PitchBook News - Forerunner notches $500M tech VC fund

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The Daily Pitch: VC

November 12, 2024

Presented by Golub Growth

Today's Top Stories

Private market pros await bumps in comp

Following years of stagnant Wall Street bonuses, private equity and private credit professionals are expected to see end-of-year bonuses increase by 5% and 10%, respectively.

Investment banking debt underwriters could be truly in the money with cash bonuses and equity awards expected to surge by 25% to 35%, data from a compensation consulting firm shows. Jessica Hamlin tells us what's behind these numbers and how asset managers are placing greater emphasis on performance-related payouts. Learn more.

Also…

🧳 Forerunner Ventures, which backed pre-pandemic direct-to-consumer stars like Warby Parker, Away and Glossier, has closed its seventh flagship fund on $500 million. It sends a strong signal that confidence in the consumer sector, which had fallen out of VCs' favor in the last two years, could be back on the rise. Story here.

💸 Do falling interest rates lead to higher PE returns? According to PitchBook's Q4 2024 Quantitative Perspectives report, lower rates may stir up competition for deals and drive up valuation multiples, potentially neutralizing the benefits of lower debt costs to financial buyers. Get the report.

Lower-mid-market PE firm quickly captures $675M

(Anton Petrus/Getty Images)

Godspeed Capital Management, a lower-middle-market PE firm investing in the defense and government sector, raised $675 million in less than two months for its third buyout fund.

Investments in the sector benefit from a few tailwinds, including increased government spending on defense and the modernization of government infrastructure.

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Food and beverage dealmaking keeps its momentum in Q3

The food and beverage consumer packaged goods industry has shown resilience in the first three quarters of 2024 despite economic headwinds—reaching an estimated 385 PE deals compared to 2021's peak of 531, according to our recent report on the sector.

The momentum has primarily been fueled by robust dealmaking in alcohol, baked goods and celebrity brands, with a notable shift toward smaller deals and growth rounds rather than large acquisitions. Firms continue to build on existing platforms through add-on deals.

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Carbon tech's next big things: soil, seaweed and bioreactors

While the carbon-tech sector saw only a slight quarterly decline in funding in Q3, alarm bells are ringing over the more than 73% drop in total deal value year-over-year.

Despite the plunge—relative to Q3 2023's record haul and outsized rounds—startups using biological methods to remove carbon emissions are recapturing investors' attention, according to our recent Emerging Tech Research. Companies focusing on the use of phytoplankton and smarter soil saw total funding in that space rise $178 million.

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Since yesterday, the PitchBook Platform added:

1885

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754

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The Daily Benchmark:
2015 Vintage Global Debt Funds

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8.30%

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AAVIN Mezzanine Fund

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ICG Europe Fund VI

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89 Funds in Benchmark »

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VC Deals

Ualá, an Argentina-based fintech startup, raised a $300 million Series E led by Allianz X. The company was valued at $2.75 billion.

Cloud cybersecurity startup Upwind, based in Israel, is raising a $100 million round from investors including Craft Ventures, Greylock, CyberStarts and others, TechCrunch reported.

ZAP Surgical Systems, which develops robotics for non-invasive brain surgery, raised a $78 million Series E led by Qingdao Baheal Medical.

Riyadh-based Lean Technologies, which develops a fintech infrastructure platform, raised a $67.5 million Series B led by General Catalyst.

Satispay, a Milan-based mobile payments startup, raised €60 million from investors including Addition, Greyhound Capital and Lightrock.

AI sales bot developer 11x, based in San Francisco, raised a $50 million Series B led by Andreessen Horowitz.

Northflank, a London-based workload platform for developers, secured $22.3 million from investors including Bain Capital Ventures and Vertex Ventures US.

Cogna, a London-based AI software provider, closed a $15 million Series A led by Notion Capital.

Onboarding and payroll automation platform developer Tako, based in São Paulo, raised a $13.2 million seed round led by Ribbit Capital and Andreessen Horowitz, TechCrunch reported.

PE Deals

Goldman Sachs Alternatives has agreed to acquire HVAC specialist Sila Services from Morgan Stanley Investment Management.

Thoma Bravo has sold a minority stake in Qlik, a Pennsylvania-based data integration and analytics specialist, to a subsidiary of Abu Dhabi Investment Authority.

Blackstone is in talks to acquire a minority stake in New York-based firm American Industrial Partners, Bloomberg reported.

Luxembourg-based Triton Partners is considering a potential buyout of Evotec, a drug discovery specialist, Bloomberg reported.

Genesis Capital raised its bid for Australian dental chain Pacific Smiles to $208 million.

Exits & IPOs

Genetic Group, an Italy-based medical device contract manufacturer, is in talks to be sold by owner CVC Capital Partners in a deal that could value the company around €700 million, The Financial Times reported.

Australia-based HMC Capital is filing an IPO for its data center business, DigiCo Real Estate Investment Trust, which is valued at about AUD $4 billion ($2.64 billion).

Fonterra Cooperative Group, an exporter of dairy products, is considering an IPO of its consumer business. The company could raise about $1.8 billion.

Zetwerk, an India-based supply chain services provider, is aiming to raise $1 billion in a potential Mumbai IPO, Bloomberg reported.

Boxer, a South Africa-based discount retailer owned by Pick n Pay Stores, is seeking to raise 8 billion rand ($449 million) in a Johannesburg IPO.

Key trends shaping the future of Impact and ESG

Our fifth annual Sustainable Investment Survey reveals a compelling shift in the investment landscape: Despite the controversies surrounding ESG and Impact, practitioners are not just adapting but innovating. With insights from over 1,000 global respondents, including asset owners, VCs and family offices, this survey uncovers the strategies and motivations driving ESG and Impact practitioners. We also delve into the perspectives of those who have opted not to incorporate ESG into their investment programs, shedding light on their rationale and decision-making processes.

Our Sustainable Investment Survey is just one of many ESG and Impact research efforts we provide to help investors create a double bottom line of financial returns and positive social or environmental impact. PitchBook Research helps our customers navigate complexity across the entire investment cycle, including contextualizing sustained trends in evolving spaces such as ESG.

Download our report.

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Fundraising

California-based middle market PE firm Transom Capital raised $675 million at the close of its fourth fund, Transom Capital Fund IV, and $79.5 million in other capital commitments.

Investors

Canadian investment managers Davis Rea and GlobeInvest Capital Management will merge to create a new asset management firm based in Toronto.

Corporate M&A

Health insurance provider Cigna will not merge with fellow insurance company Humana. Merger talks have been ongoing since last year.

Chart of the Day

Source: PitchBook Analyst Note: Infrastructure Funds Fuel the Energy Transition

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PitchBook News - Forerunner notches $500M tech VC fund

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