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The Daily Pitch: VC

June 22, 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 new Private Capital Indexes report offers a cross-section of the private markets

Discover the silver linings in foodtech startups' dismal Q1

AI and an upcoming IPO for Arm have given SoftBank a new lease on life

US investors are scaling back on European venture investments

Today's Top Stories

Foodtech startups forge ahead despite limited funding

VC funding for foodtech startups hit its lowest level since 2017 in Q1, but a few noteworthy deals bucked the downward trend. Meal replacement provider YFood snagged $230 million, while niche segments like fermented protein as well as kitchen tech and robotics stood out with 83.6% and 99.8% quarter-over-quarter growth, respectively.

Our latest Emerging Tech Research lays out VC trends, key players and emerging opportunities in foodtech.

read the preview

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A new returns index for private asset allocators

Capital allocation can be a risky business. PitchBook's new Q4 2022 Private Capital Indexes report offers return, risk and other reference metrics across each of the seven private asset classes and serves as a companion to our Benchmarks and Global Fund Performance reports.

Our inaugural report offers a cross-section of the private markets across geographies, quartile rankings, time period and subclasses. These yardsticks can be used by GPs and allocators to compare asset class performance or construct a well-balanced portfolio.

read the report

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A Message From Ansarada

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SoftBank's Son is ready to invest again

Masayoshi Son
(Tomohiro Ohsumi/Getty Images)

After a long stretch on the defensive, SoftBank chief Masayoshi Son is ready to launch an offensive.

The sudden shift is being driven by Son's excitement over the potential of generative AI as well as new cash from the sale of Alibaba stock and an upcoming IPO for chipmaker Arm. The change could reinvigorate SoftBank's tech investments, which have been largely dormant in the past year.

Recommended Reads

Hippo Holdings has SPAC remorse two years after the merger that valued the insurtech specialist at $5 billion. [Fortune]

Visualizing BlackRock's top equity stakes in public companies. [Visual Capitalist]

An argument for why the internet is more like a city sanitation system than a metaphorical town square. [The Atlantic]

Since yesterday, the PitchBook Platform added:

27

VC valuations

2162

People

678

Companies

15

Funds

See what our data software can do

The Daily Benchmark:
2016 Vintage European PE Funds

Median IRR

17.76%

Top Quartile IRR

21.93%

0.77x

Median DPI

Select top performers

UFENAU V German Asset Light

Bridgepoint Development Capital III

Close Brothers Private Equity Fund IX

*IRR: net of fees

29 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Aledade, a network of primary care providers, has raised a $260 million Series F led by Lightspeed. The latest round valued the healthtech company at $3.5 billion, Reuters reported.

DexCare, which helps health systems to predict and meet patient demand, has raised a $75 million Series C led by Iconiq Growth.

Global payments startup Volt has raised a $60 million Series B led by IVP.

Fintech company TreasurySpring has raised a £15 million Series B from backers including Balderton Capital and Black Lion, Sifted reported.

Outbound AI, a startup developing conversational AI to assist with administrative work in healthcare, has raised a $16 million seed round led by Madrona and SpringRock Ventures.

Industrial manufacturing optimization software startup Fero Labs has raised a $15 million growth round led by Climate Investment.

Consumer foodtech startup BetterBrand has raised $6 million at a $170 million pre-money valuation in a Series A led by Verso Capital.

HiJiffy, a Portuguese startup offering an AI chatbot service for hotels, has raised €3.8 million in a round led by Caixa Capital.

Don't miss our upcoming webinar

With fewer avenues available, PE and VC exits through H1 2023 have remained slow. As a result, allocators are continuing to turn to the secondary market through LP-led transactions. GPs with seasoned portfolios are approaching LPs with opportunities, too.

In this webinar, our panel of industry experts will discuss the increasingly creative liquidity solutions that provide capital to market participants. Key topics include:

The overall secondary market volume through H1 2023, expectations for H2, and factors that are driving these trends.

Specific dynamics, such as pricing, facing both the LP- and GP-led secondary markets.

Register now to secure your spot.

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PE Deals

Brookfield Infrastructure Partners has agreed to acquire Compass Datacenters alongside existing investor Ontario Teachers' Pension Plan from RedBird Capital Partners and Azrieli Group. The company has an enterprise value of about $5.5 billion, Reuters reported.

Blackstone's infrastructure group has made a further $1 billion investment in renewable energy developer Invenergy, following up $3 billion in prior investments in 2021 and 2022.

Bain Capital has acquired a roughly 20% stake in IBM's Austria-based business IMS Nanofabrication, which produces multi-beam mask writers used by semiconductor manufacturers, for about $860 million.

Elliott Advisors has emerged as a potential bidder for Reiss, for a deal that could value the UK fashion chain at £500 million, Sky News reported.

Great Point Partners-backed Valenz Health, which offers a healthtech platform for self-insured employers, has received an equity investment from Kelso & Company.

Stirling Square Capital Partners has acquired a majority stake in Infobric from Summa Equity, which plans to reinvest in the company as a minority shareholder. Sweden-based Infobric is a SaaS company that serves the European construction industry.

Palatine has invested in UK waste management firm Roydon Recycling via its Impact Fund II.

Exit & IPOs

Actis has agreed to sell BTE Renewables, an African renewable energy developer, to a pair of buyers, giving the company an enterprise value of about $1 billion. Engie will buy the company's South African portfolio and team while Meridiam will acquire the Kenyan portfolio and team.

Fundraising

Former GitHub CEO Nat Friedman and Daniel Gross, ex-partner at Y Combinator, have raised a $1 billion fund to invest in AI and infrastructure companies, according to reports.

Avaana Capital, a climate-focused VC firm headquartered in Mumbai, has raised $70 million in the first close of Avaana Climate and Sustainability Fund, according to reports.

Cloud storage company Dropbox has unveiled a $50 million venture fund to invest in AI startups.

Madrona Venture Labs, Madrona's accelerator studio, has raised $11 million for its fifth fund to invest in AI companies.

Two former co-founders of bankrupt hedge fund Three Arrows Capital, Su Zhu and Kyle Davies, have launched 3AC Ventures, a partner venture fund to fintech company OPNX.

Investors

New York-based middle-market firm Bonaccord Capital Partners has picked up a minority stake in London-based peer Synova, Private Equity International reported.

Cox Enterprises has announced the launch of its venture arm, Socium Ventures.

Vitol and Riverstone Credit Partners have formed Valor Upstream Credit Partners, which targets structured credit investments in North American oil and gas companies.

Chart of the Day

"In Q1 2023, US PE middle-market buyout activity stalled again after attempting to rebound in the final quarter of 2022. ... These declines were not as steep as those in the buyout market overall, and as a result, the middle-market share of all buyout deals expanded to 76.5% in Q4 2022 and 75.6% in Q1 2023 for the highest back-to-back readings in five years."

Source: PitchBook's Q1 2023 US PE Middle Market Report

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PitchBook News - Foodtech forages for funding

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