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The Daily Pitch: VC

March 5, 2024

Presented by SRS Acquiom

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

Our analysts plot out 20 VC-backed IPO candidates

Biopharma investors focus in on startups using AI and developing weight loss drugs

From drones to smart field equipment, our agtech market map dives into the precision agriculture segment

Ares Management tapped banking talent to help its offerings in the asset-based credit market

Today's Top Stories

20 companies most likely to IPO in 2024

After a slow two years, the IPO market is expected to pick up in the back half of 2024. In anticipation of this mass liquidity event, PitchBook's Emerging Tech Research analysts plotted the 20 VC-backed companies most likely to IPO with their newest valuation and revenue figures in our latest analyst note.

Among the top picks are renewable battery company Northvolt, cybersecurity darling Rubrik and, of course, fintech giant Stripe. But can you guess the rest?

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Biopharma investors focus on quality over quantity

Despite a 19% quarter-over-quarter decline in deal value in Q4, investor enthusiasm for the biopharma industry is holding strong, particularly for companies integrating AI into drug discovery and those developing weight loss drugs.

Meanwhile, a steady flow of exits returned $18.3 billion to VCs in 2023, the result of an increasingly selective investment approach driven by strong clinical data and recalibrating technology platform investment interest, writes senior analyst Kazi Helal.

Our latest Emerging Tech Research unpacks recent VC trends across the biopharma industry, spotlights key players and highlights emerging opportunities in molecular glue degraders, epigenetic editing and macrocyclic peptides.

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A message from SRS Acquiom

Ignoring working capital on M&A deals can mean leaving money on the table

Stay ahead of the latest M&A Purchase Price Adjustment insights and trends to help ensure that working capital works as intended on your next deal. The new 2024 SRS Acquiom M&A Working Capital PPA Study features exclusive data as well as insights and drafting considerations gleaned from over 2,400 PPAs resolved by the SRS Acquiom team of M&A experts. Learn about:

Increasingly customized PPA provisions: Tailored to deal specifics and the target's financial statements
Bigger special escrows for PPAs: Median sizes reaching 1% of the transaction value
More "two-way" PPAs: Resulting in a seller-favorable surplus on approximately 2 in 5 deals, up from 1 in 4 a decade ago

Get the Study Now

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Market Map: Drones and robots pull VCs back to agtech

(NurPhoto/Getty Images)

Agtech startups have undoubtedly had a challenging 2023. But amid the gloom, one sub-sector has fared remarkably well: Precision agriculture technologies, from drones to farm labor marketplaces, have ballooned as a share of VC activity in agtech.

Explore the nearly 1,000 precision ag companies that have raised billions in venture funding since their inception with our proprietary market map.

explore the market map

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Ares grabs bank assets to expand in asset-based credit market

(Nora Carol Photography/Getty Images)

Ares Management has acquired the management team and operating platform from a unit of one of the largest community banks in Florida. The move bolsters its lending capacity in a niche market: financing businesses in buying equipment. Ares is among a handful of GPs moving into the growing asset-based credit market.

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Funds

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People

Khosla Ventures has had a spree of high-profile hires, including Ethan Choi from Accel, Jai Sajnani from NEA, Keith Rabois from Founders Fund, and Alex Bentley from startup Block.

Sam Blond, a partner at Founders Fund, said he has left the firm.

VC Deals

Mews has raised $110 million led by Kinnevik, valuing the company at $1.2 billion. The Amsterdam-based company provides a hospitality management platform.

Ecommerce aggregator Razor is buying peer Perch after securing a $100 million investment led by Presight Capital, according to reports. The combined company will reportedly be worth $1.7 billion.

Massachusetts-based biotech startup Nocion Therapeutics has raised a $62 million Series B led by Arkin Bio Capital and Monograph Capital.

UK-based medical device startup Phagenesis has received a $42 million Series D led by EQT Life Sciences and Sectoral Asset Management.

New York-based healthtech startup Healthee has raised a $32 million Series A co-led by Fin Capital, Glilot Capital Partners and Group11.

Maybell Quantum, a Denver-based quantum computing startup, has raised a $25 million Series A led by Cerberus Capital Management.

Pet shop business management startup MoeGo, which is based in California, has raised a $24 million Series A led by Base10 Partners, Axios reported.

Topsort, a San Francisco-based AI advertising startup, has raised a $20 million Series A led by Upload Ventures.

Synctera, a payments startup based in San Francisco, has extended its Series A with $18.6 million co-led by Lightspeed and Fin Capital.

London-based renewable energy startup Gridcog has secured £3.3 million in a round led by AlbionVC.

PE Deals

Arkhouse Management and Brigade Capital Management have increased their bid for retail giant Macy's to approximately $6.6 billion.

General Atlantic has made a strategic growth investment in Plusgrade, a revenue opportunities provider for the travel industry. Novacap has fully exited its stake in Plusgrade, and CDPQ remains a shareholder.

Aerospace-focused PE firm AE Industrial Partners has acquired Calca Solutions, a hydrazine manufacturer.

Philadelphia-based retirement plan recordkeeper PCS Retirement has received a majority investment from Lee Equity Partners.

Sweden's Summa Equity has invested in STIM, a Nordic supplier of fish health products and services.

New York-based healthcare PE firm WindRose Health Investors has acquired CardioOne, an enablement company for independent cardiologists.

Cinven picked up a majority stake in Permira-backed fund administrator Alter Domus. Permira will sell approximately half of its shares to Cinven, retaining a significant investment.

Exits & IPOs

Bridgepoint is in talks to sell Dorna Sports, which owns global motorcycle racing series MotoGP, Sky News reported. UK-based Bridgepoint is targeting a valuation of up to £3.5 billion, according to the report.

Pango is in advanced talks to buy Gett, a VNV Global-backed transportation company, at a $250 million valuation after acquisition talks with Fortissimo Capital fell through, Calcalist reported.

Fundraising

Healthcare-focused PE firm Avista Capital Partners has raised $1.5 billion for Avista Healthcare Partners VI, The Wall Street Journal reported.

Cibus Capital, a London-based investor focused on agriculture and food, has raised $645 million across two funds: $510 million for its second middle-market PE fund and $135 million for its second venture fund, Axios reported.

Secondaries investor Coller Capital has committed to Permira's latest continuation fund, making it the largest investor at 50% of capital raised. The fund will include five assets from Permira's fourth and fifth namesake vehicles.

Commerce Ventures, a San Francisco-based venture firm, has raised $150 million for its fifth flagship fund, which will back retail and fintech startups.

Chart of the Day

Source: 2023 Annual Global M&A Report

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