PitchBook News - Apollo, PE and succession struggles

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The Daily Pitch: VC

May 21, 2021

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Today's Top Stories

More fallout over PE succession struggles as Apollo's Harris steps aside

Apollo Global Management co-founder Josh Harris (left) was considered the front-runner to succeed Leon Black.
(Jim McIsaac/Getty Images)

Executing a succession plan is rarely easy. It's been particularly tough for private equity.

The latest example came Thursday when Apollo Global Management co-founder Josh Harris announced he would step back from his day-to-day role as managing director in early 2022, capping a power struggle to succeed co-founder Leon Black following an internal probe into Black's ties to disgraced financier Jeffrey Epstein. Co-founder Marc Rowan ultimately was named CEO.

Harris started Apollo in 1990 with Black and Rowan. And, as the head of the firm's booming private equity unit, was considered a front-runner to be CEO. But Rowan instead won out after launching an insurance strategy that's now larger than Apollo's buyout arm.

This isn't the first awkward leadership handoff in the industry. Last year, The Carlyle Group co-CEO Glenn Youngkin left the firm to run for governor of Virginia, with Kewsong Lee taking over as sole CEO. The announcement came after months of reported tension between Youngkin and Lee, who stepped in after co-founders David Rubenstein and William Conway stepped back from managing the firm's day-to-day operations in 2017.

Finally, Vista Equity Partners president and co-founder Brian Sheth left the firm last year after founder Robert Smith admitted to tax fraud, leaving the tech-focused investor without one of its top dealmakers. Sheth likely would have been a candidate to take over for Smith.

Related read: Leon Black to step down after Epstein probe; Apollo to embrace strategic shift

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Breaking down the SoftBank Vision Funds' turnaround

SoftBank CEO Masayoshi Son in 2015
(Koki Nagahama/Getty Images)

Over the course of one year, SoftBank rebounded from its largest-ever annual loss to record-setting profits—both outcomes owed to its Vision Fund bets. Our latest PitchBook analyst note delves into how the firm has evolved. Among the takeaways:

The Vision Fund was propelled by high step-up multiples for late-stage mega-rounds and premium prices for tech IPOs. Coupang and DoorDash alone delivered around $29 billion in gains for the Japanese firm.

The Vision Fund 2 marks a departure from its predecessor: Its bets are smaller, more diversified and laser-focused on artificial intelligence.

SoftBank's success has bolstered the thesis that mega-financing can pay off in venture capital. Hedge funds and other nontraditional investors are increasingly borrowing from the Vision Fund playbook.

read it now

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Ranking the most active investors of Q1

In the wake of a year like no other, 2021 is off to a busy start for dealmakers. EQT, Shore Capital Partners and The Carlyle Group led the PE side, and Enterprise Ireland was far and away the busiest venture investor in Q1.

PitchBook's Global League Tables for the first quarter of this year are now available, spanning the full spectrum of the private markets.

These interactive tables rank everything from the most active VCs in China to the busiest PE law firms.

The data can be broken down by firm, deal type, geography, sector and more.

check out the rankings

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Trade Republic tops $5B valuation with Series C

German neobroker Trade Republic has raised $900 million in a round led by Sequoia, valuing the company at over $5 billion.

The Series C makes Trade Republic one of the most valuable fintech companies in Europe, behind major players such as Klarna, Checkout.com and eToro.

The funding is a significant step-up from its Series B, which saw Trade Republic pull in €62 million (about $76 million) last year. The latest investment was supported by new investors TCV and Thrive Capital, alongside existing backers Accel, Founders Fund, Creandum and Project A.

Trade Republic allows users to invest in stocks, exchange-traded funds and derivatives on a commission-free basis. It currently operates in Germany, Austria and France, with over 1 million customers and more than $7 billion in assets under management.

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Recommended Reads

After Suzy Niffenegger was evicted from her condo, no landlord would rent to her. She's just one of many low-income Americans who have turned to extended-stay hotels as a last housing option. [The New York Times]

Controversial NYU Stern professor, author, pundit and startup founder Scott Galloway on Clubhouse, WeWork and why he antagonizes venture capitalists. [Forbes]

The COVID-19 situation in the US seems to finally be heading toward the light at the end of the tunnel. But the pandemic's mental wounds are still wide open. [The Atlantic]

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Quick Takes


	The Daily Benchmark
	2012 Vintage Global VC Funds-of-Funds
	VC Deals
	Workforce management startup snags $300M
	Figure raises $200M at $3.2B valuation
	Sunbit lands $130M for buy-now-pay-later platform
	Loom banks $130M
	Dooly nabs $80M
	Heyday brings in $70M
	Esper secures $30M Series B
	Portfolio Companies
	WeWork racks up $2.1B in losses
	Robinhood debuts IPO access to users
	Fundraising
	Bain Capital Ventures stocks up with $1.3B across two funds

