PitchBook News - How alternative assets are stacking up

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The Daily Pitch: VC

February 8, 2023

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 Quantitative Perspectives report offers a bird's-eye view of US alternative markets.

Our latest Emerging Tech Research update explores agtech's difficult harvest in Q4 2022.

Catch up on the state of SoftBank's Vision Fund with our dashboard.

Today's Top Stories

How alternative assets are stacking up amid US recession fears

An expanding US economy in H2 2022 was met with geopolitical strife, hawkish central banks and a growth hangover, to say the least. But alternative asset investing churned on.

Through the tumult of last year, private market AUM dipped, according to PitchBook projections. Our latest Quantitative Perspectives report, with 70-plus pages of insights into the US private markets, uses our capital recycling framework to predict where that growth will lead in the short and long term. Key takeaways include:

We forecast that private market AUM will shrink in 2023, then rebound over a four-year period, sliding into 2027 with $13 trillion under management in VC, PE, private debt, real estate and real assets.

Our recession model continues to predict a downturn is more likely than not, and if the Fed can thread the needle, a soft landing is possible.

VC funds should gain more bargaining power while negotiating term sheets. Startups' demand for new capital has climbed dramatically—virtually doubling to $80 billion in two years—so they will have to work harder to attract capital.

read the report

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Digging into agtech's Q4 harvest

Agtech had a bad harvest in Q4 2022, despite a boom over the past few years. Volatile markets and rising interest rates put a damper on the segment.

So what, if anything, can be salvaged from agtech's Q4? Our latest Emerging Tech Research update explores deals, figures and developments in the space. Key takeaways include:

VC funding for agtech was down 13.2% year-over-year, at $10.6 billion. Despite this, 2022 was the second-best year on record.

Q4 saw startups raise $1.8 billion, down 34.1% compared to the previous quarter.

Exit activity plummeted 93% compared to 2021, amid a difficult global market environment.

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A message from West Monroe

2023 Outlook: The Future of the Private Equity Industry

Private equity has experienced years of high deal volume and sky-high valuations. But as rising interest rates, inflation and threats of a recession continue to impact the economy, the future of private equity is in flux as firms are forced to compete more aggressively for good deals—or to find ways to ratchet up the value of the struggling companies they're able to snatch up at a bargain. With this increased pressure, private equity firms should be looking at how leveraging data and industry trends can continue to redefine the deal process to be faster and more impactful—and what to do with the insights that data provides to come out on top in 2023.

Click here to learn more

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SoftBank's Vision Fund records $5.6B loss

(Michael Vi/Shutterstock)

SoftBank's Vision Fund is in a funk with four straight quarters of losses. Once known for its aggressive and large bets, the fund has slowed investments by a stunning 98%, with its founder Masayoshi Son stepping away from the wheel.

Catch up on the state of the Vision Fund with our dashboard.

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Chinese PE crowds into chip industry as export restrictions grow

(Gorodenkoff/Shutterstock)

The Netherlands and Japan announced plans this week to join the US in restricting semiconductor exports to China. As Beijing looks to bolster domestic chip manufacturing, private equity investors in China pumped $10.12 billion into the global semiconductor industry in 2022—with the bulk going into firms in the Greater China region—a new record.

Recommended Reads

Clouds are a big barrier to harnessing consistent solar power. So, why not put the solar panels in space? [Wired]

CIOs at KKR, Nuveen and Bridgewater Associates share their biggest concerns about the future of global markets. [Bloomberg]

AI is increasingly being used in the job interview process. But, how do you impress an algorithm? [Harvard Business Review]

Since yesterday, the PitchBook Platform added:

14

VC valuations

2314

People

634

Companies

27

Funds

See what our data software can do

Quick Takes

	The Daily Benchmark
	2012 Vintage North American PE Funds
	Portfolio Companies
	Penske Media to stake Vox Media
	Exit & IPOs
	Shore sells medical supplies specialist
	Epiris looks to exit Bonhams
	Fundraising
	Goldman Sachs closes $5.2B growth fund
	Partech wraps up $263M Africa-focused fund
	Hanover raises $181M

The Daily Benchmark

2012 Vintage North American PE Funds

Median IRR

16.26%

Top Quartile IRR

23.90%

1.78x

Median TVPI

Select top performers

MTS Health Investors III

Eureka III

Clearlake Capital Partners III

*IRR: net of fees

81 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Jobber, which offers operations management software, has raised a $100 million Series D led by General Atlantic. Summit Partners, Version One Ventures and Tech Pioneers Fund also participated.

