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The Daily Pitch: VC

February 13, 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 latest analyst note maps the road ahead for the US private markets—and explores the potential for a recession.

A look back on crypto investors' stormy journey in our latest Emerging Tech Research.

Smaller PE firms have carved out niches such as sports media and entertainment to secure commitments.

Today's Top Stories

Do all roads lead to a recession?

While public market struggles carried the headlines last year, market pricing told a different story.

PitchBook analysts believe rising discount rates, rather than lower growth expectations or higher risk premiums, were responsible for most of the public market's woes in 2022. But what do these mixed messages mean for the likelihood of a recession?

Our latest analyst note breaks down recent economic and public market developments that have shaped the outlook for the US private markets, examines the key risks and opportunities investors are facing, and lays out the potential roads forward—many of which would lead to a recession.

read it now

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Investor appetite, micro-funds help seed investing defy startup drubbing

(Andey_Popov/Shutterstock)

2022 was a record year for seed investments. Meanwhile, deal activity at the late stage slowed down sharply.

The bifurcation displays investor sentiment about two widely accepted concepts: Mature startups are the most vulnerable to volatility in the public markets, and the best companies are built when capital is scarce.

Recommended Reads

Thousands of fintech jobs are gone as companies cut costs for the first time. [Bloomberg]

The SEC is probing an investment firm owned by the Mormon Church for holding back disclosures on a portfolio of a size comparable to some of the biggest sovereign wealth funds. [The Wall Street Journal]

Competition, government incentives and falling raw material prices are making battery-powered cars more affordable, sooner than expected. [The New York Times]

Since yesterday, the PitchBook Platform added:

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Quick Takes

	The Daily Benchmark
	2011 Vintage North American Funds-of-Funds
	Exit & IPOs
	Tikehau seals EuroGroup Laminations IPO
	Fundraising
	EQT sets sights on $22B+ infrastructure fund
	Sound Ventures targets $200M AI fund
	Corporate M&A
	Kotak Mahindra eyes $65M+ microfinancing deal

The Daily Benchmark

2011 Vintage North American Funds-of-Funds

Median IRR

17.15%

Top Quartile IRR

21.93%

2.20x

Median TVPI

Select top performers

Venture Investment Associates VII

Weathergage Capital Investments A

SVB Strategic Investors Fund V

*IRR: net of fees

47 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Sam Altman, founder of OpenAI, is in talks to raise up to $120 million from several sovereign wealth funds for Worldcoin, his new eyeball-scanning crypto startup, The Block reported.

Cirba Solutions, a battery materials management and processor company, has raised $50 million in a round led by the Marubeni Corp.

Inscribe, which offers a risk intelligence platform, has secured a $25 million Series B led by Threshold Ventures.

Tazapay, a Singapore-based fintech specialist, has raised a $16.9M Series A led by Sequoia Southeast Asia.

Andreessen Horowitz has led a $15 million Series A for remote learning startup Marker Learning. The round also included participation from Richard Branson's Virgin Group.

Commercial EV startup Turno has raised a $13.8 million Series A co-led by B Capital and Avaana Capital.

Zurich-based Nanoflex Robotics has received $12 million in a round led by Ascend Capital Partners. The startup focuses on medical robotics.

Reshape Biotech, a Copenhagen-based builder of lab automation robots, has added $7.1 million to its seed round. The round, which totals $8.1 million, was led by Acme Capital.

Act Venture Capital has led a €5 million investment in Dublin-based Spectrum.Life. The startup offers a mental health and well-being platform for the corporate, insurance and education sectors.

Sesame Labs, a Web3 marketing startup, has raised a $4.5 million seed round co-led by Wing Venture Capital and Patron. Samsung also participated, along with Balaji Srinivasan, CTO of Coinbase.

PE Deals

Francisco Partners has made a growth investment in Greenslate, a cloud-based payroll provider. VSS Capital Partners has exited its stake and reinvested in the company.

Mortgage data vendor Black Knight is courting private equity firms to buy its software business Empower for as much as $400 million, Reuters reported.

Private equity fund manager Epiris is exploring a possible $1 billion sale of Bonhams auction house, Bloomberg reported. The London-based luxury auction specialist reportedly hit $1 billion in revenue for the first time in its 230-year history in 2022.

Munich-based Dubag Group has purchased Eurovision Services, the broadcast services arm of the European Broadcasting Union. The Swiss subsidiary was created in 2019.

Exit & IPOs

Tikehau seals EuroGroup Laminations IPO

Tikehau Capital has completed the Milan IPO of Italian motors and generators company EuroGroup Laminations. The offer price of €5.50 per share suggests a market capitalization of €922 million (about $986.8 million) for the company.

View details

View similar company »

Fundraising

EQT sets sights on $22B+ infrastructure fund

EQT has set a €21 billion (about $22.5 billion) hard cap for its sixth infrastructure fund. The fund—which held a €15.7 billion close in November 2021—will focus on energy, environmental, transportation and telecommunications investments.

View fund

View 1,331 investments »

Sound Ventures targets $200M AI fund

Ashton Kutcher's Sound Ventures is discussing raising a $200 million fund for AI investments, Bloomberg reported. The firm counts Airbnb, Uber, Spotify and Pinterest among its previous investments.

View details

View 181 investments »

Corporate M&A

Kotak Mahindra eyes $65M+ microfinancing deal

Mumbai-based Kotak Mahindra Bank plans to acquire microfinance company Sonata in a $65.04 million all-cash deal. The acquisition is part of the lender's push to boost its operations for economically disenfranchised households in India.

View details

View 11 competitors »

Chart of the Day

"LPs are adopting a wait-and-see approach before committing new capital to new, less-established GPs given the nervousness of private markets deriving from the fall in public markets."

Source: PitchBook's 2022 Annual European PE Breakdown

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PitchBook News - Do all roads lead to a recession?

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