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| There will be no newsletter on Friday in observance of Juneteenth, a PitchBook company holiday. |
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How COVID-19 is shaping insurtech investment
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Our latest research note examines the pandemic's impact on insurtech. As the insurance industry faces the near-term implications of potentially significant financial losses, our analysts contend the crisis could spur long-term growth opportunities—and drive more investment in the insurtech sector. Key takeaways:
- Auto insurers will seek more automated driver data rather than rely on self-reporting
- Commercial insurers are likely to make bigger investments in digital engagement tools and could see growth in high-risk areas of the economy
- Digital infrastructure needs will accelerate as the coronavirus outbreak reveals weaknesses in the current technology
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Popularity of middle-market add-ons continues to grow
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In 2006, fewer than 50% of all investments in the US middle market were add-ons. By the first quarter of 2020, that figure had climbed to 72.5%, a new record high, signaling that private equity's appetite for such deals continues to grow.
That's one key takeaway from PitchBook's Q1 2020 US PE Middle Market Report, sponsored by Antares Capital, which breaks down all the latest data and dealmaking trends from the first three months of the year, before the full side effects of the pandemic began to be felt. Other highlights include:
- Middle-market deal count largely kept pace with last year's record-setting totals
- Fundraising activity stayed steady, with vehicles of more than $1 billion dominating the market
- Middle-market IPOs had a brief resurgence before the coronavirus crisis kicked in
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The road to IPOs in the COVID-19 era
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Economic turmoil stemming from the pandemic may still grip the world, but markets remain puzzlingly contrary. Consequently, the prospects for an initial public offering remain tricky, as companies hoping to go public must assess a broader host of variables than ever before.
In the second installment of the Road to Next series, Deloitte experts explore the IPO environment for expansion-stage companies—a new segment of private markets defined by maturity, massive sums of private funding and scale unseen before the 2010s. Drawing on a variety of PitchBook datasets, the report examines:
- What companies should be prioritizing as they continue with IPO preparations begun before the pandemic
- Key traits of the companies exhibiting the most resilience in the current environment
- How investors are assisting their portfolio companies
The full report also features a spotlight on the role that private equity fund managers can claim in this highly opportunistic climate: read it now. |
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Wondering how the economy reopening will affect your segment of the private markets? Looking for insight into which industries are likely to bounce back faster than others? Curious about what's driving a new trend you've noticed?
Email us at ask@pitchbook.com, and the news team will choose a question and track down the answer. |
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China has tried to rapidly ramp its economy back up after widespread shutdowns because of the coronavirus. When it comes to making deals in the country, though, The Carlyle Group plans to be patient. [Bloomberg]
Protests about racial inequality and police brutality have swept across the nation in recent weeks. But in Minneapolis, where the uprising began, residents are trying to reckon with the movement they've begun. [The New Yorker]
In recent years, for-profit colleges have generated their share of controversy. Amid a pandemic, they're seeing a boom in business. [The New York Times] |
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Since yesterday, the PitchBook Platform added:
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35
VC valuations
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1717
People
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344
Companies
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22
Funds
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2014 Vintage Global Venture Funds with less than $250M
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Webinar: Venture, buyout and real assets funds during market downturns
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Join us on June 25 at 10 a.m. PT/1 p.m. ET for a conversation around venture, buyout and real assets funds and how investors can interpret performance and cash flows in previous downturns to build a road map for the current one. During the discussion, PitchBook analysts will explore:
- Why we expect many VC funds to shift focus to supporting existing portfolio companies and adjust their reserve capital
- How buyout funds tend to issue smaller and fewer capital calls and distributions in a recession and why the approach might be different this time
- Why the performance of recent vintages of real assets funds is likely to take a hit
Register here to secure your spot |
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UiPath eyes $10B+ valuation
