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In today's Daily Pitch, you'll find:
- Our latest US PE Breakdown offers insight into what went right for private equity in Q1 while much of the financial system floundered.
- Investment bank and brokerage Stifel is planning its expansion in the VC ecosystem in the wake of Silicon Valley Bank's collapse.
- We looked at PE energy deals in North America to tally up the 10 most-active firms.
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Exclusive: Inside Stifel's plans to win over the VC market after SVB's collapse
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| (Drew Sanders/PitchBook News) |
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The collapse of Silicon Valley Bank spooked the venture market. It also left a crater in a wealthy corner of the banking world that SVB's competitors are eager to fill.
Stifel, a financial services company, is plotting a broad expansion into the venture ecosystem following the hiring of three top bankers from SVB last month. Leaders within Stifel's commercial banking unit say the strategy is about more than savings and loans. The larger vision is to serve as a hub for the entrepreneurial community.
But uncertainty, risks and fierce competition mean that SVB's old turf likely won't go to a single winner. |
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Banking crisis tests PE's vision for private credit
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While much of the financial system turned upside down in March, it was almost business as usual for private equity dealmakers. Although some firms eyed Silicon Valley Bank's loan book as a potential means to expand their private credit offerings when the bank collapsed, they failed to land a deal. Mega-buyouts, add-ons and secondaries alike were unencumbered by the panic.
But it's never simple: PE deal value in Q1 rose over 11% from the previous quarter, while the total number of deals fell more than 9% and exit activity deteriorated. Our latest US PE Breakdown, sponsored by Stout, G-P and Barings, offers insight into what went right for private equity. Other takeaways include:
- Tech take-private buyouts in Q1 were financed with less debt than in recent history. Notable deals from March required 70% to 92% equity contributions, much higher than the typical median equity contribution of around 48%.
- Exit count and value declined for the third-straight quarter as investors balked at selling portfolio companies at lower valuations. Corporations proved popular counterparties, making up nearly 70% of all buyers of PE assets.
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Key dealmaking trends across the future of work software
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Volatility rocked markets across 2022, but the key sectors that saw dealmaking withstand pressures hint at which trends may define the 2020s. Amid general pullbacks in private dealmaking, work software saw the second-highest tallies of dealmaking ever at the expansion stage, raking in well over 1,000 completed transactions. The latest edition of Deloitte's Road to Next series explores work software dealmaking and broader trends in depth, including:
- How additional layers of analytics are folding atop all traditional functions
- The impact of evolving approaches to offices on workflows and dealmaking
- Datasets on post-money valuations, qualitative survey findings from Deloitte, and exits
Read it now |
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Mapping Central and Eastern Europe's VC ecosystem
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(Wead/Shutterstock) |
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Venture capital activity in Central and Eastern Europe got off to a slow start in 2023, and the region registered its lowest quarterly deal count in over five years.
We've mapped out some of the region's key trends across dealmaking, fundraising and exits. |
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Is Israel's tech hub status under threat?
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| (Joey Schaffer/PitchBook News) |
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A proposed reform by Israel's government that set off nationwide protests has also elicited a rare outcry from a typically apolitical VC community.
The judicial reform—which, among other things, lets the government override high-court decisions—would have little direct impact on investment. But VCs and startups alike fear the fallout could trigger a flight of capital and talent from one of the region's foremost innovation hubs. |
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Top 10 most-prolific PE investors in US energy
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| (G B Hart/Shutterstock) |
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Energy prices may rise and fall, but these investors stick through it all.
From electric utilities to oil and gas, the energy industry has faced an incredible amount of upheaval over the past five years: massive swings in oil supply and demand and an accelerating transition to cleaner fuels. We tallied up all the PE energy deals in North America to see which firms have been the most active during these tumultuous years. |
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In the midst of Arizona's historic drought, a Saudi company is tapping into its groundwater. [Fast Company]
Is there any cash left for VC newcomers? [The Information]
More than 90% of Silicon Valley Bank's deposits were uninsured, but which other US banks are sitting on unprotected cash? [Visual Capitalist] |
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Since yesterday, the PitchBook Platform added:
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21
VC valuations
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2245
People
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698
Companies
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28
Funds
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The Daily Benchmark:
2016 Vintage North American VC Funds
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Digital-first commerce platform Kite has raised $200 million from Blackstone and Juxtapose.
AlphaSense, a markets intelligence company, has raised a $100 million extension for its $225 million Series D. Investors including Alphabet's CapitalG, Goldman Sachs Asset Management and Viking Global Investors contributed to the new funding.
London-based AI data company Infogrid has raised a $90 million Series B and $30 million in debt from investors including Original Capital, SoftBank and Northzone.
VintaBio has emerged from stealth with $64 million led by Decheng Capital to develop its cell and gene therapy technologies.
Lithium extraction company EnergyX has raised a $50 million Series B led by General Motors' VC arm, GM Ventures.
Digital health company Recuro Health has raised $47 million in Series B funding from Arch Venture Partners, GPG Ventures, 4D Capital and others.
Carbon Robotics, an agtech startup that offers laser-powered weed control, has raised a $30 million Series C led by Sozo Ventures.
Elevate has raised $28 million in growth funding led by Anthemis for its HR benefits platform.
Ryse Energy, an Abu Dhabi-based maker of small wind turbines, has raised $15 million in a round led by RWE.
Indonesian cloud-kitchen startup Legit Group has secured a $13.7 million Series A led by MDI Ventures.
Point Nine and Foundamental have led an €8 million Series A for Paris-based Graneet. The startup offers financial management software for small construction companies.
Officebanao, an Indian workspace interiors platform, has raised $6 million in a round led by Lightspeed. |
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Don't miss our upcoming webinar
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Amid green shoots of optimism, stubborn economic uncertainty continues to hinder risk markets, leaving issuers, leveraged loan investors and direct lenders scrambling for deals—especially in the M&A landscape. This webinar examines trends defining the leveraged loan, private credit, high-yield bond and CLO ecosystems. Key topics include:
- While refinancings have emerged in the US leveraged loan segment, higher-reward LBO and M&A deals remain scarce.
- With an overall constraint on issuance, the burgeoning private credit segment is having to become more creative to land deals.
- After a grim 2022, the high-yield bond market took flight—but an unsettled inflationary environment could be cause for concern.
Register now to secure your spot. |
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KKR has invested in FGS Global in a deal that values the consultancy at $1.43 billion. As a result of the minority investment, Golden Gate Capital will exit its stake.
Financial infrastructure company Clear Street has raised $270 million from growth equity firm Prysm Capital. The investment brings Clear Street's Series B to $435 million and values it at $2 billion.
Audio systems maker Bose has sold its professional business unit to middle-market private equity firm Transom Capital for an undisclosed sum. The Bose Professional Division includes the company's commercial installation and conferencing businesses.
Genstar-backed financial services company Apex Group is to acquire London-based asset management services provider MJ Hudson's data and analytics unit and business outsourcing arm.
Pollen Street Capital-backed UK mortgage adviser Pivotal Growth has acquired Embrace Financial Services and First2Protect from LSL Property Services. Embrace provides mortgage and protection advice to estate agencies while First2Protect offers property insurance. |
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Blackstone has held the final close of Blackstone Real Estate Partners X on $30.4 billion. The vehicle is more than 40% larger than its predecessor, which closed in 2019.
Waterfall Asset Management has raised $485 million for Waterfall Atlas Fund. The closed-end fund will invest in commercial real estate, primarily equity, as well as distressed loans and bonds. |
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