PitchBook News - VC fundraising's split forecast

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The Daily Pitch: VC

May 10, 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:

Our analysts forecast that VC fundraising won't recover to recent highs until after 2028

Our latest Emerging Tech Research maps areas of opportunity in the gaming industry

Europe's VC industry is slowly embracing the rise of the solo GP

Analysts find generalist VCs have left information security to the specialist investors

Today's Top Stories

VC fundraising may not recover until the end of the decade

(Wong Yu Liang/Getty Images)

Venture capital firms enjoyed a windfall in 2021 and 2022, with assets under management swelling 58% from $2.4 trillion to $3.8 trillion.

But one of the principal drivers of that growth, fundraising, isn't projected to recover to recent highs until well after 2028.

VC firms are forecast to raise less than $200 billion in 2024, a 48% decline from 2021 levels. Fundraising is only expected to grow 2.9% annually through 2028, less than half the rate of other private capital strategies including private equity, private debt and real assets funds.

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The Daily Benchmark:
2016 Vintage North American Real Assets Funds

Median IRR

8.26%

Top Quartile IRR

10.96%

0.53x

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Kayne Private Energy Income Fund

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VC Deals

Holistic AI, a Paris-based generative AI startup, raised $200 million in debt and equity funding from investors including Accel, UiPath and solo investor Eric Schmidt, Bloomberg reported.

Monzo, a UK-based neobank, raised £150 million (about $190 million) in its latest round from investors including Hedosophia, CapitalG and GV.

Hysata, a green hydrogen startup based in Australia, raised a $111 million Series B led by BP and Templewater.

California-based biotech startup Attovia Therapeutics raised a $105 million Series B led by Goldman Sachs Alternatives.

Electric Hydrogen raised $100 million in corporate credit financing from HSBC.

DatologyAI, a Bay Area AI startup, raised a $46 million Series A led by Felicis Ventures.

Li Industries, a North Carolina-based climate-tech startup, raised a $36 million Series B led by Bosch Ventures, Khosla Ventures and LG Technology Ventures.

ArkeaBio, an agtech and biotech startup, raised a $26.5 million Series A led by Breakthrough Energy Ventures.

Dendra Systems, a UK-based provider of ecological restoration tools, has raised a $15.7 million Series B led by Zouk Capital.

PE Deals

Blackstone is the front-runner to acquire UK-listed music rights company Hipgnosis Songs Fund after rival suitor Concord said it will not match the firm's $1.6 billion bid, the Financial Times reported.

Apollo Global Management has secured $1.1 billion in debt financing led by Barclays and BNP Paribas to facilitate its buyout of US Silica Holdings, Bloomberg reported.

Sony Music Entertainment is competing against Blackstone and KKR in its bid to acquire Infocom, a Japanese manga company, for approximately 200 billion Japanese yen (about $1.3 billion), Bloomberg reported.

NB Capital Solutions led the recapitalization of FDH Aero, an aerospace supply chain company backed by Audax Private Equity.

Exits & IPOs

Who's Mailing What!, a formerly VC-backed direct mail platform, has been acquired by DirectMail2.0.

Aldrich Capital Partners has agreed to sell portfolio company Paymerang, a B2B payments automation provider, to NYSE-listed Corpay.

Indoor go-kart racing brand K1 Speed has acquired UK-based Capital Karts, which had previously received backing from Puma Private Equity.

Fundraising

Encap closed its Energy Transition Fund II on $1.5 billion to invest in low carbon fuels and renewable energy businesses.

Los Angeles-based Vance Street Capital held the final close of its Fund IV on its hard cap of $775 million.

Investcorp closed its fifth technology fund on $570 million, exceeding its $500 million target. The vehicle will seek controlling stakes in companies with around $10 million or more in revenue.

Romanian VC firm Early Game Ventures launched a €60 million fund targeted at tech startups in central and eastern Europe.

97212 Ventures, a New York-based VC firm focused on Israeli tech startups, closed on a $20 million fund aimed at establishing Israeli founders in New York City.

Chart of the Day

Source: Q1 2024 European PE Breakdown

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PitchBook News - VC fundraising's split forecast

Older messages

VC-backed companies narrowly guard valuations

A deal backlog in healthcare services

Private capital funds regain some footing

Forecasting growth for AUM

Emerging managers pull their weight

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