PitchBook News - Banks' venture debt rebound

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The Daily Pitch: VC

August 7, 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:

Polymer and metal recycling technologies bring in more VC funding than expected

Banks look to regain dominance in the venture debt market from private lenders

The cash piles available for M&A deals are at odds with high interest rates

2023's outlook for US diesel margins is well above historic levels

Today's Top Stories

Banks poised to rebound in venture debt market

(Chesnot/Getty Images)

Private venture debt funds took market share from banks after Silicon Valley Bank's collapse, but their dominance will likely be temporary.

As the SVB bank run and its aftermath fade further into the past, venture debt from existing banks and new entrants such as HSBC may give startups a bevy of fresh new alternatives for less expensive debt financing.

Recommended Reads

Why ChatGPT is getting dumber at basic math. [The Wall Street Journal]

Interest groups tied to the meat industry have been maligning plant-based meat companies for years. Now, Beyond Meat is striking back. [Fast Company]

The AI frenzy is testing Big Tech's newfound cost discipline. [Financial Times]

Since yesterday, the PitchBook Platform added:

36

People

12

Companies

See what our data software can do

The Daily Benchmark:
2021 Vintage Global Funds-of-Funds

Median IRR

10.83%

Top Quartile IRR

17.54%

0.01x

Median DPI

Select top performers

HarbourVest International Private Equity Partners IX

Auda Capital IX U.S.

Capital Dynamics Transaction Partners 2021

*IRR: net of fees

34 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Vienna-based GoStudent, which operates an online tutoring platform, has raised $95 million from investors including Left Lane Capital, DN Capital and Tencent.

Endor Labs has raised a $70 million Series A from investors including Lightspeed, Coatue and Dell Technologies Capital. Endor's platform helps developers safely use open-source software.

Healthtech company TytoCare has raised $49 million in growth funding led by Insight Partners.

Drug formulation startup Persist AI has raised $4 million in seed funding led by 2048 Ventures.

Don't miss our upcoming webinar

US venture capital has remained under pressure. Join our panel of industry experts from PitchBook, Insperity, J.P. Morgan, and Dentons for a discussion on key findings from the Q2 2023 PitchBook-NVCA Venture Monitor.

Preliminary data shows that median seed deal size reached $2.9 million—however, this elevated figure conceals a survivorship bias.

A liquidity crunch, frozen avenues to public listings and pullback of nontraditional investors has led to a self-feeding cycle with exits unlikely to pick up.

The intentional overcapitalization of late- and venture growth-stage companies during 2021 and early 2022 has allowed many of them to delay financing in a market downturn.

Register now to secure your spot.

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PE Deals

Sixth Street is in talks to invest in the commercial rights of Florida State University's athletics department. The deal would mark the first PE investment in US collegiate sports, Sportico reported.

Blackstone is planning to submit a bid to acquire a 33.47% stake in Cipla, an Indian drug manufacturer, The Economic Times reported.

AXA IM Alts—a subsidiary of AXA Investment Managers—has agreed to acquire a 25% stake in Finerge, a Portuguese renewable power operator, from Igneo Infrastructure Partners.

Bain Capital and Indra, a Madrid-based aerospace and defense systems maker, have agreed to acquire a 9.5% stake in ITP Aero, a Spanish manufacturer of aeronautical engine components, for €175 million.

The Ontario Teachers' Pension Plan is exploring a $100 million investment in Xpressbees, an Indian ecommerce logistics startup, Bloomberg reported. The deal could value Xpressbees at $1.4 billion.

Exit & IPOs

KKR is preparing to hand off the majority of Berlin-based payments processing company Unzer to creditors including Alcentra Asset Management, Goldman Sachs Asset Management and Partners Group, Bloomberg reported.

The Ontario Teachers' Pension Plan is considering selling Ohio-based snack food maker and distributor Shearer's Foods for about $3 billion, including debt, Bloomberg reported.

VC-backed underwear brand Parade is looking for a buyer, The Information reported. The company has held talks with lingerie maker Ariela & Associates International and investment firm Windsong Global.

Event management software provider EventMobi has acquired Andreessen Horowitz-backed online events platform Run The World.

L Catterton has sold Australian swimwear brand Seafolly to Bondi Brands, Australian Financial Review reported.

Fundraising

Ribbit Capital, a fintech-focused VC firm, is nearing the $800 million target for its tenth flagship fund.

India's Elev8 Venture Partners has held a $67 million first close for Elev8-Capital Fund 1. It will target Series B and C investments in up to 14 startups with valuations between $100 million and $500 million.

Shara Senderoff and Aaron McDonald, the founders of metaverse startup Futureverse, have launched Born Ready with $50 million.

Chart of the Day

Source: 2023 Global Fund Performance Report (as of Q4 2022 with preliminary Q1 2023 data)

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