Does OpenAI's new model change the game?

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The Daily Pitch: VC

May 14, 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:

Analysts see a sunnier outlook for European VC valuations

OpenAI's GPT-4o could significantly alter the landscape of generative AI startups, investors say

SoftBank reports its second consecutive quarter of profit as it pivots to focus on AI

Today's Top Stories

'A total game changer': VCs see AI's future beyond text after GPT-4o launch

OpenAI CEO Sam Altman (Joey Schaffer/PitchBook News)

OpenAI just unveiled its latest flagship AI model, GPT-4o, and investors think it has the potential to alter the generative AI landscape.

With the model's heavy focus on speech and video, many are saying it could be a game changer. Some though, aren't convinced.

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Since yesterday, the PitchBook Platform added:

7

VC valuations

2216

People

635

Companies

26

Funds

See what our data software can do

The Daily Benchmark:
2013 Vintage Global Funds-of-Funds

Median IRR

15.68%

Top Quartile IRR

18.89%

1.08x

Median DPI

Select top performers

Glouston Ohio Midwest Fund II

Bay Hills Emerging Partners III

SwanCap Opportunities Fund I

*IRR: net of fees

54 Funds in Benchmark »

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People

Melinda Gates will resign as co-chair of the Bill & Melinda Gates Foundation in June after 24 years of leadership.

VC Deals

Indian ecommerce company Meesho has secured $275 million from investors, according to an SEC regulatory filing.

Lycia Therapeutics, a San Francisco-based biotech startup, raised a $106.6 million Series C led by Venrock Healthcare Capital Partners.

New York-based Ajax Therapeutics, a company developing treatments for blood cancers, raised a $95 million Series C led by Goldman Sachs Alternatives.

CereVasc, a Massachusetts-based medtech startup, raised a $70 million Series B led by Bain Capital Life Sciences and Perceptive Xontogeny Venture Fund.

MetisX, a South Korean semiconductor specialist, raised $44 million in its Series A from investors including LB Investment, Industrial Bank of Korea and STIC Ventures.

Foodtech startup Pepper, based in New York City, raised a $30 million Series B led by Iconiq Growth.

May Health, a Paris-based startup developing treatments for polycystic ovary syndrome, raised a $25 million Series B led by Bpifrance and Trill Impact.

French space-tech specialist Infinite Orbits raised €12 million in a round led by Newfund Capital.

London-based childcare company Tiney closed a £7.2 million Series A led by Mustard Seed Partners.

Pitchbook webinar series: The Allocator's Atlas

The Allocator's Atlas is a specialized webinar series designed for LPs, where you'll gain valuable insights and expert perspectives to effectively navigate your investment strategies and portfolio management.

In our inaugural webinar, a panel of PitchBook analysts will provide insights on how macroeconomic challenges have affected private capital returns, capital call and distribution rates across asset classes, and the cash flow J-curves of PE funds more specifically. Key topics include.

An update on our latest fund performance benchmarks and PitchBook Private Capital Indexes returns.

Analysis of cash flow patterns by asset classes and what has driven their volatility.

What J-curves of recent PE fund vintages across strategies and fund sizes look like today and their potential future trajectories.

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PE Deals

Blackstone is preparing to make a tender offer to acquire I'rom Group, a Japanese pharmaceuticals company, in a deal valuing the company at roughly 35 billion yen (about $218 million), including debt.

Kinetik agreed to buy Durango Permian, a natural gas provider and processor in the Delaware basin backed by Morgan Stanley Energy Partners.

Oil and gas conglomerate Idemitsu has invested $114 million in HIF Global, which manufactures carbon-neutral liquid eFuels.

Haveli Investments has acquired Nasdaq-listed cybersecurity firm ZeroFox.

CapVest-backed cocoa supplier Natra is in talks to acquire German chocolate company Gubor Schokoladen and Italian chocolate-spread company Nutkao, Bloomberg reported.

Don't miss our upcoming webinar

Though investors continue to wait for European M&A to recover, robust refinancing activity shaped last quarter into leveraged loans' best since 2021. Join our panel of credit market experts to explore the ongoing surge of institutional loan issuance, bonds and CLOs, along with what they expect for Q2 and the rest of 2024. Key topics include:

CLO issuance hits its second-highest quarterly volume in the 2.0 era—will the surge in new transactions continue?

Will the syndicated loan market continue to take share from the private credit market?

M&A is starting to return, but will refinancings continue to dominate deal flow for both loans and high-yield bonds?

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Exits & IPOs

Chinese fast-fashion giant Shein is ramping up its plans for a London listing after its attempt to go public in New York received pushback from regulators. Reuters reported that it plans to file with the London Stock Exchange as soon as this month.

Gridrion Capital is working with investment bank R. W. Baird to gauge interest in a $1.5 billion sale of Good Sportsman Marketing Outdoors, an outdoor sports gear seller, Reuters reported.

Reneo Pharmaceuticals agreed to merge with novel precision oncology medicines company OnKure. As part of the transaction, Reneo will receive $65 million in PIPE financing from investors including Acorn Bioventures, Cormorant Asset Management and Surveyor Capital.

Fundraising

London-based real estate investor Patron Capital closed its seventh flagship fund on €860 million, including over €200 million in discretionary co-investment capital.

Canadian firm Onex raised $735 million for a short-term buyout fund to invest in the upper middle market, Bloomberg reported.

Colorado-based growth equity firm NewVale Capital raised a $167 million fund to back pharmaceutical services providers.

Athens-based Apeiron Ventures has launched a €25 million fund that will target seed-stage startups in Europe.

Chart of the Day

Source: Q1 2024 US PE Breakdown

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Does OpenAI's new model change the game?

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