PitchBook News - VC gloom: Who powered through?

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The Daily Pitch: VC

February 5, 2024

The Daily Pitch is powered by PitchBook’s industry-defining research and best-in-class data

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

Is it time for private equity to start investing in semiconductors?

Founders of young companies are increasingly willing to sell early, buoying seed-stage M&A

Our latest PitchBook-NVCA Venture Monitor, now with league tables ranking the industry's most active players

Today's Top Stories

VC gloom: Who powered through?

The latest PitchBook-NVCA Venture Monitor, sponsored by J.P. Morgan, Dentons and Deloitte, now includes league tables ranking the industry's most active players.

Venture capital had a tough year. Not only was there a $71.6 billion drop in funding for the strategy—more than $88 billion if you exclude OpenAI and Anthropic's behemoth rounds. But the high number of companies still private, and the pullback of many investors, has led to a wide spread between capital needs and available supply.

VC deal count was still higher in Q4 than in any quarter in the pre-2020 days, but bridge rounds have become an artificial signal of strength. Which firms kept investing through 2023's volatility?

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M&A of seed-stage startups outshines mature companies

(Micha Pawlitzki/Getty Images)

2023 was a dismal year for VC-backed M&A, but it wasn't as bad for seed-stage startups.

Founders saw the environment for fundraising becoming more difficult, and secondary share sales at the Series A stage had ceased. Instead, they sprang to sell their young companies early.

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Can AI-powered drones fix the US farming industry?

Despite a slow quarter for agtech deals overall, agribusiness marketplaces, drone specialists and imagery startups performed strongly—especially those focusing on generative AI applications.

It may feel like doom and gloom compared to 2021, but labor shortages, climate change and supply chain disruptions will require economic transformations that agtech specialists are well positioned for, according to our Q4 2023 Agtech Report. From precision farming to optimized crop management, there's much in store for the industry in 2024.

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Since yesterday, the PitchBook Platform added:

15

People

11

Companies

See what our data software can do

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

Median IRR

10.64%

Top Quartile IRR

17.13%

0.02x

Median DPI

Select top performers

Capital Dynamics Transaction Partners 2021

Aberdeen U.S. Private Equity IX

HarbourVest International Private Equity Partners IX

*IRR: net of fees

41 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Digital health and medical device startup Avation Medical has raised a $22 million Series C led by ShangBay Capital and Asahi Kasei.

Denver-based Splash has raised a $14.1 million Series A2 backed by Boston Seed, Velvet Sea Ventures and K5 for its sports strategy games.

Delaware-based Podcastle, which offers an AI platform for podcasting, has raised a $13.5 million Series A led by Mosaic Ventures.

Ireland's CitySwift, which specializes in intelligent transportation data, has raised €7 million led by Gresham House Ventures.

Edrone has secured €4.6 million from investors including Inventures. The Polish company provides customer relationship management and marketing automation systems for ecommerce.

California-based Eggscape Entertainment, a gaming studio that creates mixed-reality applications, has received a $4.25 million seed round led by Transcend Fund.

Harbor, a Dallas-based infant care technology startup, has raised a $3.7 million seed round led by Trust Ventures.

KuCoin Ventures has made a strategic investment in AI blockchain company Ta-da.

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Where large incumbents are falling short and how startups can break through.

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PE Deals

Singapore-based Whites Group has agreed to invest up to $500 million each into two Chinese financial services companies: Nasdaq-listed Fanhua and Puyi.

RA Capital Management is leading a PIPE financing in Nasdaq-listed Tyra Biosciences for gross proceeds of approximately $200 million.

OpenGate Capital has bought arcade game supplier Player One Amusement Group from Cineplex for $155 million.

Barclays is talking to PE firms about taking a majority stake in its UK merchant payments business, Reuters reported.

Blackhawk Network, a portfolio company of Silver Lake and P2 Capital Partners, has acquired digital B2B gift card rewards company Tango Card.

Chart of the Day

Source: Q4 2023 PitchBook-NVCA Venture Monitor

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PitchBook News - VC gloom: Who powered through?

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