The Daily Benchmark

2012 Vintage Global VC Funds-of-Funds

Median IRR

17.10%

Top Quartile IRR Hurdle Rate

20.35%

2.39x

Median TVPI

Select top performers

Cendana Capital

SVB Strategic Investors Fund V-A Opportunity

Franklin Park Venture Fund Series 2012

*IRR: net of fees

12 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Workforce management startup snags $300M

Workforce management startup Workrise has raised $300 million in a Series E led by Baillie Gifford. The Austin-based company, formerly known as RigUp, helps energy and infrastructure companies find skilled workers for projects; its platform also manages payroll, benefits and access to training. Workrise was valued at $1.84 billion last year, according to PitchBook data.

Additional Investors:

137 Ventures, Andreessen Horowitz, Bedrock, Brookfield Technology Partners, Founders Fund, Franklin Templeton Investments, Moore Strategic Ventures

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Figure raises $200M at $3.2B valuation

Figure, a fintech startup that offers lending, trading, and settlement infrastructure using blockchain technology, has closed a $200 million Series D led by 10T Holdings and Morgan Creek Digital. The round, which values the company at $3.2 billion, also saw participation from new and existing investors including DCM Ventures, Ribbit Capital and RPM Ventures. The startup was co-founded in 2018 by SoFi co-founder Mike Cagney.

Additional Investors:

DST Global, HCM Capital, Digital Currency Group

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Sunbit lands $130M for buy-now-pay-later platform

Fintech startup Sunbit has raised $130 million at a $1.1 billion valuation in a round led by Group 11. The Los Angeles-based company provides a platform that splits up online and in-store purchases into smaller payments, working with auto dealers, dentist offices, optical practices and more. Sunbit was valued at $80.3 million in 2019, according to PitchBook data.

Additional Investors:

AltaIR Capital, More Investment House, Migdal Insurance, The Harel Group, Zeev Ventures

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Loom banks $130M

Loom, a workplace video-messaging startup, has raised a $130 million Series C led by Andreessen Horowitz, with participation from Iconiq Capital, Kleiner Perkins, Sequoia, Coatue Management and General Catalyst. The new funding values the San Francisco-based company at $1.53 billion. It was valued at $323 million last year, according to PitchBook data.

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Dooly nabs $80M

Dooly, a developer of note-taking automation software for Salesforce, has raised an $80 million Series B led by Spark Capital. New investors Greenspring, Tiger Global and Lachy Groom, as well as returning investors including Boldstart Ventures, also joined the round. The investment brings the Vancouver, Canada-based startup's total funding to over $100 million.

Additional Investors:

BoxGroup, Addition

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View 53 competitors »

Heyday brings in $70M

Heyday has raised a $70 million Series B led by General Catalyst, with participation from Khosla Ventures and Arbor Ventures. The company offers a data-driven platform to help third-party sellers on digital marketplaces such as Amazon build brand exposure to new markets. Heyday emerged from stealth in November with a $175 million Series A.

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Esper secures $30M Series B

Esper, which offers a platform for enterprise device management and DevOps, has raised $30 million in a round led by Scale Venture Partners. Existing investors Madrona Venture Group, Root Ventures, Ubiquity Ventures and Haystack also participated in the funding. Based in the Seattle area, the company raised $7.6 million in February 2020.

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Portfolio Companies

WeWork racks up $2.1B in losses

WeWork's Q1 losses nearly quadrupled to $2.1 billion amid a sharp drop in members of its shared-office workspaces, the Financial Times reported, underscoring the challenge facing the company in its effort to return to profitability. WeWork's settlement in parting ways with co-founder Adam Neumann accounted for some $500 million of the quarterly loss, according to the report. WeWork is set to go public in a pending reverse merger with BowX Acquisition Corp. at a valuation of $9 billion. Before its aborted IPO in 2019, WeWork's valuation peaked at $47 billion.

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Robinhood debuts IPO access to users

Robinhood has started to allow traders on its platform to buy shares of companies in an IPO. The online brokerage will offer shares that have been allocated to it by underwriters, and it won't have access to all IPOs. Traders who submit requests to purchase a stock may be given access subject to the availability of the stock and a random selection process overseen by Robinhood. Medical clothing company Figs will be the first company to offer shares through the new service.

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Fundraising

Bain Capital Ventures stocks up with $1.3B across two funds

Bain Capital Ventures has raised $950 million for its ninth core fund, which will target early-stage startups. The firm has also raised a $350 million co-investment fund to target growth opportunities. Operating out of several offices throughout the US, BCV focuses on the cloud infrastructure, AI, and machine learning sectors, among others. The firm made 37 new seed and Series A investments in the past year. Its portfolio includes Attentive, Clari, Flywire and Redis Labs.

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View 351 investments »