PitchBook News - Fintech slows its pace

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The Daily Pitch: VC

January 26, 2024

Presented by Affinity

In today's Daily Pitch, you'll find:

Our analysts cover the latest fintech trends and opportunities as the sector settles down

A look at 10 fintech unicorns that are likely to go public

US investors pull back from Europe's VC market

Today's Top Stories

Fintech's tempo slows after blockbuster growth

After growing at a feverish pace for the past two years, fintech appears to be returning to a sense of normalcy, according to our latest analyst note. Among the takeaways:

Fintech companies secured $34.6 billion in VC funding across 2,055 deals in 2023, representing a year-over-year decline of -43.8% and -32.4%, respectively.

Valuations mostly declined, with the median of $19.4 million down -13% from 2022's figure.

Amid the IPO freeze, $5.9 billion in exit value was generated across 185 exits in 2023, a YoY decline of around -76% and -22%, respectively.

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IPO Watchlist: The fintech unicorns likely to go public

(Alexander Tamargo/Getty Images)

This week, the CEO of buy now, pay later leader Klarna, Sebastian Siemiatkowski, made headlines when he teased that a public listing in the US could be forthcoming. In November, the company announced it had turned its first quarterly profit, positioning itself for a long-awaited IPO.

Rapid changes to global monetary and fiscal policy have challenged fintech companies in recent years. Still, many have adapted and are—like Klarna—readying themselves for an IPO.

We used our VC Exit Predictor to highlight 10 fintech startups that might follow Klarna's example.

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CNBC Disruptor 50 nominations are open

(Zeyu Wang/Getty Images)

CNBC is taking nominations for its 2024 Disruptor 50 list, an annual assessment of the most innovative VC-backed tech companies. Startups are scored on criteria including scalability, revenue and user growth, the use of breakthrough technology, and workforce diversity. PitchBook provides data on funding, valuations and investors to inform CNBC's list.

Click here to submit your nominations. The deadline to apply is Feb. 16.

VCs dream of more-human robots

The future of startups specializing in robots that mimic human appearance and behavior may not be as far away as you think. Our recent Emerging Space Brief dives into the humanoid robotics sector, providing an overview of its current shape and the potential VC opportunities.

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VC Deals

Infinite Roots, a German developer of mycelium-based alternative proteins, raised $58 million in a Series B led by Dr. Hans Riegel Holding.

Bastille, a threat intelligence startup based in California, raised a $44 million Series C led by Goldman Sachs Asset Management.

Icotec, a Swiss developer of spinal implants for use in the treatment of cancer, raised $30 million from MVM Partners.

Washington-based Digs, which offers an AI platform for builders and homeowners, raised $14 million across its pre-seed and seed rounds. The seed round was led by Oregon Venture Fund and Legacy Capital Ventures.

Marstone, a digital investment and wealth planning startup based in New York, raised an $8 million Series B led by Mendon Venture Partners and South Rose Capital.

TextQL, an AI data analytics startup based in San Francisco, raised $4.1 million across its pre-seed and seed rounds co-led by Neo and DCM.

Conversational AI specialist DXwand secured $4 million in a Series A led by Shorooq Partners and Algebra Ventures.

London's Naq raised €3 million from investors including No Such Ventures for its automated healthcare compliance platform.

PE Deals

Hillhouse is a final bidder for Asian healthcare services company Everlife in a deal that could be valued at up to $1 billion, Reuters reported.

Yellow Wood Partners-backed beauty company Suave Brands agreed to acquire ChapStick, a lip care brand owned by consumer health company Haleon, for around $510 million.

Connecticut-based Peloton Equity made a strategic investment in OnPoint Healthcare Partners, which offers a platform intended to reduce burnout among physicians.

Highview Capital-backed food distributor GS Foods Group is acquiring Diamond Foods, a regional K-12 food distributor.

PE-backed FNZ, which offers a wealth management platform, completed its acquisition of International Fund Services & Asset Management, a B2B fund platform based in Luxembourg.

LDC exited its investment in Kerv Group, a UK cloud and digital transformation services provider, to Bridgepoint. The new investment comes via Bridgepoint Development Capital IV.

Exits & IPOs

Warburg Pincus-backed SaaS company Perfios Software is considering an IPO on India's stock exchange valued at up to $2 billion, Bloomberg reported.

Fundraising

London-based private debt investor Arcmont Asset Management reached a €10 billion final close of its fourth direct lending fund. Arcmont is an affiliate of Nuveen.

Washington, DC-based Arlington Capital Partners closed its Fund VI on $3.8 billion.

Chart of the Day

Source: PitchBook's 2024 Healthcare Outlook

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PitchBook News - Fintech slows its pace

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