Startups step into global supply chain gaps

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The Daily Pitch: VC

August 21, 2020

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Today's Top Stories

Startups rise to the occasion amid supply chain constraints

(MR.Cole_Photographer/Getty Images)

In Q2, venture investors poured $2.5 billion into supply chain tech companies in North America and Europe, a 12% drop in deal value year-over-year, but a quarter-over-quarter increase of nearly 111%, according to our new Emerging Tech Research report.

The global supply chain is sprawling and highly fragmented, and the pandemic has strained the system and led to significant supply-and-demand mismatches. Startups are stepping up to fill the gaps, and, in turn, investors are putting substantial amounts of capital toward both modernizing and disrupting this industry. Other key takeaways from the report include:

Last-mile delivery services are a focal point for investors, driving significant VC deal activity

The need to pandemic-proof parts of the supply chain is steering capital toward previously underfunded areas such as risk management and warehousing tech

Dealmaking has waned in freight tech, as investors pull back from digital brokerage platforms like Convoy and Uber Freight

If you have any questions or feedback about the research, we'd love to hear from you: analystresearch@pitchbook.com

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Co-founders of Community allege they were tricked into selling shares

Sound Ventures' Guy Oseary and Ashton Kutcher are backers of Community, the Hollywood-centric messaging company now entangled in a lawsuit. (Joe Scarnici/Getty Images)

The CEO of Community, the operator of a celebrity-focused messaging platform backed by Guy Oseary and Ashton Kutcher, allegedly misled a group of co-founders about the startup's condition in a scheme to buy back their shares, according to a lawsuit filed by the investors.

Early co-founders Charles Buffin, Max Levine and his father, Steven Levine, allege that CEO Matthew Peltier falsely painted a "dire picture" of the company but concealed from them that he was fundraising at the time at a valuation of about $180 million, according to the complaint filed in federal court in Los Angeles.

Peltier allegedly told the investors if they sold their shares it would save the company from insolvency. In 2018, they agreed to sell 600,000 shares, a combined stake of 10%, for about $22,000 each, according to the lawsuit.

The lawsuit says Community is currently believed to be seeking another funding round, this time at a valuation of about $450 million. Sound Ventures, the firm led by Oseary and Kutcher, reportedly invested with Sony Innovation Fund in a seed round last year.

Peltier, Kutcher and Oseary didn't immediately respond to requests for comment.

Santa Monica-based Community allows fans to interact with celebrities including Kutcher, Jennifer Lopez and Paul McCartney.

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Quick Takes


	The Daily Benchmark
	2010 Vintage Global Funds-of-Funds
	VC Deals
	Waterdrop banks $230M, plans IPO
	BlockFi picks up $50M Series C
	Ultrasound device maker adds $40M to Series B
	Checkerspot pulls in $36M
	Cobalt grabs $29M Series B
	Japanese space company lands $28M
	Portfolio Companies
	DoorDash launches grocery delivery
	Ant Group Q1 profit skyrockets 560%
	Exits & IPOs
	ThredUp preps for IPO in 2021
	Asana selects NYSE for direct listing

The Daily Benchmark

2010 Vintage Global Funds-of-Funds

Median IRR

13.05%

Top Quartile IRR Hurdle Rate

14.66%

1.63x

Median TVPI

Select top performers

Commonfund Capital Venture Partners IX

WP North America Private Equity II

TrueBridge-Kauffman Fellows Endowment Fund II

*IRR: net of fees

38 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Waterdrop banks $230M, plans IPO

Beijing-based Waterdrop, aka Shuidi, has raised $230 million in financing led by reinsurer Swiss Re and Tencent, according to reports. Existing backers IDG Capital and Wisdom Choice Global also reportedly participated in the round. Waterdrop, which offers an online insurance platform, is now valued at nearly $2 billion and is planning an IPO in the US, according to Reuters.

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BlockFi picks up $50M Series C

Cryptocurrency startup BlockFi has secured $50 million in a round led by Morgan Creek Digital, with support from existing investor Valar Ventures and others. The New Jersey-based company operates a cryptocurrency wealth management platform; it plans to use the Series C funding to expand its services across Asia and Europe. BlockFi was valued at $150 million with a $30 million round in February, according to PitchBook data.

