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The Daily Pitch: VC

May 25, 2021

Like our newsletter? The data comes from the PitchBook Platform — our data software for VC, PE and M&A

Today's Top Stories

US VC valuations continue to spike

Valuations of VC-backed companies were at or near record highs in the first quarter of the year. The venture capital market was buoyed by strong IPO exits, participation from capital-rich nontraditional investors, and broader economic recovery on the horizon.

Our Q1 2021 US VC Valuations Report dissects valuation changes across investment stages and sectors. Key takeaways include:

Early-stage valuations hit record highs in Q1, with median and average pre-money valuations coming in at $40 million and $96.3 million, respectively. The time between early-stage rounds dropped to a level not seen since 2015.

Late-stage valuations were boosted by an abundance of outsized deals as well as proximity of late-stage deals to the IPO market, with median and average pre-money valuations reaching record highs of $122.5 million and $1.03 billion, respectively.

Valuations for late-stage deals with nontraditional participation rose to a median of $219 million, nearly $170 million larger than in deals where these institutions do not invest.

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On the podcast: Private equity's sports play

The Golden State Warriors became another franchise to receive a PE investment earlier this year. (Will Newton/Getty Images)

Headlined by Arctos Sports Partners acquiring a 5% stake in the Golden State Warriors in April, private equity has pushed further into the sports investing space over the past few years. PitchBook analyst Wylie Fernyhough joins the "In Visible Capital" podcast to discuss his recent analyst note about what's driving the trend. Topics discussed include:

Decisions by the NBA and MLB to loosen restrictive ownership rules.
How the COVID-19 pandemic affected the sports industry.
The chance for new investors to achieve lofty returns and the clout that comes with owning some of the most scarce, high-profile assets available.

Recommended Reads

The Canada Pension Plan Investment Board just finished its strongest year in history. How did it get there? [Institutional Investor]

As many workers hesitantly mull a potential return to the office, one writer asks: What if remote work didn't actually mean working from home? [The New Yorker]

After watching peers' stocks slide and investors balk, some startup entrepreneurs are beginning to give SPACs the cold shoulder. [The Wall Street Journal]

Since yesterday, the PitchBook Platform added:

28

VC valuations

1498

People

396

Companies

28

Funds

See what our data software can do

Quick Takes


	The Daily Benchmark
	2014 Vintage North American Debt Funds
	VC Deals
	Zeta picks up $250M Series C
	Aurora Solar secures $250M Series C
	SiLC Technologies secures $17M
	Exits & IPOs
	Connected car startup Wejo mulls SPAC
	Fundraising
	Kaszek Ventures collects $1B across two funds

The Daily Benchmark

2014 Vintage North American Debt Funds

Median IRR

8.05%

Top Quartile IRR Hurdle Rate

9.19%

1.24x

Median TVPI

Select top performers

KSL Capital Partners Credit Opportunities Fund

Strategic Value Special Situations Fund III

AG Securitized Asset Recovery Fund

*IRR: net of fees

31 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Zeta picks up $250M Series C

Fintech startup Zeta has raised $250 million at a $1.45 billion valuation, a steep jump from the $300 million valuation it received in 2019. SoftBank's Vision Fund 2 led the Series C, with participation from Sodexo, one of Zeta's customers. India-based Zeta provides products like payment processing, personal loans and white-label mobile apps for banks and other fintech providers.

View round

View 7 competitors »

Aurora Solar secures $250M Series C

Aurora Solar has raised $250 million in a round led by Coatue Management, with participation from Iconiq Capital, Energize Ventures and Fifth Wall. The San Francisco-based company is a creator of solar software designed to manage and sell installations. In November, Aurora Solar raised $50 million at a $450 million valuation, according to PitchBook data.

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View 10 competitors »

SiLC Technologies secures $17M

SiLC Technologies has raised a $17 million Series A co-led by Alter Venture Partners and Dell Technologies Capital. Founded in 2018, the company is a developer of photonic sensors and imaging chips.

Select Additional Investors:

UMC Capital, Global Brain

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View 2 competitors »

Exits & IPOs

Connected car startup Wejo mulls SPAC

Wejo is considering a reverse merger with blank-check company Virtuoso Acquisition Corp. in a deal that could value the UK-based startup at over $1 billion, Reuters reported. Wejo is the creator of a connected car data platform that works with city planners, auto manufacturers, navigation software developers, retailers and others. The company has received backing from investors like DIP Capital and General Motors. Virtuoso went public on the Nasdaq in January.

View details

View 24 competitors »

Fundraising

Kaszek Ventures collects $1B across two funds

Kaszek Ventures, a Latin America-focused firm, has raised a $475 million early-stage vehicle and a $525 million opportunities fund for late-stage investments, TechCrunch reported. Founded in 2011 and based in Sao Paulo, Kaszek has backed companies such as digital housing platform developer QuintoAndar and Nubank, a provider of online banking.

View fund

View 85 investments »

Chart of the Day

"Dealmaking in Q1 2021 reached 605 deals worth $82.4 billion, marking YoY decreases of 12.7% and 32.8%, respectively. The slow start to the year is not surprising considering the pandemic's damaging impact on patient volumes and provider margins, which caused significant uncertainty around and disruption to many healthcare businesses."

Source: PitchBook's Q1 2021 Global M&A Report