PitchBook News - AI keeps its grip on early-stage deals

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The Daily Pitch: VC

December 23, 2024

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Early-stage dealmaking is still all about AI

It's no surprise that AI and machine learning companies are dominating the early-stage VC funding landscape. For just angel, seed and early-stage VC deals in Q3 2024, AI specialists raised $2 billion across 42 pacts, according to our latest Emerging Tech Indicator report, suggesting continued investor confidence in the sector.

Since Q4 2023, early VC funding for the space has steadily increased—exemplified by a greater number of high deal values—and the trend remains even though total deal value declined in Q3 due to an oversized $6 billion deal in Q2.

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Ecommerce startups want to do away with wallets

VC funding for the ecommerce sector rose by over 50% in Q3, in part supported by more consumers fishing out their wallets to spend record amounts at retailers such as Amazon. But the latter may soon be a thing of the past as more startups create embedded digital wallets with AI integration, according to our latest Emerging Tech Research.

The ecommerce industry is being buoyed by the AI transformation, with startups creating services that can search for and purchase products seamlessly. Analyst Eric Bellomo highlights these startups and examines the broader trends driving the sector as dealmaking continues to stabilize.

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UK take-private deal value rebounds

(Chris J Ratcliffe/Getty Images)

The London Stock Exchange faces a critical turning point, with 88 companies delisting this year alone, including Just Eat Takeaway.

Private equity has seized the moment, fueling £16.5 billion (around $21 billion) in take-private deals—a 20% increase in total value over 2023, led by high-profile acquisitions such as Darktrace and Hargreaves Lansdown.

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Ranking PE's most active lenders

Twelve lenders took part in at least 50 deals each for US PE-backed companies in the third quarter, with the most active five tallying at least 60 apiece.

Which firms led the way? Explore our interactive Q3 2024 PE Lending League Tables, sponsored by TPG Twin Brook Capital Partners. Slice the data by deal type, geography, sector and more.

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Since yesterday, the PitchBook Platform added:

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VC valuations

372

People

138

Companies

13

Funds

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2015 Vintage Global Real Estate Funds

Median IRR

10.10%

Top Quartile IRR

14.95%

1.06x

Median DPI

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GreenOak Asia II

Blue Owl Capital Real Estate Capital Fund III

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VC Deals

Perplexity, the developer of an AI-powered search engine, raised a $500 million round led by Institutional Venture Partners at a $9 billion valuation, Bloomberg reported.

German home electrification startup 1Komma5 secured a €150 million round, boosting its funding to over €650 million as the company prepares for an IPO.

Anysphere, the developer of AI coding assistant Cursor, raised a $100 million Series B led by Thrive Capital that values the company at $2.6 billion.

Bolttech, a Singapore-based insurance tech startup, raised a $100 million Series C led by Dragon Fund at a $2.1 billion valuation.

Backflip, a startup building AI foundation models for 3D print design, secured a $30 million Series A from investors including Andreessen Horowitz and NEA.

Boon, which operates an AI logistics platform for fleet management, raised a $20.5 million round from Marathon, Redpoint and Soma Capital.

AI security startup Mindgard raised an $8 million round led by .406 Ventures.

Neverless, a crypto trading platform founded by former Revolut execs, secured $6.7 million in seed funding led by Lakestar and Connect Ventures.

PE Deals

Insight Partners is considering a sale of Boston-based Dotmatics, which makes research and development software. PE firms could be interested in acquiring the company, which could sell for over $5 billion, Bloomberg reported.

Business support services provider Williams Lea, which mostly works with legal and financial firms, has been acquired by RRD from Advent International.

Landmark Structures, a provider of water and industrial storage infrastructure, has been acquired by Cerberus Capital Management from Graycliff Partners.

Case Anywhere, developer of a cloud-based legal case management platform, has been acquired by Counsel Press, a portfolio company of Align Capital Partners.

Boston-based Inspired Health, which consults with pharmatech and medtech companies, has been acquired by West Monroe.

Variant Equity could acquire French network service provider Vantiva's supply chain solutions division for $40 million.

Inflexion invested in Mecenat, a Sweden-based consumer loyalty platform developer.

Lonsdale invested in Ireland-based dental corporate Total Dental Ireland.

Exits

EvolutionIQ, the developer of a platform for injury and disability claims management, has been acquired by Nasdaq-listed CCC Intelligent Solutions.

Diagnostic platform developer Sherlock Biosciences has been acquired by Nasdaq-listed OraSure Technologies.

The European Commission is investigating Liberty Media's planned $3.6 billion acquisition of Dorna Sports over concerns it could harm competition and raise broadcasting rights costs.

MidEuropa exited part of its stake in Mlinar, a bakery chain in Croatia, to Bosqar Invest.

Fundraising

Fifth Wall, a VC firm that invests in real estate tech startups, launched its latest fund targeted at $500 million in capital commitments.

New York-based Solari Capital is raising a $100 million fund, according to SEC filings.

Chart of the Day

Source: These mega-funds defied Europe's VC fundraising dip

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PitchBook News - AI keeps its grip on early-stage deals

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