1. Home
  2. Discover
  3. Business
  4. PitchBook News

PitchBook News - Emerging managers pull their weight

Plus: The latest in climate tech, introducing our LP-focused newsletter, the upside of up-and-coming managers & more
Read online | Don't want to receive these emails? Manage your subscription.
PitchBook
Log in
The Weekend Pitch
May 5, 2024
Presented by the U.S. National Science Foundation
(Joey Schaffer/PitchBook News)
Risk-averse LPs tend to gravitate to fund managers with a long track record, but are they missing out on potential upside by avoiding emerging managers?

Over the past decade, emerging managers' share of US private market fundraising activity has declined steadily.

In 2023, this figure fell to 12.7%, the lowest share of capital raised by newer fund managers since before 2000, according to our recent analyst note, Establishing a Case for Emerging Managers.

Limited exits in PE and VC over the past two years have exacerbated this reality. With minimal distributions, LPs are working with smaller private market budgets to allocate to new and existing managers.

But, by allocating almost exclusively to established managers, LPs may be missing out on significant potential returns.

This is The Weekend Pitch, and I'm Jessica Hamlin. You can reach me at jessica.hamlin@pitchbook.com or on X @jessicaAhamlin.
read more
 
Share: Email LinkedIn Twitter Facebook
 
A message from the U.S. National Science Foundation  
Invention to impact
Revterra uses recycled steel to create long-lasting, scalable kinetic batteries for electric vehicle (EV) charging stations, which allows for EVs to charge quickly with less strain on power grids. Revterra (NSF-2231076) is one of the hundreds of deep tech startups funded annually by the U.S. National Science Foundation (NSF), a government agency that plays a central role in accelerating discoveries into the marketplace.

Each startup can receive up to $2 million to support translational research & development. By investing more than $200 million in startups annually, NSF helps teams navigate the earliest stages of technology translation. These companies have gone on to raise billions in follow-on capital, and the portfolio has had 300+ exits. Learn more about NSF funding at seedfund.nsf.gov/next/.
Share: Email LinkedIn Twitter Facebook
 
 

Trivia
The race for AI dominance is intensifying, and Middle Eastern nations are driving capital into the technology. In 2023, the region saw a record number of VC deals for generative AI startups, according to PitchBook data. How many deals closed in 2023?

A) 20
B) 34
C) 39
D) 59

Find your answer at the bottom of The Weekend Pitch!
 

Green steel dominates climate-tech deals
(Anucha Sirivisansuwan/Getty Images)
Even accounting for H2 Green Steel's mega-financing round of over $5 billion, climate-tech deals grew nearly 38% in Q1, buoyed by US federal investment in industrial decarbonization.

Infrastructure, industry and renewable battery deals are hot commodities and median pre-money valuations appear to be rising across the board, according to our latest Carbon & Emissions Tech Report. Climate-tech startups are rapidly developing more sophisticated approaches to permanent carbon-storage solutions, and investors are paying attention.
 

Our new LP-focused newsletter
The head of real assets at the New Jersey Division of Investment spoke to senior reporter Jessica Hamlin about how he accomplished an overhaul of the plan's fossil fuel-heavy portfolio.

Niraj Agarwal is in the process of offloading the pension plan's legacy investments in upstream oil, gas, mining and metals and making new allocations to digital infrastructure and the energy transition.

Since 2021, when he joined the investment team that manages the some $96.8 billion in assets from the state's seven public pension plans, he has reduced the portfolio's conventional energy exposure from around 60% to 25%.

This story originally appeared in our new Capital Pool newsletter, which features exclusive reporting and commentary on what's driving LP decision-making.

Subscribe here.
 

The upside of up-and-coming managers
(Utamaru Kido/Getty Images)
Established managers have a significant edge in the downtrodden fundraising market—and with good reason. They have earned trust with LPs and can pin their reputation on real returns.

But there's a risk to overlooking upstarts. The data shows that the top emerging managers in multiple strategies can offer higher upside potential than tried-and-true firms. Our recent analyst note examines performance trends across buyout, venture, real estate and private debt funds.
 

Quote/Unquote
"The shotgun approach to running diligence has made it very hard [for institutional LPs] to feel comfortable."

—Sid Trivedi, partner at Foundation Capital, speaking to PitchBook News about the challenges of getting LPs to commit to crypto-focused funds.
 

