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The Daily Pitch: VC

August 9, 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:

Agriculture drones help sow hope for agtech VC dealmaking

Can crypto and Web3 really help alleviate AI's soaring computing power costs?

After gains in Q2, SoftBank's Vision Funds are still hunting for AI bets

Europe's cleantech startups are on track for a record year thanks to several mega-deals

Today's Top Stories

Can crypto alleviate AI's computing crunch? Not so fast.

(Megan Woodard/PitchBook News)

Generative AI took the venture landscape by storm. Now, it may be dragging down startups and firms as costs soar for computing power.

But some investors think they've found the solution: bring Web3 and crypto to AI.

Decentralized GPU cloud startups, acting like rental marketplaces for unused computing power, are garnering attention and capital. But some are skeptical.

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Drones help keep agtech dealmaking aloft

VC dealmaking in the agtech industry has fallen below last year's levels—and our analysts project the $1.1 billion raised across 147 deals in Q2 2024 won't be enough to catch up this year. But some segments within the sector have seen less dramatic declines, including drones and imagery analytics.

Agriculture drones can be optimized for tasks such as health monitoring of livestock or crops, field mapping, and spraying, according to our latest Emerging Tech Research. They can also play a role in reducing costs and waste.

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SoftBank's Vision Funds gained in Q2, still hunting for AI bets

More than a year ago, SoftBank chief Masayoshi Son committed to shifting the firm to "offense" to go after AI opportunities. But the action remains quiet at the Japanese investor's tech-heavy Vision Fund unit.

SoftBank has committed $5 billion for strategic investments this year, emphasizing big bets on artificial intelligence. Those investments haven't come out of the Vision Fund unit's coffers. It was SoftBank Group, the Vision Fund's parent, that recently acquired AI chipmaker Graphcore and led a billion-dollar round for self-driving startup Wayve.

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3 charts: Tough times for venture newcomers as larger funds dominate

(Jordan Lye/Getty Images)

While global VC fundraising is on track for its worst performance in nearly 10 years, the pain isn't being felt equally. First-time and emerging managers are facing their worst environment since 2014, while capital continues to become more concentrated among an elite few.

Three charts from the latest PitchBook-NVCA Venture Monitor highlight the difficult landscape for VC newcomers.

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PE nears record year for European cleantech deals

(Justin Paget/Getty Images)

Cleantech, a sector which is typically more insulated from the macroeconomic environment, is on pace to set a dealmaking record this year in Europe.

However, deal count isn't catching up, with mega-deals accounting for much of the capital invested.

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How new NAV loan rules will actually impact LPs

(Chloe Ladwig/PitchBook News)

Everyone loves to talk about private equity's latest darling, the net asset value facility, so here's the latest chatter.

Late last month, the Institutional Limited Partners Association issued a set of guidelines to address what LPs identified as a lack of transparency into their fund managers' use of these loans. The lethargic dealmaking and exit environments have led to an increased use of these facilities to generate liquidity for fund investors.

But these guidelines are more about the future than the past.

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Since yesterday, the PitchBook Platform added:

10

VC valuations

2146

People

718

Companies

33

Funds

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The Daily Benchmark:
2019 Vintage Global Secondaries Funds

Median IRR

19.20%

Top Quartile IRR

25.18%

0.51x

Median DPI

Select top performers

Landmark Infrastructure Partners II

Banner Ridge Secondary Fund III

Blackstone Strategic Partners Secondaries VIII

*IRR: net of fees

16 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Anduril, the California-based defense tech startup, has raised a $1.5 billion Series F, bringing its valuation to $14 billion in a round co-led by Founders Fund and Sands Capital.

San Francisco-based FLYR, a travel and transportation technology startup, has raised $295 million in new funding led by WestCap, with participation from BlackRock and others.

UK-headquartered CloudPay, a payroll management startup, has raised $120 million in new funding led by Blue Owl Capital.

Mechanical Orchard, a San Francisco-based IT security startup, has raised a $50 million Series B led by GV.

Rewst, a Florida-based IT automation startup, has raised $45 million led by Sapphire Ventures.

New York-based Cents, which offers a management platform for laundry and garment care businesses, has raised a $40 million Series B led by Camber Creek and backed by Bessemer Venture Partners and Tiger Global.

Scimplify, an Indian specialty chemical manufacturing startup, received a $9.5 million Series A led by Omnivore.

VSParticle, a Dutch supplier of nanoparticle synthesis and deposition tools, raised €6.5 million in a round led by NordicNinja.

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PE Deals

Pershing Square is weighing a $3 billion take-private of real estate company Howard Hughes, the Financial Times reported.

Payroll and payments company CloudPay closed a $120 million funding round led by Blue Owl Capital.

TCG made a majority investment in real estate education platform provider BiggerPockets.

Blackstone will acquire a majority stake in Endurance Partners-backed engineering and consulting company Westwood Professional Services through Blackstone Energy Transition Partners.

PE-backed Gainsight, the developer of a customer relations management platform, purchased Staircase AI, a customer interactions analysis startup, for an undisclosed amount.

Exits & IPOs

Amelia, an enterprise conversational AI startup, was purchased for $80 million by Nasdaq-listed SoundHound AI.

Fundraising

Fidelity International is launching its first long-term asset fund to invest in PE, private credit, infrastructure, real estate and natural resources.

Africa Infrastructure Investment Managers raised $954 million for its fourth fund, including $206 million in co-investments. The fundraise exceeded its target by 50%.

Chart of the Day

Source: PitchBook's Unicorn Companies Tracker

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PitchBook News - Can crypto fix AI's computing crunch?

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