PitchBook News - PE's rep at risk in healthcare roll-ups

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The Daily Pitch: VC

May 21, 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:

France and its mixed 2024 bag are the spotlight for our latest Private Capital Breakdown

Thoma Bravo exits cybersecurity company Venafi to Nasdaq-listed CyberArk

Our Healthcare Services Report covers recent PE trends in the industry

Today's Top Stories

Healthcare services deals stick in the pipeline

All eyes are on healthcare consolidation following the FTC's announcement of an "inquiry on impact of corporate greed in healthcare" in March. While lead analyst Rebecca Springer thinks the likelihood of direct antitrust enforcement in the lower and core middle market remains low, the attention could permanently affect PE's reputation among potential sellers and partners in the provider landscape.

Our recent industry research unpacks recent PE trends in healthcare services. The report also highlights the backlog of physician practice management platforms needing an exit and the complex market dynamics facing sponsors entering the continuous glucose monitor distribution market.

read the report

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Mixed start for France's private markets

It has been a rough 2024 for French private capital, but the declines have been mitigated by comparatively stronger VC exits and a robust PE fundraising market.

VC dealmaking was down in Q1, tracking 17% below Q1 2023, according to our 2024 France Private Capital Breakdown. Exit activity was also down—but not to the extent seen elsewhere in Europe. There was also a decline in PE activity, yet the fundraising pipeline is healthy: In 2023, France recorded a 27.8% increase in PE fundraising over 2022.

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Female founder momentum slowed in April

VC activity for US female founders is off to a muted start in Q2. Just $2.3 billion worth of deals closed in April after female founders set a one-year high in Q1 with $10.5 billion raised, our female founders dashboard shows.

Startups with at least one female founder garnered $12.8 billion over 961 deals through the first four months of 2024.

Notable deals in April included a nearly $225 million Series A for cryptocurrency platform developer Monad Labs, co-founded by COO Eunice Giarta, and a $20.8 million Series B for vegan snacks producer Partake Foods, founded by CEO Denise Woodard.

explore the dashboard

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Meet the most active VCs in Latin American startups

(Marco Bottigelli/Getty Images)

Investment in Latin American startups has cooled after a period of explosive growth. But high-profile investments, particularly in fintech, signal that VCs remain committed to the digital transformation in a region of over 600 million people.

We looked at the 10 most active investors in Latin American startups.

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Since yesterday, the PitchBook Platform added:

9

VC valuations

594

People

215

Companies

14

Funds

See what our data software can do

The Daily Benchmark: 2019 Vintage Global PE Funds between $500M-$1B

Median IRR

15.00%

Top Quartile IRR

28.26%

0.18x

Median DPI

Select top performers

Sterling Investment Partners IV

Charlesbank Technology Opportunities Fund

Falfurrias Capital Partners IV

*IRR: net of fees

36 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

California-based defense-tech startup Anduril is in talks to raise a $1.5 billion round at a valuation of at least $12.5 billion, The Information reported. The company was last valued at $8.5 billion in 2022.

Progentos Therapeutics, a new Massachusetts-based biotech startup, raised a $65 million Series A led by Forbion. Progentos CEO Christopher Loose previously founded Frequency Therapeutics.

280 Earth, a startup producing direct air carbon capture technology based in the Bay Area, raised a $50 million Series B led by Builders VC.

Neros Technologies, a defense-tech company developing autonomous drones to sell to Ukraine, raised a $10.9 million seed round led by Sequoia.

Seattle-based Overland AI, a startup developing AI-powered military vehicles, raised a $10 million seed led by Point72 Ventures.

Healthcare platform startup Hamilton Health Box raised a $10 million Series A led by 1588 Ventures.

PE Deals

EQT is in advanced talks to buy Keyword Studios, a UK-listed video game services company, for around £2.2 billion, the Financial Times reported.

The Carlyle Group will make an offer for KFC Holdings Japan, the Tokyo-listed operator of KFC restaurants in Japan. The offer values the company at around 130 billion Japanese yen (roughly $835 million).

Alicorn Venture Partners will acquire Tel Aviv-listed software developer Glassbox for about $150 million.

Warburg Pincus and Bain Capital have both indicated interest in a takeover of NYSE-listed PowerSchool, an education software provider, according to reports.

Canadian PE firm Clairvest Group, together with ECL Entertainment, acquired horse racing and betting operator Wyoming Downs.

Encore Consumer Capital acquired Sacramento-based Chalet Desserts, a frozen baked goods company.

Portfolio Companies

CoreWeave, a cloud computing software provider, secured $7.5 billion in debt financing led by Blackstone. The company raised a $1.1 billion Series C on May 1, which reportedly put it at a post-valuation of $19.1 billion.

VC-backed UK challenger bank Revolut has plans to coordinate a secondary share sale worth $500 million, Sky News reported. The sale will not raise new capital but would allow employees to cash in on their stock.

Seattle-based recruiting-tech startup SeekOut has laid off about 30% of its employees, TechCrunch reported. The company was last valued at $1.2 billion in its Series C led by Tiger Global in early 2022.

Exits & IPOs

Quadrant Private Equity is preparing to sell Darrell Lea, an Australian chocolate and licorice maker, the Australian Financial Review reported.

Helios Life Enterprises, a startup developing voice analysis software, has been acquired by Markets EQ.

Fundraising

RedBird Capital Partners closed its fourth flagship fund on $4.7 billion, The Wall Street Journal reported. The PE firm invests in sports and entertainment and holds a majority stake in soccer team AC Milan.

Asia-focused firm PAG reached a $550 million close of its first renewable energy-focused fund.

New York-based VC firm Valar Ventures launched a new fund targeting $300 million. Valar was co-founded in 2010 by billionaire Peter Thiel and is a specialist fintech investor.

London's Openseed VC reach a first close of $10 million for its latest fund, which will back pre-seed startups in Europe and Africa, TechCrunch reported.

Corporate M&A

Yandex NV, the Dutch parent company of Russian tech giant Yandex, has completed the first phase of a $5.2 billion deal to sell the business to a Russian investor group. Yandex NV's stake in the business is now reduced to 28%.

Chart of the Day

Source: Q1 2024 Global M&A Report

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PitchBook News - PE's rep at risk in healthcare roll-ups

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