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The Daily Pitch: VC

May 24, 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:

Only one category in the AI market has been a reliable producer of VC-backed exits: hardware acceleration

A look at PE's largest Japan-focused buyout funds of recent years

Our Q1 2024 Gaming Report maps VC trends and emerging opportunities in the space

Today's Top Stories

Hardware acceleration drives VC returns in AI

Investors are scattering bets widely in the AI market, but only one category has been a reliable producer of exits for VC-backed companies, our latest Emerging Tech Research explains.

The IPO of Astera Labs, which makes AI hardware for data centers, continued that trend in the first quarter with a towering revenue multiple. That debut followed last year's blockbuster IPO of semiconductor specialist Arm. And there's more to come: Chipmaker Cerebras, last valued at $4 billion, is readying an IPO.

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PE giants double down on Japan

(Spawns/Getty Images)

Japan's market is heating up as PE managers continue to grow their presence in the region. Now, The Carlyle Group has raised roughly $2.8 billion for its fifth Japanese buyout fund.

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Dealmakers await their NFL kickoff

(Jenna O'Malley/PitchBook News)

Senior reporter Jessica Hamlin has been paying close attention to the NFL in recent months.

She's heard rumblings about fund managers preparing for a final call on a decision that stands between institutional investors and exposure to some of the most profitable sports franchises in the US.

The expected NFL ruling would allow firms like Arctos and RedBird Capital—two of the most prominent private firms with sports strategies—to acquire minority yet hefty chunks of NFL teams.

This article originally appeared in our Capital Pool newsletter. Subscribe to the newsletter here.

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Since yesterday, the PitchBook Platform added:

7

VC valuations

1732

People

664

Companies

35

Funds

See what our data software can do

The Daily Benchmark:
2020 Vintage Global Funds-of-Funds

Median IRR

9.40%

Top Quartile IRR

14.71%

0.05x

Median DPI

Select top performers

Spectra Investments III

Weathergage Capital Investments 2016

Glouston Ohio Midwest Fund III

*IRR: net of fees

45 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Stockholm-based textile recycling company Syre raised $100 million in a Series A led by TPG Rise Climate.

AI chip developer EnCharge AI, based in the Bay Area, is seeking at least $70 million from investors, Bloomberg reported. The company is backed by the US Defense Advanced Research Projects Agency.

Enifer, a Finnish company that produces fungi-based protein ingredients for the food industry, raised €36 million. The funding comprises a €15 million Series B and €9 million in debt, adding to an earlier €12 million investment grant from Business Finland.

Lumos, a San Francisco-based startup centralizing workplace management software, raised a $35 million Series B led by Scale Venture Partners.

Atropos Health, which uses generative AI to provide personalized healthcare data, raised a $33 million Series B led by Valtruis.

New York-based Cover Whale, a fintech startup specializing in auto insurance, raised $27.5 million in debt and equity from Morgan Stanley Expansion Capital.

Patronus AI, which is working to enhance security and reliability in large language models, raised a $17 million Series A led by Notable Capital.

XSquare, a Singapore-based startup that offers automated warehouse solutions, has raised S$10.5 million (about $7.8 million) in a Series A led by Wavemaker Partners.

PE Deals

KPS Capital Partners has agreed to purchase Tate & Lyle's remaining ownership interest in plant-based food producer Primient for $350 million.

NYSE-listed wealth management software company Envestnet is attracting takeover interest from Advent International and GTCR, Bloomberg reported.

London-listed financial services company Hargreaves Lansdown rejected a £4.67 billion takeover offer from a consortium including CVC Capital Partners, Nordic Capital and an Abu Dhabi Investment Authority subsidiary.

Beijing-based Centurium Capital is considering bringing new backers into Chinese coffee chain Luckin Coffee through a continuation fund, Bloomberg reported.

Indie films company Anton secured €100 million from BlackRock to boost its commercial European film projects.

FPE Capital acquired Vanda Research, which provides data and research to institutional capital markets investors. The deal is FPE's sixth investment out of its third fund which raised £185 million in 2022.

Exits & IPOs

Sandberg Capital is selling its 100% stake in Slovakian web hosting company Webglobe to Group.one, a cloud and hosting services company based in Sweden.

The Carlyle Group has exited the entirety of its minority stake in publicly listed Rede D'Or, a Brazilian hospital chain, for roughly 2.2 billion reais (around $426.9 million).

Texas-based Firefly Aerospace, a startup developing orbital launch technology, is exploring a sale after a late-2023 valuation of $1.5 billion.

Global Thermostat, a Colorado-based startup specializing in direct air capture technology, has been acquired by Zero Carbon Systems.

Fundraising

Dallas-based buyout firm Paceline Equity Partners has closed on $780 million for its second opportunity fund, AltAssets reported.

London-based PE house Permira is targeting €750 million for its new private credit fund, Strategic Opportunities I, The Wall Street Journal reported.

Indianapolis-based Elevate Ventures has partnered with the state of Indiana to launch a fund targeting $100 million.

Chart of the Day

Source: Q3 2023 Global Fund Performance Report (with preliminary Q4 2023 data)

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PitchBook News - What drives VC returns in AI

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