Atmosphere, which provides a streaming TV service for businesses, has raised $65 million at a $1 billion valuation in a Series D led by Sageview Capital, Valor Equity Partners and S3 Ventures.

Biotech startup Garuda Therapeutics has raised a $62 million Series B led by Northpond Ventures, OrbiMed Advisors, Cormorant Asset Management and Aisling Capital.

Aerial data startup DroneBase has raised $55 million and rebranded itself as Zeitview. Valor Equity Partners led the round.

Ushur, a startup using AI for customer experience automation, has secured a $50 million Series C led by Third Point Ventures.

OCD treatment provider NOCD has raised a $33 million Series B led by F-Prime Capital.

Canadian fintech startup Conquest Planning has secured roughly $18 million in a Series A led by Fidelity International Strategic Ventures.

TILT Biotherapeutics has raised a €22 million round led by Lifeline Ventures. The Helsinki-based startup develops immunotherapies for cancer treatment.

Build38, which offers security solutions for mobile apps, has raised a €13 million Series A led by Tikehau Capital.

Modvion, which makes wooden wind turbine towers, has raised 125 million Swedish kronor (about $11.8 million) from investors including Almi Invest, Course Corrected VC and Symbia VC.

Yamaha Motor has led a €7 million Series A for Skipperi. The startup offers a boating subscription service and peer-to-peer boat rental platform.

Netherlands-based Vev has raised €5 million from Notion Capital and Point Nine Capital. The startup's software helps entrepreneurs launch their businesses.

Don't miss our upcoming webinar

The 2022 VC market struggled to match up with 2021 on multiple fronts. In particular, Q4 proved to be a low point in exits and liquidity yet contributed to a strong annual performance in fundraising and early-stage deals. Our webinar features PitchBook analyst Max Navas and industry experts from NVCA, Insperity, J.P. Morgan, and Dentons discussing the current VC landscape and what to expect in 2023. Key topics include:

A record-setting performance for annual raised capital, the second consecutive year exceeding $150 billion.

The continued decline in exit activity that resulted in the first dip below $100 billion since 2016.

The contribution of micro-funds and nontraditional investors to the growth of seed-stage deal sizes and pre-money valuations.

Register now to secure your spot.

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PE Deals

Amulet Capital Partners has acquired Eruptr, a digital marketing agency for the healthcare industry. Athyrium Capital Management invested alongside Amulet.

Equistone-backed Dutch precision mechanical components maker Andra Tech has acquired peer DKH Metaalbewerking.

JC Flowers-backed Solomon Capital Holdings has acquired a minority stake in UK-based independent financial adviser Beaufort Financial Westerham.

Omni Partners has acquired medical device manufacturer Aesthetic Technology.

Mountaingate Capital has invested in Ignite Visibility, a digital marketing agency.

Portfolio Companies

Penske Media to stake Vox Media

Vox Media is raising $100 million from Penske Media, a trade publication specialist that counts Rolling Stone among its holdings, The New York Times reported. Penske would reportedly own about 20% of the digital publishing company after the investment.

View details

View 20 competitors »

Exit & IPOs

Shore sells medical supplies specialist

Shore Capital Partners has sold Argentum Medical, which makes wound care products, to Mountaingate Capital's BioDerm.

View details

View 16 competitors »

Epiris looks to exit Bonhams

Epiris is looking to sell UK auction house Bonhams, Bloomberg reported. The firm is said to have hired JP Morgan to seek out potential buyers.

View details

View 3 competitors »

Fundraising

Goldman Sachs closes $5.2B growth fund

Goldman Sachs Asset Management has closed a growth-equity fund on $5.2 billion, which makes it one of the largest funds of its kind, according to the firm. The vehicle will target high-growth businesses with an average ticket size of $50 million.

View details

View 1,394 investments »

Partech wraps up $263M Africa-focused fund

VC firm Partech has closed its second fund dedicated to startups in Africa, TechCrunch reported. Partech raised roughly $263 million for the vehicle, which will focus on early- and growth-stage startups.

View fund

View 403 investments »

Hanover raises $181M

London-based Hanover Investors has raised £150 million (about $181 million) for its most recent fund. The vehicle will acquire small-cap companies and has a target of £300 million.

View fund

View 24 investments »

Chart of the Day

"Comparing the mix of exit types (acquisition versus public listing) between the patent set and nonpatent set shows a share of patent companies exiting via the public markets that is more than five times greater than the share of nonpatent companies exiting via the public markets."

Source: Introducing PitchBook Patent Research

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PitchBook News - How alternative assets are stacking up

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