PitchBook News - Sequoia flagship's meaty markup

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The Daily Pitch: VC

November 22, 2024

Presented by Silicon Valley Bank

Today's Top Stories

Sequoia marks up flagship fund 25%

Sequoia Capital, one of the world's largest venture firms, marked up its 2020 flagship US venture fund by nearly 25% in the 12 months ended in June, according to a PitchBook analysis of a report by the Regents of the University of California, one of Sequoia's LPs.

The markups defy expectations for funds that deployed capital at the height of the 2020-2021 tech bull market and could be a sign of Sequoia's many AI bets paying off.

One caveat: The US Venture XVII fund hasn't returned any cash to LPs. Full story.

(Smith Collection/Gado)

Also...

👋 Accel-KKR marked its official entrance into the secondaries game. The tech-focused PE shop closed its AKKR Strategic Capital fund with over $2.2 billion in commitments, joining a long list of multi-billion-dollar secondaries funds that have closed over the past few years. Read more

🏛️ SEC Chair Gary Gensler will resign when Donald Trump takes office on Jan. 20, opening the door for the president-elect to name a replacement.

Medtech’s VC exits get a clean bill of health

(Julia Midkiff/PitchBook News)

Exits in Medtech picked up in Q3 after a slow, tough period. The number of acquisitions has also seen a rise, with companies like Endomag and Paragonix getting bought for more than $100 million. The quarter also saw the largest VC deal to date, Element Biosciences $277 million Series D, in July. And despite a dip in Q3, deal flow is still on track to surpass 2023’s figure by 17%.

PitchBook’s latest Emerging Tech Research lays out what’s next for the vertical. Touching on the trends and segments generating excitement and capital, the Q3 Medtech Report also examines companies experimenting with smart implant and wound care technology, two areas seeing a wave of investment.

Read the report

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A message from Silicon Valley Bank

Fintechs navigate headwinds, AI offers reasons for optimism

SVB's new Future of Fintech 2024 report reveals a fintech sector that's cutting costs and finding opportunities in generative AI while managing headwinds from higher interest rates and heightened regulatory oversight and security concerns. A nearly 80% improvement in year-over-year EBITDA margins demonstrates how founders remain laser-focused on efficiency.

The report shows that VC investment remains muted, hovering near a six-year low for the sector, as deal flow has shifted toward the early stage, with more than three seed deals for every one Series A. AI is also emerging as a bright spot for the industry as investors and founders explore its growing role in the sector.

Access the full report to gain exclusive insights, data-driven analysis and expert commentary on the future of fintech.

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6 charts: Market conditions continue to fuel European VC valuations recovery

(We Are/Getty Images)

European venture capital is regaining momentum, with pre-seed and seed-stage valuations showing significant growth through Q3 2024.

Fintech remains the frontrunner, boasting the highest median valuations across all stages, while AI valuations struggle to keep pace.

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The Daily Benchmark:
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People

HSBC Innovation Banking has picked Emily Turner, Citi's former head of business development, as its new CEO.

VC Deals

Lighthouse, a London-based commercial intelligence platform for the travel & hospitality industry, secured a $370 million Series C led by KKR.

Enveda, a Boulder-based biotech startup specializing in using AI to develop new medicines, raised a $130 million Series C led by Kinnevik and FPV

Pickle Robot Company a startup based in Cambridge, Mass., developing AI-driven autonomous robotic systems, has raised a $50 million Series B from Toyota Ventures, Teradyne Robotics Ventures, Ranpak and others.

Cambridge, Mass.,-based Lightning AI, an AI infrastructure and development tool, has secured $50 million in new funding from Cisco Investments, Nvidia, JP Morgan and others.

Colorado-based Iontra, a battery charging technology startup, has raised a $45 million Series C led by Volta Energy Technologies.

Inversion, a Los Angeles-based space-tech startup focusing on precision delivery, has raised a $44 million Series A co-led by Spark Capital and Adjacent.

Magma Math, a New York-based K-12 instructional math platform startup, has raised a $40 million Series A led by Five Elms Capital.

Monkey Tilt, a Las Vegas-based online entertainment and gambling platform, has raised a $30 million Series A led by Pantera Capital.

PE Deals

Manufacturing and industrial investor Saothair Capital Partners bought Pioneer Window Holdings, a company that specializes in aluminum and glass facade systems.

Middle-market firm Quad-C Management staked Flow Service Partners, a company that provides heating, ventilation, air conditioning and refrigeration services.

Toscafund and Penta Capital invested $30 million in CellPoint Digital, which provides fintech software for the airline and travel industries.

General Atlantic has invested in Technosylva, a company that provides wildfire risk-mitigation solutions.

Silfab Solar has secured $100 million in new financing, with $50 million from ARC Financial Corporation.

Sunstone Partners, has made a strategic investment in KMS Technology. The company offers software development, testing services and technology consulting.

Lancium, develops software and tech for large-scale data centers, has received over $500 million from Blackstone, Bloomberg reported.

Bain Capital has provided capital to strategically integrate BW Fusion, Biodyne and Agronomy 365 as one crop-nutrition platform under BW Fusion.

Exits

Kioxia, a Japanese memory chip-maker backed by Bain Capital, is planning an IPO in the Tokyo Stock Exchange at a $4.8 billion valuation, Reuters reported.

HIG exited Deenova, an Italy-based specialist in traceability of drugs and medical devices, to Ersel Asset Management SGR and Amundi Private Equity Italia.

Mews, a hospitality technology company, is acquiring revenue management software startup Atomize for an undisclosed amount.

The cybersecurity giant Wiz is buying Dazz, a risk management and remediation startup, for $450 million.

Serent Capital has exited KORE to Two Circles, a data marketing company specializing in global sports and entertainment businesses.

Fundraising

Hong Kong-based Trustar Capital raised $1 billion for a continuation fund to hold the controlling stake in McDonald Corp’s China and Hong Kong operations, Reuters reported.

Italian PE firm Quadrivio Group is looking to raise €300 million for its Artificial Intelligence PE Fund to invest in SMEs in the B2B sector.

Zürcher Kantonalbank Asset Management held the final close of Swisscanto Fund Private Equity World Carbon Solutions at $150 million.

Blue Bear Capital has raised $160 million for its third flagship fund focused on bringing AI technology to sustainable energy production.

Neos Partners closed Neos Partners II at $1.37 billion, alongside a $350 million co-investment. The fund focuses on energy transition and crucial infrastructure sectors.

Chart of the Day

Source: Q3 2024 Healthcare Services PE Update

Correction

In an article from yesterday's newsletter, ring-maker Oura’s valuation jumped over 100% from its last round, not 50%.

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PitchBook News - Sequoia flagship's meaty markup

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