the economic downturn puts pressure on dealmaking.

However, a handful of startups have secured outsized rounds, with two even surpassing the €1 billion mark. We've rounded up which companies have raised the most so far.

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A message from Orrick

VC-backed life sciences companies face a more difficult market

Orrick's Life Sciences Snapshot explores venture capital trends in the life sciences industry in Q3. Top findings include a continued drop in deal value to pre-pandemic levels in Q3 but more elevated deal value on an annual basis so far in 2022. Mixed changes in deal sizes and pre-money valuations took shape for late-stage companies, which are more likely to be impacted by the strained IPO environment. The report includes further analysis of dealmaking and exit trends for various company stages and sizes.

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Q&A: Churchill's Nick Lawler on the secondaries market slowdown

(treety/Shutterstock)

Last year's strong dealmaking momentum in the secondary markets persisted into the first half of 2022, with buyers deploying capital at a fast clip.

However, the liquidity in this market has been shrinking due to fundraising challenges. Meanwhile, secondary investors are becoming more selective amid the market volatility. For the rest of the year, deal volume is expected to slow, making the total tally lower than last year's highs, and the market is putting power back in the hands of buyers who can request better deal terms.

PitchBook recently spoke with Nick Lawler, Churchill Asset Management's new head of secondaries operations, about how pricing and deal terms have changed in recent months and how the team is approaching opportunities in today's market.

Recommended Reads

Family offices have gotten opportunistic amid the market chaos, showing interest in distressed hospitality, digital assets, lithium and even Ukrainian tech companies. [Institutional Investor]

The Carlyle Group is searching for a new CEO. Here's a look at some candidates. [Fortune]

Across the country, people are struggling to fill their prescriptions for Adderall, and this deficit could turn deadly. [Wired]

Since yesterday, the PitchBook Platform added:

6

VC valuations

720

People

273

Companies

23

Funds

See what our data software can do

Quick Takes

	The Daily Benchmark
	2015 Vintage Global VC Funds
	VC Deals
	Ascend Elements raises $300M in equity and debt
	Trigo banks $100M to develop autonomous checkout technology
	M12 leads $25M Series A for Valence Security
	EV battery startup Ionblox nabs $24M
	Unito picks up $20M

The Daily Benchmark

2015 Vintage Global VC Funds

Median IRR

24.35%

Top Quartile IRR

37.70%

2.29x

Median TVPI

Select top performers

Index Ventures Growth III

Outlander 1 Archimedes

360 Square

*IRR: net of fees

72 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Ascend Elements raises $300M in equity and debt

Ascend Elements has raised $300 million, including a $200 million Series C round led by Fifth Wall Climate. The company is a developer of battery technology designed to recycle old cathode materials.

View round

View 2 competitors »

Trigo banks $100M to develop autonomous checkout technology

Trigo has raised $100 million in a round co-led by Temasek and 83North, Reuters reported. Based in Tel Aviv, the company is a developer of checkout technology designed to track customer movement and product choices using ceiling-mounted cameras.

View round

View 21 competitors »

M12 leads $25M Series A for Valence Security

Valence Security has raised a $25 million Series A led by M12. The company develops an infrastructure platform for SaaS security applications.

View round

View similar company »

EV battery startup Ionblox nabs $24M

Ionblox, formerly known as Zenlabs Energy, has raised a $24 million Series B from investors including Lilium, Applied Ventures and Catalus Capital. Founded in 2017, the company is a developer of lithium-ion technology for electric vehicles.

View round

View 3 competitors »

Unito picks up $20M

Unito has raised $20 million in a round led by CDPQ, with support from investors including Rainfall Ventures and Bessemer Venture Partners. Based in Montreal, the company is a developer of workflow management software intended to integrate information across apps like Asana, GitHub, Salesforce and Trello.

View round

View 87 competitors »

Don't miss our upcoming webinar

With the end of 2022 approaching, the differences in the VC market from this year to last continue to come into focus.

In this webinar, our speakers will explore the lost momentum of 2022, as well as the inverse dynamic between deal sizes and deal count. They will analyze the factors that contributed to this decline and whether current market conditions will continue or revert.

Register now to secure your spot.

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Chart of the Day

Source: PitchBook's Q3 2022 Global M&A Report

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PitchBook News - SPAC market's uncertain fate

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