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The Daily Pitch: VC

March 19, 2024

Presented by SRS Acquiom

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

Which real estate strategies are fundraising successfully in the challenging environment?

Our latest ranking of the most active lenders in private equity

The top 10 VC-backed players in the fusion energy industry

In the Middle East and Northern Africa, PE caught rare tailwinds in the downturn

Today's Top Stories

Real estate's rocky road through 2023

Closed-end private real estate funds raised only $98.8 billion in 2023. When the data is finalized, this may still be the lowest fundraising figure since 2012, as lenders pulled back from issuing debt for new projects and high interest rates dampened dealmaking.

Opportunistic and distressed strategies stacked up the most commitments as asset managers and lenders offloaded office portfolios at steep discounts.

Our latest Global Real Estate Report, sponsored by Baker Tilly, breaks down which strategies are still fundraising successfully in the challenging environment, touching on China's struggling market, public vs. private performance and more.

read the report

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Meet the nuclear fusion startups with the deepest pockets

(Joey Schaffer/PitchBook News)

Spurred on by technological breakthroughs and expanded federal funding, VCs are paying more attention to fusion technology as a promising solution to the demands of the global energy transition.

Take a look at our list of the top VC-backed players in the fusion energy space.

see the list

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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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Ranking the most active lenders in PE

The full-year numbers are in: Six lenders took part in at least 150 deals each for US PE-backed companies during 2023, with the most active two tallying upward of 280 apiece.

Which firms led the way? See our 2023 Annual PE Lending League Tables, sponsored by TPG Twin Brook Capital Partners. The interactive tables can be sorted by deal type, geography, sector and more.

see the rankings

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Tailwinds boost Middle East PE

Dubai (Mint Images/Getty Images)

Buoyed by governmental initiatives to diversify Middle Eastern economies away from oil and gas revenues and a growing on-the-ground presence of international GPs, PE activity in the Middle East and Northern Africa region appears to be developing on strong ground.

In contrast to the US and Europe, the area's total PE deal value grew significantly last year.

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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 recent 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.

read the preview

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Since yesterday, the PitchBook Platform added:

27

VC valuations

2364

People

704

Companies

35

Funds

See what our data software can do

The Daily Benchmark: 2015 Vintage North American Real Assets Funds

Median IRR

10.29%

Top Quartile IRR

13.60%

0.78x

Median DPI

Select top performers

Carnelian Energy Capital

Lime Rock Partners VII

Blackstone Energy Partners II

*IRR: net of fees

25 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

AI security startup BigID, which is based in New York, raised a $60 million growth round led by Riverwood Capital.

San Francisco's Figure Markets, the operator of a crypto marketplace, raised a $60 million Series A led by Jump Crypto, Faction and Pantera Capital.

Carlsmed, an AI medtech startup based in California, raised a $52.5 million Series C co-led by B Capital and US Venture Partners.

Fintech startup FlexPoint raised $5 million in equity led by Haymaker Ventures and $30 million in debt from Tacora Capital.

Mission Zero, a London-based developer of direct air capture technology, secured £21.8 million in a Series A from investors including 2150, World Fund and Breakthrough Energy Ventures.

Zone, a Nigerian blockchain-enabled payment infrastructure startup, raised $8.5 million in a round led by Flourish Ventures and TLcom Capital.

UpHill Health, a Portuguese developer of software used to guide clinical decision-making, secured a €7 million Series A from investors including Explorer Investments, Redstone and Brighteye Ventures.

PitchBook webinar: Net asset value loans

Net asset value loans have emerged in recent years as a solution to support portfolio companies in maintaining liquidity through turbulent conditions. In this on-demand webinar, our panel of experts debates the benefits and drawbacks of NAV loans from both a GP and LP perspective—covering potential tensions around alignment, interest rates and more. Key topics include:

What GPs, LPs and lenders think about use cases for NAV loan proceeds.

What GPs should know when deliberating using a NAV facility.

Questions LPs should prepare when GPs are contemplating these loans.

Improving transparency around NAV loans.

Watch the webinar.

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PE Deals

The Carlyle Group is poised to enter advanced talks with Thyssenkrupp to purchase its shipbuilding unit in a €1.5 billion deal that includes debt, Bloomberg reported.

Advent International is in advanced talks to take Canada's Nuvei Corporation private, according to reports. The payments company said it is evaluating potential transactions as well as strategic alternatives.

Bluegem Capital Partners has agreed to sell Milan-based hair care product company Beautynova to PAI Partners.

Exits & IPOs

KKR is exploring a sale at about $1 billion for its majority stake in EuroKids International, a Mumbai-based preschool and early-learning chain, Bloomberg reported.

Chipmaker Nvidia is reportedly in talks to acquire Israeli AI startup Run:ai, which is backed by investors including Tiger Global and Insight Partners.

Chart of the Day

Source: 2023 Annual US PE Middle Market Report

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PitchBook News - Real estate's rocky road

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