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The Daily Pitch: VC

June 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 find fintech investors haven't given up the hunt for the perfect budgeting app

Griffin's new gaming fund has a 33% smaller target than its predecessor, which was raised at the height of Web3 exuberance

IT startups make up 60% of all new unicorns in Q2

Bain's $5.6 billion PowerSchool acquisition may hint at a reacceleration of take-private deal sizes

Today's Top Stories

The never-ending search for the perfect budgeting app

After two leading personal financial management apps—Mint and Wesabe—ended up in the trash heap, some fintech investors may wonder if a consumer-focused budgeting app can make it.

But a few promising VC deals in the last couple of quarters have boosted expectations, according to our latest Emerging Tech Research. Among the standouts are Goalsetter, Ellevest and Cleo—and generative AI as well as the generational wealth transfer could supercharge their growth.

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Griffin Gaming Partners targets $500M for downsized fund III

(Flavia Morlachetti/Getty Images)

One of the most active VC gaming investors, Griffin Gaming Partners, is raising $500 million for its next flagship fund, according to filings. It's a downsize from the last time it raised capital in 2022, when it netted $750 million.

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IT is still king in this unicorn slump

Unicorn creation remains in line with recent trends after a surprisingly strong Q1, our global unicorn tracker shows. Only seven startups crossed the billion-dollar valuation mark in May for a total of 20 so far in Q2.

Information technology companies continue to lead the way, accounting for five of the seven newly minted unicorns in May. For the quarter, IT startups make up 60% of all new unicorns.

Healthcare unicorns also made a strong showing in May, with two Chinese startups crossing the vaunted threshold.

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Bain Capital to take PowerSchool private for $5.6B

(Ableimages/Getty Images)

Bain Capital has agreed to take PowerSchool private, valuing the edtech specialist at $5.6 billion.

The multibillion-dollar deal follows soon after Permira's $6.9 billion take-private of Squarespace, hinting at a possible reacceleration of take-private deal value after transaction sizes trended downward in the first quarter.

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Generalist fund managers beat specialists in returning cash to LPs

(Boy Wirat/Getty Images)

Specialist buyout B2B, IT and healthcare vehicles that historically benefited from their specialization saw a fall in distributions through 2023 compared to generalist vehicles.

Specialist vehicles saw distributions drop from the historical average of 23.2% to just 9.8%, and lagged behind generalist vehicles, which delivered 16.1% during the year.

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The AI safety movement is on the ropes

xAI CEO Elon Musk, OpenAI CEO Sam Altman and Alphabet CEO Sundar Pichai (Joey Schaffer/PitchBook News)

The dream of prioritizing AI safety is quickly fading. Leading model developers have seen safety experts scatter, competition heat up and public trust shatter through unforced errors.

OpenAI has installed a new safety team, one that includes CEO Sam Altman, after the old team jumped ship. Jan Leike, who previously led the ChatGPT maker's "superalignment" team with Ilya Sutskever, just landed at rival Anthropic.

But the challenges to AI safety go far beyond OpenAI's power struggles. Makers of large language models are finding they have no choice but to sideline long-term safety concerns as they put out fires and deal with competition.

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VC Deals

EnerVenue, a startup developing energy storage alternatives to lithium-ion batteries, has raised $308 million of a targeted $515 million, according to SEC filings.

Chinese aerospace startup Space Pioneer raised 1.5 billion yuan (around $207 million), according to reports.

Boston-based cybersecurity startup Seven AI raised $36 million from investors including Greylock, Spark Capital and CRV.

Indico Data, a Boston-based startup using AI to facilitate document workflows, raised a $19 million round led by .406 Ventures.

Seoul-based AI startup Wrtn Technologies has raised 25 billion South Korean won (around $18.3 million) in a round led by BRV Capital.

London's Qargo, the provider of a travel management system, closed an £11 million Series A led by Balderton Capital.

Microcaps, a Zurich-based developer of microencapsulation technology, secured a 9.3 million Swiss franc (around $10.5 million) Series A from investors including Helvetica Capital and Zürcher Kantonalbank.

PE Deals

Blackstone has acquired a 40% stake in Copeland after NYSE-listed Emerson sold its remaining interests in the company for around $3.5 billion.

My Yield, a company providing specialty treatment and support to the agriculture industry, has been acquired by Inverness Graham via a recapitalization.

Aymium, a cleantech specialist that produces products with biocarbon and biohydrogen, has raised $210 million from investors including ECP ForeStar and Copenhagen Infrastructure Partners.

London-based TDR Capital has acquired an additional 22.5% stake in UK-based supermarket operator Asda, boosting the firm's stake to 67.5%.

Exits & IPOs

PE-backed night vision goggle maker Exosens has raised €350 million in its Paris IPO, giving the French company a market cap of over €1.1 billion.

SoftBank-backed South Korean travel app developer Yanolja is seeking to raise $400 million in its upcoming US IPO, Bloomberg reported.

Alternative investment bank Aviditi Advisors will be acquired by Minneapolis-based Piper Sandler, a larger peer investment bank.

Carevive, a healthtech startup focused on cancer treatment, has been acquired by Nasdaq-listed Health Catalyst.

Sceptre Hospitality Resources, which offers a management platform for hotels, has been acquired by The Access Group.

Fundraising

Alphabet Inc.'s moonshot lab, X, is expected to launch a $500 million fund spearheaded by former YouTube and Facebook CFO Gideon Yu, Bloomberg reported.

Harlan Capital Partners has closed a $130 million fund targeted at companies in media, technology and specialty finance.

Copenhagen-based early-stage investor BlackWood Ventures has raised 110 million Danish kroner (around $16.1 million) in the second close of its debt fund.

Chart of the Day

Source: Q2 2024 Quantitative Perspectives Report

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PitchBook News - Can budgeting apps survive?

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