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The Daily Pitch: VC

April 27, 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:

Discover the latest M&A dealmaking trends within industries and between regions in our Q1 2023 Global M&A Report.

A deep dive into the risks and rewards providers and investors face when taking the leap toward value-based healthcare.

Is Greycroft's billion-dollar fundraise one of the last of a dying breed?

Today's Top Stories

Discount prices keep global M&A activity afloat

A persistently gloomy macroeconomic backdrop and near banking crisis drove a decline in M&A activity in Q1 2023, pushing global deal value down 32% from the peak just over a year prior.

But total M&A deal value still topped $1 trillion for the quarter. While certain sellers—think private equity—stepped back in recent months, lower valuation multiples in some cases helped encourage deal flow.

Our Q1 2023 Global M&A Report, sponsored by Liberty GTS, explains which deals are happening and why, diving into dealmaking trends within industries and between regions:

Multiples on PE-led buyouts collapsed by 29% in Q1 after holding firm for two years, reflecting a shift to smaller and cheaper deals.

Smaller companies—those worth $100 million or less—have seen their median enterprise value drop to a revenue multiple of 1.1x, trailing behind the overall M&A market's median of 1.6x.

Founder-owned companies made up 85% of all businesses sold in Q1, their highest share of the market ever.

read the report

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Value-based healthcare is finally viable, but is the industry ready?

In the US, healthcare models have traditionally pitted the needs of the patient against those of the provider: more visits, more procedures, more money.

Now, payers, providers and policymakers agree that the industry is in the early stages of a shift toward value-based care, which prioritizes preventative care and population health and rewards providers when patients stay healthy. But for all its promise, any change is likely to be a long time coming.

Our latest analyst note spotlights key players in value-based care, highlights investment opportunities and unpacks some of the significant risks providers face when transitioning away from the fee-for-service model.

read it now

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DealCloud, by Intapp

The ultimate guide to corporate development reporting

Access to reliable information is what separates corporate development leaders from their competitors in the dealmaking landscape. By ensuring internal visibility and up-to-the-minute awareness through accurate, timely reporting, firms are more informed, more prepared, and in a stronger position to navigate the market.

With advanced reports, firms can improve corporate development intelligence throughout every stage of every transaction. Download this guide on report types and advanced capabilities that will help drive your corporate development success for the year ahead.

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Greycroft's $1B+ raise underscores trials for mega-funds

Greycroft co-founder Dana Settle
(Piaras Ó Mídheach/Getty Images)

Greycroft has closed on more than $1 billion in new capital commitments, which it will use to write checks between $500,000 and $50 million for tech startups.

But observers who are looking for glimmers of hope shouldn't put too much weight on Greycroft's latest funding pool, which took at least 16 months to close and fell short of its reported target.

Recommended Reads

A recent court decision threatens to escalate creditor-on-creditor fighting in the normally sedate leveraged loan market. [Financial Times]

Blackstone is in danger of defaulting on a $270 million loan backed by 11 apartment buildings in New York's most expensive borough. [The Wall Street Journal]

Designers and architects are creating a new generation of buildings that emphasize reusable structures and sustainable disassembly. [Wired]

Since yesterday, the PitchBook Platform added:

13

VC valuations

2029

People

604

Companies

44

Funds

See what our data software can do

The Daily Benchmark:
2013 Vintage Global PE Funds with more than $1B

Median IRR

14.00%

Top Quartile IRR

20.45%

1.17x

Median DPI

Select top performers

Sun Capital Partners VI

Altas Partners Pre-Fund Portfolio

TDR Capital III

*IRR: net of fees

36 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

People

Investment bank Moelis & Co. has brought on former SVB Securities executive Jason Auerbach as global head of technology investment banking. The bank has also hired 10 technology-focused managing directors.

VC Deals

Biotech startup Orbital Therapeutics has raised a $270 million Series A led by Arch Venture Partners, with a16z Bio + Health among the other participating investors.

Ohmium, a green hydrogen energy company, has raised a $250 million Series C growth round led by TPG.

Ursa Major has reportedly raised a $100 million Series D for its rocket engines, TechCrunch reported. Backers include BlackRock and Space Capital.

Replit has raised $97.4 million led by Andreessen Horowitz with participation from investors including Coatue, Cathie Wood's Ark Ventures and Y Combinator. Replit is creating generative AI programs for software development.

Clara, a Mexico-based provider of corporate credit cards, has secured $60 million in funding led by GGV Capital, according to reports.

Biotech startup Evommune has raised a $50 million Series B co-led by Arix Bioscience, EQT Life Sciences and SymBiosis.

Tokyo-based micromobility startup Luup has raised around 4.5 billion Japanese yen (approximately $33.7 million) in a round led by Spiral Capital.

Financial data startup Axoni has raised $20 million led by EJF Ventures.

UniSieve, a Zurich-based provider of technology to decarbonize heavy industry, has secured a $5.5 million seed investment. Investors in the round included Wingman Ventures and Ciech Ventures.

PE Deals

Singaporean sovereign wealth fund GIC and Spanish energy company Iberdrola have agreed to invest €430 million in the development of electricity transmission networks in Brazil.

FSI has agreed to invest up to €100 million in Rome-based Bancomat, which offers debit card and cash withdrawal services.

TA Associates has agreed to invest in Italian medical diagnostics company Diatech Pharmacogenetics. Alto Partners will exit its stake in the company.

Fundraising

TPG has closed TPG Tech Adjacencies II, which targets structured and opportunistic minority investments in the tech industry, on $3.4 billion.

Hunter Point Capital has raised $2.66 billion for its first fund, which will target GP stakes.

The Carlyle Group has reportedly closed its latest Asia-focused buyout fund on $950 million.

Capria Ventures has held the first close of its second fund. The vehicle, which has a target of $100 million, will invest in generative AI and climate startups in India, Southeast Asia, Latin America, the Middle East and Africa.

Dutch impact investor Pymwymic has held a €48 million second close for its Healthy Food Systems Impact Fund II.

Oakley Capital is looking to raise €1.2 billion for a continuation fund in order to hold on to German university group IU Group, Secondaries Investor reported.

Investors

Apollo Global Management has earmarked $4 billion for Apollo Clean Transition Capital. The strategy falls within the firm's sustainable investing platform, which is committed to investing $50 billion in clean energy and climate by 2027.

The Institutional Limited Partners Association plans to open a London office before the end of this year.

Corporate M&A

Kaiser Permanente plans to acquire Geisinger Health and incorporate the hospital operator into Risant Health, a new nonprofit organization focused on value-based care.

US-listed air-conditioner maker Carrier Global plans to buy Germany's Viessmann Climate Solutions, a unit of the Viessmann Group, for €12 billion.

Chart of the Day

Source: PitchBook's H2 2022 Greater China Venture Report

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PitchBook News - M&A shops the discount rack

Older messages

VC dealmaking decline levels off

Who wants to buy a unicorn?

A surge in small funds ebbs

Zombie funds could rise again

The rise of GP-led secondaries

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