PitchBook News - Founders edge into VC LP bases

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The Daily Pitch: VC

February 13, 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:

A recent fund backed by a gaggle of founders shows how LP bases are evolving in VC

After a rough period, are secondaries funds geared up for a rebound?

Valuation growth between funding rounds slows significantly for late-stage startups

Information technology startups make a showing among 2024's first unicorns

Today's Top Stories

Founders, family offices step up to fill VC fundraising gap

(Richard Levine/Getty Images)

When London-based Episode 1 Ventures closed its latest fund on £76 million (about $96 million), there was something different about its LP base: Founders make up more than a third of the backers.

As VC firms mature, high-net-worth individuals and single-family offices tend to play second fiddle to institutional LPs that can write bigger checks. But as institutional LPs have retreated from venture, GPs are increasingly tapping into that network of high-net-worth investors, who are eager to access premier funds.

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Industrial carbon-tech specialists capture VC boost

Startups focusing on carbon and emissions tech didn't see the dealmaking frenzy in Q4 that they did in the previous quarter—when VC funding topped $8 billion. But the sector still captured more than $2 billion in Q4, according to our recent Emerging Tech Research.

The industrial segment, which includes low-carbon manufacturing, recycling and mining, has been particularly hot in the past 12 months, bringing in $8.5 billion.

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Blended-wing aircraft designs could fuel change

The aviation industry has a carbon emissions problem, but the solution may not be that far off. Our recent analyst note dives into blended-wing aircraft. This more fuel-efficient design has been around for decades, but it's now finding support among startups looking to disrupt the aerospace sector.

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People

Trilantic Europe has brought on Eugenio Preve and Yasir Piracha as partners to lead its Italian and German teams, respectively. Preve joins from Cinven, where he headed the firm's Milan office. Piracha was head of healthcare at Quadriga Capital in Germany.

VC Deals

Crowdsourced cybersecurity startup Bugcrowd secured $102 million in growth funding led by General Catalyst.

Alys Pharmaceuticals launched with $100 million in backing from Medicxi. The company is developing dermatological treatments and was formed from the merger of six Medicxi-owned companies.

LeoLabs raised a $29 million extension round led by GP Bullhound to fund its platform for tracking objects in low Earth orbit.

LionVolt, based in The Netherlands, secured €15 million from undisclosed investors to develop solid-state batteries.

Quantum computing startup Diraq raised a $15 million Series A2 led by Quantonation.

Ilara Health has raised $4.2 million, comprising debt and $2.5 million in pre-Series A funding led by DOB Equity. The Kenyan healthtech startup allows clinics to access diagnostic devices and pharmaceutical products.

Amazec Photonics, a Netherlands-based startup that makes cardiovascular monitoring tools, has raised €1.5 million in a seed round led by PhotonDelta.

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PE Deals

L Catterton joined the Della Valle family, which founded luxury brand Tod's, in a bid to take the Italian shoemaker private, Reuters reported. L Catterton offered to buy 36% of the company at a 17.6% premium to last week's closing price.

Ambienta bought a majority stake in Officine Maccaferri, an Italian provider of low-emission solutions for the civil engineering and environmental construction sectors.

Martin Marietta Materials agreed to pay $2.05 billion in cash to buy a portfolio of construction aggregates operations in the US Southeast from Blue Water Industries, which is backed by PE firm Blue Water Advisors.

Bain Capital Insurance agreed to buy a majority stake in claims management business Ryze Claim Solutions Partners.

Velocys, a British maker of sustainable jet fuel, raised $40 million from a group of investors that agreed to take it private late last year, including Carbon Direct Capital, Lightrock, GenZero and Kibo Investments.

Portfolio Companies

Productivity software maker Notion has acquired Skiff, a much smaller rival that focuses on privacy. Skiff previously raised more than $14 million across two rounds led by Sequoia.

Exits & IPOs

Advent International has approached Rothschild to advise on a potential sale of parcel delivery company Evri, The Sunday Times reported. A sale could value the business at £2 billion, including debt.

MDB Capital Holdings-backed biomanufacturing company Invizyne Technologies filed to go public on the Nasdaq. It will seek to raise $17.2 million in the offering.

EQT intends to sell Idealista, a Spanish real estate website, in a deal that could value the company at €2.5 billion, Reuters reported. EQT bought Idealista for €1.3 billion in 2020.

Fundraising

Epiris held a £1.04 billion final close of Epiris Fund III, exceeding its £850 million target. The new vehicle is 27% larger than its predecessor.

Ares Management raised A$2.6 billion (about $1.7 billion) for its first credit fund focused on Australia and New Zealand.

Abu Dhabi-based Advanced Technology Research Council allocated $200 million to an initiative it will use to fund tech innovation in developing nations.

Homebrew Ventures is targeting $50 million for its fifth fund, according to an SEC filing.

Chart of the Day

"In line with the broader asset class, 2023 was a historically poor year for PE healthcare services exits. We recorded 39 exits total, 22.0% below the next-lowest year on record, 2019. The decline was primarily driven by the dearth of sponsor-to-sponsor exits; we recorded only 18 of these for the year, almost half the pace set in the next-slowest year on record, 2020."

Source: Q4 2023 Healthcare Services Report

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PitchBook News - Founders edge into VC LP bases

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