PitchBook News - VC valuations feel the pressure

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The Daily Pitch: VC

February 28, 2025

Presented by CIBC Innovation Banking

🌡️ VC investment in AI shattered a record in Q4—but that doesn't mean it's all smooth sailing from here. Our latest Emerging Tech Research pulls the curtain back on the handful of mega-deals behind the record and the disruptions already shaking up the sector in 2025. Read more

👷 Natural disasters and housing woes could spur PE deals in the building products industries. Over half of PE-backed companies in the space have been held for more than five years, creating pressure for exits in an industry already primed for consolidation. Full story

Plus...
• Despite flop, Kindred Ventures' Steve Jang sees a future for AI wearables

Why US startups hit a decade high for flat, down rounds

(Jenna O'Malley/PitchBook News)

Turns out 2021's VC boom is still haunting US startups now raising fresh funding rounds. Valuations remained so inflated, according to a PitchBook report, that flat and down rounds hit a 10-year high in 2024, accounting for 25% of all rounds last year.

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Despite flop, Kindred Ventures' Steve Jang sees future for AI wearables

The Humane AI pin on display in 2024.
(NurPhoto/NurPhoto via Getty Images)

Humane's wearable AI pin promised it was the future of consumer tech—until the story ended in an asset sale.

But one of its biggest backers, Kindred Ventures managing partner Steve Jang, doesn't seem to have been put off by the disappointing exit. Jang still sees mainstream consumer applications of AI as the biggest investment opportunity this year. He's not alone.

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Firm consolidation prices out GP stakes PE investors

(Erik McGregor/Getty Images)

PE managers in the US bought more asset managers in 2024 than they have in private market history. But their rapid acquisitiveness is crowding out the GP stakes market.

The majority of the transactions were controlling, strategic stakes in other firms, meaning the acquirer used capital from its own balance sheet to purchase the business, according to PitchBook's Q4 2024 US Public PE and GP Deal Roundup report.

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State Street, Apollo launch private credit ETF

(OsakaWayne Studios/Getty Images)

State Street Global Advisors and Apollo Global Securities have launched a highly anticipated private credit exchange-traded fund, offering retail investors exposure to high-yielding but risk-laden private debt.

SPDR SSGA Apollo IG Public & Private Credit ETF opened for trading Thursday with $50 million in AUM managed by State Street's SSGA Active Fixed Income Team.

In September, the State Street/Apollo fund became the first publicly announced private credit ETF venture. Since then, two other firms have launched fixed-income CLO ETFs with private credit exposure.

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Since yesterday, the PitchBook Platform added:

19

VC valuations

2393

People

554

Companies

36

Funds

See what our data software can do

The Daily Benchmark:
2021 Vintage Non-US PE Funds

Median IRR

7.28%

Top Quartile IRR

19.60%

0.01x

Median DPI

Select top performers

Hg Titan 1

CapVest Equity Partners V

H.I.G. Europe Capital Partners III

*IRR: net of fees

52 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

People

Blackstone has hired Rodney Zemmel, a former executive at McKinsey & Company, as global head of portfolio operations.

VC Deals

Payments giant Stripe secured a $91.5 billion valuation after finalizing its latest share sale, up from its last valuation of $70 billion in 2024.

Cross-border payments company Nala, based in Tanzania, aims to raise up to $120 million in an upcoming round, Bloomberg reported.

SoftBank's Vision Fund, Liberty Strategic Capital, All Blue Capital and Andra Capital are in talks to invest $100 million into cybersecurity startup Cybereason, Bloomberg reported.

Ecommerce software developer Shop Circle, which is based in London, raised a $60 million Series B led by Nextalia Ventures.

Taktile, a startup developing AI to help banks and fintech companies make risk decisions, raised a $54 million Series B led by Balderton Capital.

Mimic, the developer of a ransomware detection platform, raised a $50 million Series A led by GV and Menlo Ventures.

Unique, a Swiss company creating an AI platform for financial companies, raised a $30 million Series A led by CommerzVentures and DN Capital.

Women's health startup Millie raised a $12 million Series A from investors including Foreground Capital and TMV.

PE Deals

Meta is in talks to raise $35 billion in a financing package led by Apollo Global Management for building data centers in the US, Bloomberg reported.

Ardian bought a 10% stake in London’s Heathrow Airport from Ferrovial, Canadian pension fund Caisse de dépôt et placement du Québec and the UK’s Universities Superannuation Scheme.

Exits

Bain Capital is considering a sale of Rocket Software in a deal that could value the IT automation company at around $10 billion, Reuters reported.

A unit of Fantix that uses AI for advertising has been acquired by location-tracking device company Life360. Fantix's founder and CEO will both be joining Nasdaq-listed Life360.

Cloud observability platform developer Dashdive has been acquired by physical security startup Rhombus.

Unisplendour, a Chinese cloud computing software and equipment provider, is planning a second listing in Hong Kong, Bloomberg reported.

Fundraising

Copenhagen-based IDC Ventures has launched its debut fund of funds with a €150 million cap.

Chart of the Day

Source: 2024 Annual US VC Valuations Report

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PitchBook News - VC valuations feel the pressure

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