Cybersecurity startups near record funding

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The Daily Pitch: VC

June 17, 2021

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Today's Top Stories

Cybersecurity startups near record funding as hacks take spotlight

The account hackers used to access Colonial Pipeline's network wasn't protected by multi-factor authentication, CEO Joseph Blount told Congress last week. (Pool/Getty Images)

A year of remote work and life has left companies' data vulnerable, and ransomware attacks are spurring them to update security safeguards.

The demand has helped push cybersecurity companies to raise $9.9 billion in venture funding this year, nearly matching last year's haul in less than six months.

Cloud security startups are leading the charge: The largest round of the year to date went to Lacework, which took in $525 million in January.

Average valuations have doubled in size, as a glut of private capital creates competition for the best startups.

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US middle-market PE gets back on track

With vaccination rates increasing, plenty of cheap debt available and a potential capital gains tax hike on the horizon, the US private equity middle market experienced another robust quarter of dealmaking during the first three months of 2021. PitchBook's Q1 2021 US PE Middle Market Report, sponsored by Antares Capital and Withum, and presented in partnership with ACG, takes a deeper look at a range of topics impacting middle-market investors, including:

How PE fundraising came back to life after a difficult 2020, with emerging investors bouncing back and sector specialists experiencing noteworthy success.

How the threat of looming capital gains tax increases, the abundance of SPACs and the slow recovery of the US energy sector impacted PE middle-market exit activity, with firms exiting 190 companies for a combined value of some $37 billion.

Why some PE firms are completing more add-on acquisitions within shorter platform holding periods—while others are raising continuation funds to facilitate long-term buy-and-build plays.

read it now

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A message from Insight2Profit

Four ways to ensure your data drives multiples

It's easy to become overwhelmed by the amount of data your company has—transaction data, freight files, rebates, contract data, discount files, competitor information, inventory reports, etc.—leaving you with more questions than answers. Your data should eliminate unknowns, showcase the strength of your business and uncover value creation opportunities. Having this commercial clarity yields increased interest in and competition for your business, driving a higher valuation and rewarding you with higher multiples.

To help set you apart, we've compiled four ways to successfully demonstrate commercial excellence through good data by:

Organizing data to increase speed to impact
Driving segmentation into your commercial strategy
Reacting to changing market conditions
Maximizing the effectiveness of technology and tools

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Waymo grabs $2.5B in second outside financing

Waymo One is currently available to riders in the Phoenix area. (Courtesy of Waymo)

Self-driving car maker Waymo has secured $2.5 billion in new funding, marking the second-largest deal for an autonomous driving company in the US this year and the fifth-largest since 2016, according to PitchBook data.

The Mountain View, Calif.-based Alphabet subsidiary will use the funds to further develop its autonomous technology for freight-hauling vehicles and passenger cars, and to expand its team. Among those participating in the round were private equity firm Silver Lake, venture capital firm Andreessen Horowitz and Alphabet.

Waymo's services currently include Waymo One, an autonomous public ridehailing service operating in the Phoenix area, and Waymo Via, a delivery service that has partnered with UPS, AutoNation and others.

This is Waymo's second outside investment round. In May 2020, the company completed a $3 billion debut fundraise led by Silver Lake, Canada Pension Plan Investment Board and Mubadala.

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Recommended Reads

Teletherapy aims to make mental healthcare more inclusive. But the problems that kept many people from seeking care before the pandemic still exist. [Time]

A growing group of ecommerce businesses are positioning themselves as "anti-Amazons." And it's working. [The Wall Street Journal]

The rise and fall of Kodak, an American tech giant. [The Atlantic]

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Quick Takes


	The Daily Benchmark
	2013 Vintage North American Venture Funds
	VC Deals
	Plant-based food maker banks $226M
	Guideline gets $200M for retirement planning
	BrowserStack picks up $200M Series B
	Iterable hits $2B valuation
	Fractyl Health collects $100M Series F
	SoftBank backs $60M round for Chile's Betterfly

The Daily Benchmark

2013 Vintage North American Venture Funds

Median IRR

15.44%

Top Quartile IRR Hurdle Rate

29.90%

1.81x

Median TVPI

Select top performers

Foresite Capital Fund I

Maven Ventures Growth Labs Fund I

YLV II

*IRR: net of fees

35 Funds in Benchmark »

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PitchBook Webinar: Identifying and mitigating fund return smoothing

Join us on June 24 as we discuss fund return smoothing and dive into ways to "desmooth" returns, allowing for a more accurate representation of the performance and volatility of private market funds.

In the latest edition of our ongoing PitchBook Private Fund Strategies webinar series, formerly the PitchBook Benchmarks series, we'll start with updated performance and fundraising data, and then put a spotlight on the issue of private market fund return smoothing. Mark-to-market accounting and conservative valuations can produce misleading, artificially smoothed private market returns. As a result, volatility may be significantly understated, causing diversification benefits to be overstated.

We will explore topics including:

Background and reasons for fund return smoothing.

How smoothing leads to deceptive returns.

How to apply desmoothing techniques to measure volatility in private market funds more accurately.

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VC Deals

Plant-based food maker banks $226M

Foodtech startup Motif FoodWorks has raised $226 million in a Series B led by Ontario Teachers' Pension Plan Board and BlackRock. Boston-based Motif, which spun out of synthetic biology leader Ginkgo Bioworks, aims to improve the taste and texture of plant-based foods through novel ingredients. It was valued at $327.5 million in 2019, according to PitchBook data.

Select Additional Investors:

AiiM Partners, CPT Capital, General Atlantic, Rage Capital, Viking Global Investors

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Guideline gets $200M for retirement planning

Guideline, a San Mateo, Calif.-based provider of retirement software used by small and medium-sized businesses, has received $200 million in an investment led by growth equity firm General Atlantic. Existing backers Generation Investment Management, Greyhound Capital, Felicis Ventures, Propel Venture Partners and others also participated in the round, which values the company at $1.15 billion, according to a PitchBook estimate.

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BrowserStack picks up $200M Series B

BrowserStack, the maker of a platform for testing software in the cloud, has raised $200 million at a $4 billion valuation. Bond led the Series B, with Insight Partners and Accel participating. BrowserStack, which is located in San Francisco, New York, Dublin and Mumbai, counts tech giants like Google, Amazon and Microsoft as customers.

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Iterable hits $2B valuation

Iterable has been valued at $2 billion after raising $200 million in Series E financing. New investors in the round included Silver Lake, Adams Street Partners, Glynn Capital and DTCP. San Francisco-based Iterable operates a marketing platform that is used by customers including mediation app maker Calm and proptech company Opendoor.

Additional Investors:

CRV, Viking Global Investors, Blue Cloud Ventures, Capital One Ventures

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Fractyl Health collects $100M Series F

Fractyl Health has raised $100 million in a round co-led by Maverick Capital, M28 Capital and Population Health Partners. Based in the Boston area, the company is a developer of therapeutics for metabolic diseases. It plans to use the funds to advance clinical studies intended to reduce insulin dependence for patients with Type 2 diabetes. In August, Fractyl raised $55 million at a $385 million valuation, according to PitchBook data.

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SoftBank backs $60M round for Chile's Betterfly

Santiago, Chile-based Betterfly has raised a $60 million Series B from DST Global, QED Investors, Valor Capital, Endeavor Catalyst and SoftBank's Latin America Fund. Betterfly, which provides insurance and an employee engagement, wellbeing and social impact platform, plans to use the funds in part to expand into Brazil and other Latin American countries. The startup raised around $18 million for its Series A.

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