PitchBook News - Supply chain tech funding weakens

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The Daily Pitch: VC

December 5, 2022

The Daily Pitch is powered by PitchBook’s industry-defining research and best-in-class data

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

Our latest Emerging Tech Research breaks down the decline in VC funding for supply chain tech, maps emerging opportunities and more.

Northzone's recruitment adviser for startups discusses the outlook on hiring and retention in a downturn.

Chart of the Day: Seed deal values continue to rise, from our PitchBook-NVCA Venture Monitor.

Today's Top Stories

VCs extend pullback from supply chain tech

VC funding for the supply chain tech industry continued to ebb in the third quarter, as pressures on the system eased somewhat amid waning demand. Startups around the world added $3.3 billion across 188 deals—representing a year-over-year decline of 77.2% and 55.7%, respectively.

Our latest Emerging Tech Research update explores VC trends in the supply chain space and highlights opportunities like blockchain technology and autonomous warehouse and delivery operations. The report also includes company spotlights on DLT Labs, Phantom Auto and Lumachain. Takeaways include:

While the number of exits in Q3 rose slightly quarter-over-quarter, overall exit value fell 59%.

Public listings dropped 73% year-to-date, but buyout activity ticked up.

Startups that offer technology for improving tracking and visibility in the supply chain—shortcomings exposed by the pandemic and recent geopolitical pressures—could see a tailwind.

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Q&A: Northzone on how to attract startup talent in a downturn

(Ink Drop/Shutterstock)

Attracting and retaining talent has been a major pain point for startups, and today's deteriorating market environment makes that task even more challenging.

We spoke with Elena Pantazi, a partner at London-based venture firm Northzone, about ways startups can manage employee recruitment and retention in the current economic climate.

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A message from DealCloud, by Intapp

Recession-driven opportunities remain for dealmakers amid market uncertainty

The Autumn 2022 edition of the Dealmaker Pulse Survey Report is live.

59% believe valuations in the coming 6 months will be lower than current levels
61% are concerned about overlooked or increased risk as a pricing obstacle
Yet 73% anticipate the same or higher volume of deal closings

Download a copy for more insights from private equity professionals on deal activity and fundraising, as well as data-driven analysis on the trends, factors, and challenges dealmakers may face in the months ahead.

Download the report

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Female founder dealmaking slump remains as year-end nears

(mapo_japan/Shutterstock)

Data from PitchBook's US VC Female Founders Dashboard shows that dealmaking is still in a slump, as startups with female founders end the year with a whimper.

Two months into Q4, such startups have completed 496 deals worth $4.8 billion, the fewest number of deals completed in this timespan since 2015.

Relative to the overall US VC market, it was a mixed bag: Female-only founded startups have garnered just 2% of all capital raised this year, the lowest share since 2016. Companies with both male and female founders, however, saw their share increase to 15.4%, a five-year high.

In November, healthcare services and systems companies raised the most money among female-only startups at $112 million, led by a $90 million round for digital health platform developer Maven.

Angel and seed stage deals have made up a larger-than-usual share of capital raised for female-only founded startups, representing roughly a quarter of capital raised in Q4 for those enterprises. This comes at the expense of early-stage VC deals, which made up only 32.7% of capital raised in that same time period, far less than its normal share.

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Fundraising funk hits up-and-coming firms hardest

Raising private capital became more difficult in Q3. Aggregate fundraising across the private investing universe was down 7.7% to $1.35 trillion in the 12 months leading up to Sept. 30, as only those funds focusing on venture capital and real assets managed to surpass year-ago levels.

But as some GPs—particularly emerging firms—get nervous, institutional investors have gained leverage in discussions around fund terms, DEI mandates and ESG data.

Our Q3 2022 Global Private Markets Fundraising Report (formerly known as the Global Private Fund Strategies Report) explains how each private strategy survived—or thrived—while fundraising this autumn. Key takeaways include:

November PE fund marketing rule changes from the SEC could add to the burdens of small GPs as they work to comply.