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| UiPath is looking to raise new capital that could value the New York-based company at more than $10 billion, according to Bloomberg. Backed by investors including Accel, Sequoia and CapitalG, UiPath is a creator of robotic process automation software. The company raised a $568 million Series D in April 2019, valuing it at $7.1 billion, according to PitchBook data. |
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| Fintech startup Pagaya has raised $102 million in Series D funding to fuel the development of its asset management platform for institutional investors. The round was led by an unnamed financial institution and included participation by Aflac Global Ventures, Poalim Capital Markets, Viola and Oak HC/FT. Pagaya was founded in 2016 and is based in New York and Tel Aviv. |
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Content management startup collects $80M
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Upgrade reaches unicorn status with $40M Series D
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| Online banking startup Upgrade has collected $40 million in fresh funding led by Santander InnoVentures, valuing the business at $1 billion. Existing backers including Union Square Ventures, Ribbit, Vy Capital and Silicon Valley Bank also participated. Based in San Francisco, the company offers credit to consumers through cards and personal loans; it also provides credit monitoring and education services. Upgrade was valued at $562 million in 2018. |
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| Unbounce has raised C$52 million (about $38.4 million) in a round led by Crest Rock Partners, according to TechCrunch. Founded in 2009 and based in Vancouver, Canada, the company helps brands including Zola and Campaign Monitor create custom website landing pages without code. Before this funding, Unbounce had reportedly not raised any outside financing since a 2011 seed round. |
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Sapphire Ventures leads $30M round for security analytics startup
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| Uptycs has landed $30 million in a Series B led by Sapphire Ventures. Comcast Ventures and ForgePoint Capital also participated in the round, which brings the cybersecurity startup's total funding to $43 million. Based in Massachusetts, Uptycs offers a SQL-powered security analytics platform that helps engineers, IT professionals and other users observe and secure productivity endpoints. |
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Onna pulls in $27M Series B
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| Knowledge integration startup Onna has raised $27 million in a round led by Atomico. The company, which operates out of New York and Barcelona, enables companies to manage proprietary knowledge across workplace apps such as Slack, Salesforce and Dropbox. |
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Proprio lands $23M for precision surgery
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| Healthtech startup Proprio has raised $23 million in a Series A round led by DCVC. The Seattle-based startup's computational imaging system aims to help surgeons perform procedures more easily and accurately. DCVC partner Armen Vidian has joined Proprio's board as part of the investment. |
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Facebook's Jio investment draws scrutiny
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| India's primary antitrust regulator has decided to review Facebook's agreement to acquire a 9.9% stake in Jio Platforms, a rapidly growing internet services business controlled by Indian conglomerate Reliance Industries. Facebook agreed in April to inject $5.7 billion in Jio, beginning a wave of investment in the company over the past two months that has also included deals with firms such as Silver Lake, Vista Equity Partners and KKR. |
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ByteDance's Q1 revenue jumps to $5.6B
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| TikTok owner ByteDance collected about 40 billion yuan (about $5.6 billion) of revenue in the first quarter of 2020, representing a 130% growth year-over-year, according to Reuters. The Beijing-based company also set a 2020 revenue goal of about 200 billion yuan, or a little more than $28 billion, the report said. ByteDance reportedly posted revenue of $17 billion last year. |
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Caterpillar scoops up Marble Robot
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| Caterpillar has bought some assets and hired staff from Marble Robot, a San Francisco-based company that develops courier robots. The acquisition is part of Caterpillar's automation strategy as it looks to make more investments in emerging technologies. Marble Robot raised $10 million in 2018 at a $37.5 million valuation, according to PitchBook data. |
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"History suggests that funds raised during and in the aftermath of crisis periods tend to outperform, meaning many investors will see this sharp downturn as the best opportunity for returns in years. Real estate funds raised during and in the immediate aftermath of the [Great Financial Crisis] (vintages 2009-2012), for example, have been better performers compared to pre-crisis era funds (2004-2007)."
Source: PitchBook analyst note on real asset funds in times of crisis |
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