PitchBook News - LPs power the energy transition

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The Daily Pitch: VC

October 29, 2024

Presented by SVB

Today's Top Stories

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Evergreen funds are taking root in the secondaries market.

Open-ended vehicles, which allow LPs to more easily withdraw funds, could soon account for a third of all AUM in the asset class. The trend aligns with a broader shift toward evergreen fund structures in the private markets.

Emily Lai reports that the increasing popularity of these vehicles comes amid growing demand for liquidity as GPs tap into the $450 trillion private wealth channel. Full story

🎓 Yale's endowment reported some of the weakest annual investment performance in the Ivy League. The endowment, whose private markets-heavy allocation is known as the "Yale model," saw a 5.7% investment return in the latest fiscal year. A lack of exits has battered its recent returns.

🔒 Cybersecurity startup Armis is worth $4.2 billion and has an IPO on the brain. The company raised a $200 million Series D led by General Catalyst and Alkeon to build its risk management platform. The fresh cash could help it continue an M&A streak.

Energy transition infrastructure specialists raise $215B since 2014

LPs have committed $892 billion to infrastructure funds engaging in some degree of energy transition investment since 2014, nearly a quarter of which has gone to specialist funds, PitchBook's Anikka Villegas reports in our latest analyst note.

Fund performance has improved over time, thanks both to government support and better technology.

Specialist funds have proliferated as LPs seek out specific exposure, driven in part by stakeholder pressure.

Future returns will benefit from increased energy demand, continued government support and the low cost of operating renewable energy infrastructure.

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Dealmaking struggles, but bright spots emerge for Europe's VC market

European VC dealmaking is set for another year of decline, with deal value projected to come in 9.7% below 2023's annual total. Venture growth has been the most resilient stage, accounting for over half of Q3's top 10 deals, according to our Q3 2024 European Venture Report, sponsored by J.P. Morgan.

AI is a highlight for Europe's VC dealmaking, with total deal value pacing 24% above 2023. SaaS and life sciences are also performing well this year. Recovery is finally on the horizon for the exit markets, and higher valuations are being commanded for public listings.

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Q&A: Morgan Stanley strategy co-chief on unlocking value in tactical funds

(AntonioSolano/Getty Images)

Morgan Stanley's Tom Cahill sat down with PitchBook to discuss the rationale behind launching the Tactical Value Fund series, emphasizing its flexible approach to capital deployment in response to evolving market needs.

By combining elements of both debt and equity, the strategy aims to offer tailored solutions that address complex financing challenges for companies while providing significant upside potential for investors.

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Since yesterday, the PitchBook Platform added:

2393

People

924

Companies

40

Funds

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The Daily Benchmark:
2018 Vintage Global Real Estate Funds

Median IRR

10.00%

Top Quartile IRR

15.97%

0.4x

Median DPI

Select top performers

Exeter Europe Value Ventures III

Clairmont GP Fund III

Invesco Strategic Opportunities III

*IRR: net of fees

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VC Deals

Sierra, the AI startup founded by former co-CEO of Salesforce Bret Taylor, raised a $175 million round led by Greenoaks Capital Partners. The round values Sierra at $4.5 billion.

Kivu Bioscience, a San Francisco-based biotech startup focused on oncology, raised a $92 million Series A led by Novo Holdings.

Filigran, a Paris-based threat intelligence company, received a $35 million Series B led by Insight Partners.

New York-based Reflexivity, which develops AI solutions for investors, raised a $30 million Series B led by Greycroft and Interactive Brokers.

Beyond Aero, a France-based startup developing hydrogen-powered private jets, raised a $20 million Series A led by Giant Ventures and Bpifrance, The Wall Street Journal reported.

Fintech startup Wildfire Systems raised a $16 million Series B led by Intuit Ventures and Mucker Capital.

Data security and analytics startup Abstract Security raised a $15 million Series A led by Munich Re Ventures.

Salt Lake City-based B2B SaaS company Voze raised a $12 million Series A led by Mercury Fund and Origin Ventures.

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PE Deals

A consortium led by Fortress Investment Group and BlackRock is considering a bid for German life insurance consolidator Viridium Group, which could be valued at around €3 billion, Bloomberg reported.

EQT is in talks to sell a minority stake in its interstate natural gas pipelines to Blackstone in a $3.5 billion deal, Reuters reported.

Permira is acquiring a minority stake in French outdoor clothing brand K-way.

NorthEdge invested in UK-based PebblePad, which offers an online learning platform for universities.

DigitalBridge acquired British data center developer Yondr Group.

Texas-based STAT Specialty Hospital has been acquired by PE firm ZT Corporate. The acquisition includes three hospitals and an emergency center.

Kinney Group, a company creating a platform that uses machine data in security and IT operations, has been acquired by Clayton Dubilier & Rice-backed Presidio.

Portfolio Companies

Chrysalis Investments upped the value of its stake in Klarna to £120.6 million, implying a $14.6 billion valuation for the fintech company, Bloomberg reported.

Independent music rights company Concord Music raised $850 million in an asset-backed securitization led by Apollo Global Management.

Exits & IPOs

Crypto specialist Bitpanda, backed by Valar Ventures, is considering a sale or IPO that could value the company at over $4 billion, Bloomberg reported.

Swiggy, an Indian food delivery specialist, started selling shares at up to 390 rupees each (about $4.64), in an IPO aiming to raise $1.35 billion, Bloomberg reported.

Chemical formulator AOC has agreed to be acquired by Japan-based Nippon Paint Holdings for $2.3 billion.

Aliada Therapeutics, a biotech company that develops therapies for Alzheimer's disease, has been acquired by NYSE-listed AbbVie.

Fundraising

TPG raised almost $5 billion for TPG Rise Climate II.

Adams Street Partners raised $1.1 billion at the close of its 2024 Global Fund Program.

LGT Capital Partners beat its target to hold the final close of Crown Europe Small Buyouts VI on €750 million.

Vendis Capital has collected €500 million for Vendis IV so far, beating its initial target of €450 million. The fund is expected to close on its €525 million hard cap before the end of the year.

VinVentures, VC arm of Vietnam-based Vingroup, launched a fund targeted at $150 million to invest in Southeast Asian tech startups.

Investors

General Atlantic, based in New York, will open an office in Riyadh, Saudi Arabia, to target more businesses in the Middle East.

Saudi Arabia-based Wa'ed Ventures, the VC arm of Aramco, plans to invest $100 million into AI technology startups.

Chart of the Day

Source: Q3 2024 European Venture Report

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PitchBook News - LPs power the energy transition

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