Investors are seeking safety in North America-based funds as they consider the strong dollar and distance from the war in Ukraine.

High inflation has spooked even real estate investors, whose commitments to funds declined 19% from the prior year through Q3.

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Quick Takes

	The Daily Benchmark
	2019 Vintage Global Real Estate Funds
	A message from RBC Capital Markets
	Activism is increasingly embedded into M&A strategy
	VC Deals
	Anduril secures $1.4B+
	Coatue, Dragoneer lead $140M UpStream Series B
	KreditBee raises $80M
	Healthtech startup ZOE pockets $31M
	Reach grabs $30M for wireless power
	Smoodi gets $5M
	Investors
	Patria Investments launches VC strategy

The Daily Benchmark

2019 Vintage Global Real Estate Funds

Median IRR

20.81%

Top Quartile IRR Hurdle Rate

35.05%

1.23x

Median TVPI

Select top performers

Banner Oak BOV

Lubert-Adler Workforce Housing Fund

Berkshire Multifamily Value Plus Fund V

*IRR: net of fees

61 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

A message from RBC Capital Markets

Activism is increasingly embedded into M&A strategy

Shareholder activism has returned after a pandemic lull. How will the rise of activist investors and universal proxies affect deal flow? How are corporate boards responding?

Get in-depth insights from RBC's expert bankers as they discuss topics and trends affecting the global M&A market on M&A Inflection Points, a limited podcast series.

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VC Deals

Anduril secures $1.4B+

Defense tech company Anduril, which is helmed by Oculus founder Palmer Luckey, closed a $1.48 billion Series E led by Valor Equity Partners. The round valued Anduril at $8.48 billion, up from $4.6 billion in June 2021.

View round

View 2 competitors »

Coatue, Dragoneer lead $140M UpStream Series B

UpStream Healthcare has received a $140 million Series B led by Coatue and Dragoneer Investment Group. Other investors included Avidity Partners, Define Ventures and Mubadala. The North Carolina-based company works with primary care physicians who treat Medicare patients.

View round

View similar company »

KreditBee raises $80M

Indian personal loan startup KreditBee has secured $80 million in a Series D backed by investors including Premji Invest, Motilal Oswal Alternates and NewQuest Capital Partners, TechCrunch reported.

View round

View 48 competitors »

Healthtech startup ZOE pockets $31M

Accomplice has led a £25 million (about $31 million) investment in London-based ZOE. The startup offers personalized nutrition programs.

View round

View 3 competitors »

Reach grabs $30M for wireless power

Reach has raised a $30 million Series B led by DCVC. The company said in a statement it is developing technology to deliver power wirelessly "over tens of meters."

View round

View 12 competitors »

Smoodi gets $5M

Robotic smoothie maker Smoodi has raised $5 million in Series A led by Keith Canning, TechCrunch reported.

View round

View similar company »

Don't miss our upcoming webinar

Join us for a webinar discussing key components of the difficult market landscape, including tightening credit and liquidity conditions, slowing growth and sharp increases in short-term interest rates, and how these impact PE.

PitchBook analysts Zane Carmean and Andrew Akers will discuss how rising debt costs combined with continued pullback in financing availability will be a significant headwind moving forward. Key topics include:

The window for an economic soft landing has narrowed. Our quantitative recession model predicts that recession odds have risen sharply in recent months.

While core inflation has slowed modestly in recent months, it has also broadened out into core services.

Although the US is not currently in a recession, growth drivers such as consumer spending and nonresidential business investment have slowed.

Register now to secure your spot.

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Investors

Patria Investments launches VC strategy

Latin American asset manager Patria Investments is getting into VC investing following the acquisition of Igah Ventures. Patria already operates private equity and growth equity strategies.

View details

View 107 investments »

Chart of the Day

Source: Q3 2022 PitchBook-NVCA Venture Monitor

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PitchBook News - Supply chain tech funding weakens

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