Stay tuned
Keep an eye out for these insights and research reports coming out this week:
  • Q1 2024 Enterprise Fintech Report
  • 2024 Global Fund Performance Report (as of Q3 2023)
  • Q1 2024 Healthcare Services Report
  • Q1 2024 US VC Valuations Report
  • Q1 2024 Gaming Report
 

Trivia
(Ayman Zaid/Getty Images)
Answer: C)

Thirty-nine deals closed for generative AI startups based in the Middle East in 2023, generating $415.1 million. Read more about what driving the trend.

This edition of The Weekend Pitch was written by Jessica Hamlin and Jacob Robbins. It was edited by Heather West and Samantha Steele.

Were you forwarded The Weekend Pitch? Sign up at pitchbook.com/subscribe.
 
Ads
Since yesterday, the PitchBook Platform added:
63
People
20
Companies
See what our data software can do
 
Ads
 
About PitchBook | Terms of use | Advertise with us | Contact
Follow us: in twtr fb

This email was sent to you via the PitchBook Platform.

Do you want to change your email address, get a different edition or unsubscribe? Manage your subscription here.

PitchBook Data Inc., 901 Fifth Avenue, Suite 1200, Seattle WA 98164, United States

© 2024 PitchBook. Win what's next. All rights reserved.

Older messages

Does experience matter?

Saturday, May 4, 2024

Also: Forecasting private capital's path to $20 trillion in AUM; Recapping market performance in April; Can payments re-energize enterprise fintech? Read online | Don't want to receive these

Zero-carbon push lifts climate tech

Friday, May 3, 2024

Fintech unicorn founder will 'never sell'; AI's latest unicorns; cancer specialist Delphia Therapeutics captures $67M Read online | Don't want to receive these emails? Manage your

LPs return to warming crypto market

Thursday, May 2, 2024

Startups profit on Mideast's AI venture activity; global market trends of April; pension plan boosts private debt target Read online | Don't want to receive these emails? Manage your

The top 50 cities for startups

Wednesday, May 1, 2024

Specialist VCs drive infosec; Island doubles valuation to $3B; Corelight bags $150M for cybersecurity Read online | Don't want to receive these emails? Manage your subscription. Log in The Daily

A case for emerging managers

Tuesday, April 30, 2024

Our new LP-focused newsletter; General Catalyst, a16z eat up 44% of LP VC; these digital health unicorns have eyes on IPO Read online | Don't want to receive these emails? Manage your subscription.

You Might Also Like

Update: AI Explored podcast With Michael Stelzner

Saturday, May 18, 2024

Hey, Reader! We've got some exciting news. Not only did we launch the AI Explored podcast on Apple Podcasts, Spotify, YouTube Music, and Amazon Music—we did even one better. I realize so many of

'Can You Stay Curious a Little Bit Longer?'

Saturday, May 18, 2024

We spoke to best-selling author Michael Bungay Stanier about why it's so critical to take risks, the "fierce love" element of coaching, and resisting the temptation to give advice. ‌ ‌ ‌

The Catch-22 in Hiring Today

Saturday, May 18, 2024

There shouldn't be, but there is To view this email as a web page, click here saastr daily newsletter The Catch-22 in Hiring Today By Jason Lemkin Friday, May 17, 2024 | Growth So there's a

Don't Overlook Creatives: Success with TikTok ads

Saturday, May 18, 2024

Discover the Psychology Behind Effective Ads ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Valuations can be deceiving

Saturday, May 18, 2024

Also: Ranking the top VC investors of Q1; Our analysts' key takeaways from a number of recent conferences; Don't miss our tech talk on gaming! Read online | Don't want to receive these

How will foreign policy fare after the world's biggest election?

Saturday, May 18, 2024

Multiple diplomatic challenges await the new government that takes charge in New Delhi in June ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏

7 secrets of Reddit

Saturday, May 18, 2024

Today's hack Very Positive or Very Negative posts perform significantly better than Neutral ones on Reddit Datastories analyzed 4 million data points to see what makes it to the front page of

Profit Potential - Not to Be Taken Lightly

Saturday, May 18, 2024

Say goodbye to endless testing and hello to profitable campaigns View in browser ClickBank Are You Ready to Revolutionize Your Affiliate Marketing Game? A groundbreaking opportunity is waiting for you.

The Future of Coding with AI: An Interview with Eli Hooten

Saturday, May 18, 2024

We discuss essential skills for software engineers, the role of open source, and embracing AI as a force multiplier ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

🎙️ Find That Pod #262

Friday, May 17, 2024

Let's discover some awesome podcasts together. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