PitchBook News - VC's holding pattern

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The Daily Pitch: VC

April 3, 2024

Presented by Dropbox DocSend

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

Take a first look at data from our upcoming PitchBook-NVCA Venture Monitor

Get a peek at the data from our upcoming US and European PE Breakdown reports

Real estate fundraising falls, but some sectors might weather the storm

Hailo raises $120 million Series C extension for hardware that runs generative AI locally

Golden State Warriors backer Arctos cinches its bulging second sports fund on $4.1 billion

Today's Top Stories

Venture still waiting for its revival

Two large tech IPOs are already out the door, and a couple more, Ibotta and Rubrik, have dropped their S-1 filings in an encouraging sign for 2024 venture exit activity. On the dealmaking side, valuations ticked back up in Q1, driven in part by the strong performance of public markets. But not all areas of VC are blooming.

VC deals are still closing at a cautious pace, and fundraising was particularly low. There's plenty of unease in the air—especially around LP sentiment. See how the start of the year shaped up for global VC with our First Look data packs for the Q1 2024 PitchBook-NVCA Venture Monitor, Q1 2024 European Venture Report and Global Venture Capital dataset.

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PE struggles to rebound

Exit activity is one metric that PE dealmakers are keeping a close watch on to gauge how much the market has recovered from its lows. The acquisition of SRS Distribution in March—a roughly $18 billion PE exit—is undoubtedly a confidence booster. But data suggests a rebound has yet to happen.

The value of global PE exits hit nearly $120 billion in the first quarter, which is below the old normal prior to the 2021 frenzy. Our First Look data packs precede the release of our quarterly US and European PE Breakdown reports, digging into trends for exits, dealmaking and fundraising.

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What last year’s pre-seed round can tell us about today’s fundraising landscape

DocSend's latest pre-seed data shows investors' focus on long-term profitability as VCs place increased emphasis on due diligence and scalability over rapid growth. Dive into the full report to learn about what the trends can tell us about the current landscape, and how successful founders have shifted their approach to meet the moment.

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Major league sports investor Arctos raises $4B+ fund

Stephen Curry of the Golden State Warriors
(Jared C. Tilton/Getty Images)

Arctos, a private investment firm with stakes in major sports teams like the Golden State Warriors and Sacramento Kings, closed its second sports-focused fund on $4.1 billion Tuesday.

Arctos Sports Partners Fund II closed well above its $2.5 billion target, bringing the firm's sports-related assets under management to around $7 billion and deepening PE's foothold in sports franchises.

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Hailo raises $120M to move generative AI beyond the cloud

(SOPA Images/Getty Images)

Hailo wants to bring generative AI everywhere. The Israeli startup has raised $120 million for its edge computing devices, specialized chips that handle tasks locally rather than sending information to a data center.

Investors hope startups like Hailo can bring generative AI to cars, industrial spaces and other applications while lowering costs.

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Real estate fundraising falls off a cliff

(Victor Cardoner/Getty Images)

Real estate fundraising fell off a cliff last year. Globally, fund managers collected $98.8 billion across 232 closed-end real estate funds in 2023, representing the industry's lowest sum since 2012, PitchBook data shows.

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UK carried interest comes under fire

Shadow Chancellor of the Exchequer Rachel Reeves
(Dan Kitwood/Getty Images)

As the UK's next general election draws near, the tax paid on carried interest is coming under increased scrutiny.

While the UK's Labour Party has pledged to increase the tax, it's facing mounting pressure to reverse course.

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Since yesterday, the PitchBook Platform added:

31

VC valuations

2170

People

749

Companies

23

Funds

See what our data software can do

The Daily Benchmark:
2020 Vintage Global Real Assets Funds

Median IRR

12.20%

Top Quartile IRR

20.56%

0.08x

Median DPI

Select top performers

Kimmeridge Energy Engagement Partners

NGP Royalty Partners

Five Point Energy Fund III

*IRR: net of fees

44 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

People

Calpers has selected Stephen Gilmore as its new chief investment officer starting in July.

VC Deals

Los Angeles-based Flip raised a $144 million Series C led by Streamlined Ventures for its social shopping platform.

The Brandtech Group, a digital marketing startup based in New York, raised a $115 million Series C from Fimalac and NendoLabs.

Onego Bio, a Helsinki-based developer of animal-free egg protein, closed a $40 million Series A led by NordicNinja.

Legal AI startup Luminance, which is based in London, raised a $40 million Series B led by March Capital.

Israel-based printing B2B startup Velox raised $38 million in a round led by Fortissimo Capital.

Modal, based in San Francisco, raised a $25 million Series A led by Left Lane Capital and Ensemble VC for its employee education and training platform.

Read AI, a Seattle-based meeting analytics startup, raised a $21 million Series A led by Goodwater Capital.

CryoTherapeutics, a Belgian developer of medical devices intended to prevent heart attacks, raised a €10 million Series B from investors including Noshaq, Peppermint Venture Partners and GED Ventures.

PitchBook webinar: Insights into investment firm compensation trends

Join us for a discussion on how compensation trends at VC and PE firms have changed in recent years and what we might expect moving forward. Jody Thelander, founder & CEO of the namesake firm; Kaidi Gao, PitchBook VC research analyst; and Jim Jensen, partner at Wilson Sonsini Goodrich & Rosati, will share real-time data on base salaries, bonuses, carried interest percentages and more across various positions. Key topics include:

Compensation trends year-over-year by total AUM and type of firm.

Best practices for fund structure, including fund formation and carried interest.

Register now to secure your spot.

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PE Deals

Clayton, Dubilier & Rice agreed to buy a majority stake in IT services specialist Presidio. BC Partners will retain minority ownership interest.

Talent agency Endeavor Group agreed to be acquired by Silver Lake for $13 billion, Bloomberg reported.

EQT Private Equity agreed to acquire Avetta, a SaaS company specializing in risk and compliance management, from Welsh, Carson, Anderson & Stowe.

Quantix, a portfolio company of Wind Point Partners, acquired CLX Logistics to expand its presence in North America and Europe as a provider of global chemical supply chain logistics.

Healthcare research and technology company Clario, which is backed by Astorg, Cinven and others, acquired AI-powered medical software startup ArtiQ.

Morgan Stanley Capital Partners acquired Resource Innovations, which offers energy efficiency and sustainability services, from BV Investment Partners.

Exits & IPOs

PACS Group, a post-acute healthcare company, is seeking a valuation of up to $3.25 billion in a US IPO, Reuters reported.

Fundraising

OceanSound Partners closed a single-asset continuation fund for SMX Group on $1.15 billion.

ICG closed its first LP-led secondaries fund on $1 billion.

New York-based Autism Impact Fund, a firm that invests in healthcare startups focused on autism spectrum disorder, closed its first fund on $60 million, TechCrunch reported.

Corporate M&A

Honeywell is considering a sale of its personal protective equipment unit that could value the business at more than $2 billion, Bloomberg reported.

Chart of the Day

Source: 2023 Annual Global Private Debt Report

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