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The Daily Pitch: VC

August 8, 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:

PE and VC healthcare specialist GPs have defied the fundraising slump

Our latest Q1 fund returns data shows more-realistic volatility but stays in the black

Only three startups crossed the billion-dollar valuation threshold in July

VC dealmaking in the Middle East has dropped sharply to pre-pandemic levels

Today's Top Stories

Robust fundraising opportunities for healthcare specialist GPs

PE and VC healthcare specialist GPs are defying a difficult fundraising environment. From 2020 to 2021, PE healthcare specialist fundraising for North American and European managers increased 92.4%. Meanwhile, VC life-sciences fundraising increased 108.1%, and VC non-life-sciences healthcare fundraising rose 32.4%.

What's more, allocations for PE healthcare specialists and VC non-life-sciences healthcare specialists have remained elevated since 2021. By contrast, VC life-sciences managers' fundraising has normalized.

Historical outperformance by PE healthcare specialists may have contributed to fundraising success, while the track record of VC healthcare specialists has been mixed. PitchBook's inaugural Healthcare Funds Report compiles the H1 2023 fundraising status of 450 healthcare and life-sciences specialist managers by strategic style.

read the preview

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New fund data shows performance picked up in Q1

Fund returns in the private markets can look less volatile than reality due to infrequent valuation updates within a portfolio. Our Private Capital Indexes, now with data as of Q1 2023, looks back and revises returns data in previous quarters to give a more accurate risk assessment.

In Q1, positive performance was recorded across all seven monitored asset classes for the first time in four quarters. The average return across private equity, venture capital, real estate, real assets, private debt, funds-of-funds and secondaries funds was 1.3%.

read it now

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A message from G-P

Skip new entity setup and streamline international hiring with an EOR

If you are considering entering new markets and expanding globally, understanding the process of new entity setup in your target country is a must.

For many scenarios, utilizing an Employer of Record (EOR) allows for quick and easy international hiring without creating a new legal entity. The EOR serves as the legal employer while you manage and direct the daily work of your new team member.

G-P's guide, "Entity Setup vs. an Employer of Record," lays out the process involved in entity setup and why it may be beneficial to partner with an EOR instead.

G-P's #1 Global Growth Platform enables you to find, hire, onboard, and manage teams in 180+ countries in minutes—without setting up new entities.

Download the guide now

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Unicorn creation sinks further into slump

Global unicorn creation remains lackluster, with little sign of picking up: Only three startups crossed the billion-dollar valuation threshold in July.

More than halfway through the year, 2023 is on pace for the fewest new unicorns since 2017. January was the only month to see unicorn creation reach the double digits.

All of July's new unicorns are in the information technology industry. Notably, advertising software provider Madhive raised $300 million from Goldman Sachs Asset Management, garnering the startup its $1 billion valuation.

explore our unicorn tracker

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Middle East VC suffers significant declines

Venture capital dealmaking in the Middle East has risen significantly in recent years, but the downturn dragged 2023 activity to pre-pandemic levels.

Our snapshot of the Middle Eastern market illustrates how the region has been performing across venture dealmaking, fundraising and exits.

Recommended Reads

How real is America's chipmaking renaissance? [The Economist]

The man who designed the triangular symbol for recyclables agrees that it might be time for its retirement. [The New York Times]

The promises and perils of AI have gripped the world of architecture. [The Guardian]

Since yesterday, the PitchBook Platform added:

10

VC valuations

2462

People

489

Companies

20

Funds

See what our data software can do

The Daily Benchmark:
2013 Vintage North American PE Funds

Median IRR

17.69%

Top Quartile IRR

23.87%

1.25x

Median DPI

Select top performers

Goode Partners Consumer Fund II

Clarion Investors II

Accel-KKR Capital Partners IV

*IRR: net of fees

71 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

People

Kim Kardashian's private equity firm SKKY Partners has hired former Burberry CEO Angela Ahrendts as a senior operating adviser, The Wall Street Journal reported.

VC Deals

Elon Musk's Neuralink, which is developing a brain-machine interface, has secured a $280 million Series D led by Founders Fund.

Cyber insurance startup Resilience has raised a $100 million Series D led by Intact Ventures and joined by investors including Lightspeed, General Catalyst and Founders Fund.

Tractian, a developer of equipment monitoring tech, has raised a $45 million growth round led by General Catalyst.

HR tech company One Model has raised a $41 million growth round led by Riverwood Capital.

Disperz, which offers a learning and skilling platform for businesses, has secured a $30 million Series C led by Lumos Capital and 360 One Asset.

Ivix, which offers a financial crime prevention platform, has raised a $12.5 million Series A led by Insight Partners.

Multiplayer, a startup focused on collaborative tools for distributed software developers, has secured $3 million in a round led by Bowery Capital.

Poland-based Satim, a developer of satellite-based radar imagery technology, has raised $2 million in a round led by Cultivation Capital.

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

Clayton, Dubilier & Rice has agreed to acquire NYSE-listed packaging company Veritiv for $2.3 billion.

KKR will acquire book publisher Simon & Schuster from Paramount Global in a $1.62 billion all-cash transaction.

TPG has revised its A$1.83 billion (about $1.21 billion) takeover proposal for InvoCare, an Australian funeral home operator, Bloomberg reported.

The board of Estia Health, an Australian elder care home operator, has approved an upgraded takeover offer of A$838 million (around $551 million) from Bain Capital.

Garnett Station Partners-backed Authentic Restaurant Brands is in talks for a $225 million take-private of restaurant chain Pollo Tropical's parent, Nasdaq-listed Fiesta Restaurant Group, The Wall Street Journal reported.

KKR is offering to buy all outstanding shares in German space-tech specialist OHB for €44 each. The company will delist following the transaction and the Fuchs family will retain majority control.

Neuberger Berman's alternatives business is acquiring a minority stake in Kohlberg & Company-backed Entrust, which offers consulting services for the utility and infrastructure markets.

Kohlberg & Company has agreed to acquire a majority stake in Worldwide Clinical Trials, a biotech and pharmaceuticals research company.

Deutsche Beteiligungs will acquire a majority stake in Technische Bau Dienstleistungen, a technical services provider for the construction industry.

Capital A is buying a majority stake in Caliber.global, a supply-chain management company based in The Netherlands.

Exit & IPOs

EQT has agreed to sell Schülke, a German medical hygiene products manufacturer, to a consortium led by Munich-based family office Athos.

Chart of the Day

Source: Q2 2023 PitchBook-NVCA Venture Monitor

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Introducing our healthcare funds coverage

Older messages

Banks' venture debt rebound

Are pro-rata rights good for VCs?

Ranking investor performance

Infosec VCs hold on for M&A uptick

Fund performance's glimmer of hope

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