Select Additional Investors:

CMT Digital, Castle Island Ventures, Winklevoss Capital, SCB 10X, Avon Ventures

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Ultrasound device maker adds $40M to Series B

Exo, the developer of a handheld ultrasound device, has wrapped up a $40 million Series B extension that will help fund research and product development. Fiscus Ventures, Reimagined Ventures and Action Potential Venture Capital led the investment, which comes after the Redwood City, Calif.-based company raised $35 million for the first tranche of its Series B in August 2019.

Additional Investors:

TDK Ventures, Solasta Ventures, Intel Capital, Applied Ventures

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Checkerspot pulls in $36M

Checkerspot, which develops consumer materials using microalgae, has raised $36 million in a Series B led by Viking Global Investors. Builders VC, Cavallo Ventures and Breakout Ventures also participated in the funding, which values Checkerspot at $118 million, according to PitchBook data. The Berkeley, Calif.-based company has three materials available commercially, for use in areas like outdoor recreation and waste management.

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Cobalt grabs $29M Series B

Cobalt, the developer of a cybersecurity platform, has taken in $29 million in a Series B led by Highland Europe. Founded in 2013, the San Francisco-based startup connects so-called ethical hackers with companies that want to test their applications for security vulnerabilities. Cobalt has over 500 clients including GoDaddy, Vonage and Axel Springer.

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Japanese space company lands $28M

Japanese space startup iSpace, has raked in $28 million to help fund its mission to land on the moon. Incubate Fund led the Series B round, with Space Frontier Fund, Takasago Thermal Engineering Co. and Mitsui Sumitomo Insurance Co. also participating. So far, the Tokyo-based company has raised $125 million. It plans to launch its first mission to the moon in 2022 and a second in 2023.

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Portfolio Companies

DoorDash launches grocery delivery

DoorDash has expanded its services to on-demand grocery delivery, beginning with select supermarket chains in California and parts of the Midwest. Users in the Bay Area, Los Angeles, Sacramento, San Diego and other areas of California can order from Smart & Final, while customers in Chicago, Cincinnati, Milwaukee, Detroit and Indianapolis will be able to access products via Meijer and Fresh Thyme. DoorDash has plans to add Hy-Vee and New York-based grocers Gristedes and D'Agostino to its roster in the coming weeks.

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Ant Group Q1 profit skyrockets 560%

Alibaba-backed Ant Group posted a 9.2 billion yuan (about $1.3 billion) profit in the first quarter of this year, a 560% jump from a year ago, according to Bloomberg. The Chinese fintech giant is reportedly planning a dual public listing in Hong Kong and Shanghai that may value it at about $210 billion and could be the world's biggest IPO in years.

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Exits & IPOs

ThredUp preps for IPO in 2021

ThredUp is planning to go public early next year and could raise $200 million to $300 million in the offering, Bloomberg reported. The company, which operates an online used clothing marketplace, raised $175 million last August at a valuation of $670 million, according to a PitchBook estimate. In May, Bay Area-based ThredUp announced a partnership with Walmart to sell used clothing on the retailer's website.

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Asana selects NYSE for direct listing

Workplace software maker Asana has chosen the NYSE as the exchange for its planned direct listing in late September, according to Bloomberg. Recently, the San Francisco-based startup has reportedly been trading on the secondary market at around a $5 billion valuation. Asana could reveal its financials later this month and host an investor day in September, Bloomberg reported. The company first announced it had filed for the public listing in February.

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Chart of the Day

"Interest in VC-backed IPOs has been prevalent during the last two years, as record listings have taken place in the US and Europe. Only three listings occurred in Europe in Q1 2020, and this figure is not likely to increase substantially in the next three quarters. Risks associated with volatility in public equity markets will deter IPOs in the short term as VC investors and operators attempt to preserve valuations instead of seeking out liquidity."

Source: PitchBook's Q1 2020 European VC Valuations Report