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The Daily Pitch: VC

May 9, 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:

Investors are cooling on retail fintech, but a less crowded B2C market could have its upsides.

We've mapped out the 10 Chinese cities that attracted the largest number of PE deals between 2016 and 2022.

VC funding for US female-founded startups has returned to pre-pandemic levels.

Today's Top Stories

B2B startups steal retail fintech's thunder

Challenges for consumer-facing fintech startups have driven investors toward B2B investment opportunities. And while PitchBook analysts expect VC investment in fintech to continue to fall, a less crowded B2C market does have its upsides.

Our latest Emerging Tech Research explores recent VC trends in the retail fintech vertical and long-term opportunities like digital financial passports and open-loop P2P payments. It also includes company highlights on Portabl and Ping.

read the preview

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Map: 10 cities powering China's PE growth

Shanghai is among the top cities for PE investment in China.
(chuyuss/Shutterstock)

China has long been a powerhouse for Asian private equity. Last year, the country suffered a steep decline in PE deal activity as a result of economic headwinds. Even so, it still captured over a quarter of PE investment in Asia.

However, much of this activity is concentrated in a handful of urban centers. We've mapped out the 10 Chinese cities that attracted the largest number of PE deals between 2016 and 2022. Companies in these cities accounted for nearly two-thirds of the country's total PE deal count during that time.

see the map

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A message from Founder Shield

2023 playbook to funding success: expert advice for tech founders

Are you an ambitious founder with an early-stage startup eager to secure funding? You should know: Private fundraising levels have declined across the US since a record-breaking 2021. Late-stage companies are the hardest hit, leaving the runway wide open for Series A and B rounds.

Founder Shield's "Founder's Playbook to Raising Funding in 2023" is your key to success. Gain invaluable insights from industry giants, including top VC firms, seasoned lawyers, and risk management experts. They reveal their tried-and-true strategies for funding success.

In this step-by-step guide, Founder Shield unravels some of the most common mistakes founders make when securing funding. Let it share its knowledge—from pitch decks to terms sheets to fundraising strategy—so that you can focus on scaling. Download your copy today

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Mayfield closes on $955M as LPs reward restraint in investment pace

(Real Sports Photos/Shutterstock)

VC firm Mayfield, known for its investments in HashiCorp, Lyft and Mammoth Biosciences, closed yesterday on $955 million across two oversubscribed vehicles.

While it may have seemed that much of the VC world broke into a fundraising sprint in late 2020 and 2021, Mayfield maintained a slow but steady investment pace. The firm has consistently backed about 14 new companies every year for the last 10 years.

Trust is key to partnership, and SVB is committed to regaining yours

With the strength and stability of First Citizens behind Silicon Valley Bank, it continues to be positioned to deliver specialized lending and financial solutions for innovation companies and investors.

Read more here

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VC Deals

UK-based Ascend has raised $130 million to expand production of their gene therapies in a round co-led by Abingworth and Petrichor, the Financial Times reported.

Liquido, a California-based payments platform startup that serves Latin America, has emerged from stealth with a $26 million round led by Index Ventures.

PermitFlow, a software startup that automates the construction permitting process, has raised $5.5 million in seed funding led by Initialized Capital.

Emerging from stealth, BurnerPage has secured $2 million in pre-seed funding led by LDV Capital. The company uses generative AI to optimize webpages.

MetaZ Holdings, a South Korean company that combines the sneaker resell market with NFTs, has raised a $1 million Series A from Pinewood Capital.

PitchBook webinar: What is the future of VC exits?

Today's VC market is one of unprecedented company data and investment options. These have proven to both help and hinder investors. Despite enabling a greater range of strategies and more market awareness, the volume of information to process has greatly complicated deal sourcing.

A panel of speakers from PitchBook's product and analyst teams will share how VC investors can succeed in the current market and what tools can guide them to the best deals. Key topics include:

Learn the current trends of the exit market and what might come in 2023.

Understand how PitchBook is creating tools that help our users win.

Learn how the PitchBook VC Exit Predictor can make market research and deal sourcing more efficient.

Register now to secure your spot.

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PE Deals

Medtech company Baxter International has reached a deal to sell its biopharma business unit to Advent International and Warburg Pincus for $4.25 billion.

Apollo Global Management and Abu Dhabi's national oil company Adnoc have offered $7.6 billion to buy Brazilian petrochemical-maker Braskem, Bloomberg reported.

HSBC has landed a deal to buy out its China fund management partner HSBC Jintrust Fund Management from majority stakeholder Shanxi Trust, Reuters reported.

New Mountain Capital has bought healthtech AI software business Apixio for $280 million, Axios reported. Apixio was previously acquired by Centene in 2020.

Accordion, a portfolio company of Charlesbank Capital Partners and Motive Partners, has agreed to acquire India-based data analytics and intelligence solutions provider Merilytics.

Court Square Partners has made a strategic capital investment in Tenex Capital Management-backed Team Select Home Care, a healthcare service platform for home health, outpatient therapy and long-term care.

Fundraising

Ares Management is aiming to raise $10 billion for its Senior Direct Lending Fund III, The Wall Street Journal reported.

Bain Capital has raised about $2 billion of a $4 billion target for a global special situations fund aimed at distressed investments, Reuters reported.

Sydney-based Pacific Equity Partners has raised A$1.4 billion (around $949 million) for its Secure Assets Fund II, Infrastructure Investor reported.

Investors

In its Q1 earnings report, KKR has reported a 26% year-over-year drop in its after-tax distributable earnings. Its profits from asset sales fell 70%, and its portfolio company transaction fees dropped over 60%.

Chart of the Day

Source: PitchBook's 2022 Annual US PE Middle Market Report

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PitchBook News - Investors pan for retail fintech gold

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