VC-backed exits are about to get hotter

Plus: IT buyout multiples soar, cultivated meat startups gobble up millions, PE cashes in on the housing boom and more
Read online | Don't want to receive these emails? Manage your subscription.
Log in
The Weekend Pitch
July 18, 2021
Presented by Capital Allocators
Over the past decade, limited partners have plowed ever-greater allocations into the venture capital market in a quest for stellar returns. And now those returns are finally poised to roll in.

Waves upon waves of hefty distributions by venture funds are coming due as a result of an exit landscape that has never been richer and more active. For the past couple years, VC-backed companies have been going public or getting acquired in greater numbers and at vastly higher values in aggregate.

I'm Alexander Davis and this is The Weekend Pitch; you can reach me at or follow me via @alecdavis on Twitter. In this edition, we're taking measure of the market for VC-backed exits, which has seen ups and downs since the global financial crisis. And right now it's on an upswing—in a very big way.
(Sean Gladwell/Getty Images)
One of the most striking takeaways about today's venture ecosystem is that its ability to pump out record-breaking yearly totals may be the new normal, at least for the next few years. It's the legacy of the past decade's unicorn boom, which produced technology IPO darlings like Airbnb and Snowflake last year, followed this year by even larger mega-exits from the likes of Coinbase, Roblox and (expected in the coming weeks) Robinhood.

The road from Silicon Valley to Wall Street certainly is seeing a lot more traffic, and the cars taking that route are getting much glitzier and more expensive.

Given the potential deals in the pipeline, all signs are pointing to a sustained run of richer exit years for some time going forward, barring a market correction. Liquidity could be massive, as there are still 181 VC-backed unicorn companies that were founded 10 or more years ago.

"It's always hard to predict, but the secular tailwind is so strong right now for tech," said IVP general partner Eric Liaw, whose firm is an investor in Robinhood. The stock-trading company, which disclosed IPO plans earlier this month, reportedly could be valued at $40 billion or more in what will be one of the most closely watched debuts of 2021.

Last year, according to PitchBook data, total VC exit value in the US scored a new high of some $287 billion, led by the public debuts of Airbnb (with an IPO valuation of over $40 billion) and Snowflake ($33 billion).

Surely that's a whopper of a year for exits by any stretch. We now know, however, that last year's bonanza was merely a taste of things to come: In this year's first half alone, the exit market has already blown away last year's record, with $372 billion in total value, the latest PitchBook-NVCA Venture Monitor reported.

To be sure, this year's early exit bounty reflects the outsize public offerings by crypto-trading specialist Coinbase (valued at over $85 billion out of the gate in April) and online game platform Roblox (nearly $42 billion in March). But even without those two dominant performances, the total exit value for the class of 2021 is 85% of last year's total—well on its way to crushing the previous record.

IPOs, not acquisitions, are the main force at work. Most of the top-value exits in Q2 were from companies going public, according to PitchBook data.

This is all in stark contrast to the scene just a few years ago, when the IPO market was mired in a dry spell even as billion-dollar companies were being minted at a growing clip.

Relatively few VC-backed companies were going public back then because they had plenty of fundraising alternatives. Following the landmark IPO by Facebook in 2012, vast sums of capital began chasing venture deals, as mutual funds, giant asset managers and corporations flocked to the asset class. And lofty valuations became more common—seemingly out of nowhere: In the year after Facebook's IPO, 23 new unicorns emerged globally; by 2018 the yearly total had leaped to 142, PitchBook data shows.

Companies founded in those years are the ones forming the big waves of today's IPO market.

It's not just massive deals like Coinbase and Roblox that tell the story. The number of exits in the US has also been trending higher, and is likely to set another record this year; the first half's 883 deals already represent 75% of the all-time yearly high, set in 2019.

Of course the SPAC effect must be acknowledged. The flood of newly created blank-check companies seeking to take private companies public has been a significant factor on the acquisition front, accounting for 34 of the 123 public offerings through June 30, after 33 such deals were done in all of 2020.

Fittingly, one of those reverse-merger deals was the vehicle that will allow WeWork to make its own long-awaited journey to Wall Street. A SPAC called BowX Acquisition Corp. agreed in March to take the SoftBank-controlled shared-office provider public at a $9 billion valuation. However, that's a fraction of the $47 billion WeWork commanded just before it was forced to scrap its market debut almost two years ago.
Share:   Email    LinkedIn    Twitter    Facebook
A message from Capital Allocators
Compounding knowledge and relationships
Capital Allocators is the critically acclaimed podcast for institutional investors. Host Ted Seides interviews leading asset owners, money managers and thought leaders to learn how these holders of the keys to the kingdom allocate their time and capital. Each interview adds incremental insights to the investment process to help deliver better results. Check it out on your favorite audio platform, and visit to learn more.
Share:   Email    LinkedIn    Twitter    Facebook


"This case illustrates risks inherent to SPAC transactions, as those who stand to earn significant profits from a SPAC merger may conduct inadequate due diligence and mislead investors."

SEC Chairman Gary Gensler on the decision to charge space tech startup Momentus and its blank-check backers with fraud

Did you know ...

(DawnKey/Getty Images)
... That the coming wave of lab-grown meat products could be mixed with a soupçon of plant protein? Startups including Hoxton Farms and Future Meat Technologies are experimenting with hybrid approaches to make tastier, cheaper meat alternatives.

The capital-intensive cultivated protein industry had garnered more than $770 million in VC funding by the end of May, on pace to nearly triple activity in 2020, according to a recent PitchBook analyst note.


GPs are finding out that being part of the IT crowd is more expensive than ever. According to a recent PitchBook analyst note exploring global PE multiples by sector, information technology is now the most highly valued sector for buyouts, with the median EV/EBITDA multiple hitting a peak of 20.1 times in 2020. The biggest contributors to these sky-high valuations have been enterprise software and IT service assets.

While IT investments in Europe and the US are the most expensive, it's not the only sector to attract deals with multiples well north of 20x. The healthcare and B2C sectors in those regions are similarly attracting hefty premiums that would have been unthinkable a decade ago. The former's multiples hit a median of 15.5x over the past three years, while the latter attracted a median buyout multiple of 10.4x in 2020.

Deal Flow

(Ninoon/Getty Images)
A rise in the number of people working from home and cheap mortgage interest rates have triggered another housing boom in the US and Europe. And private equity has been quick to cash in on the trend.
  • Anticipating growing demand for affordable housing, Blackstone put down $5.1 billion this week to pick up certain affordable housing assets from insurance services provider American International Group. The previous month it struck a $6 billion deal for Home Partners of America, a real estate agency that rents out single-family homes across the US.

  • Within the same week as the AIG deal, it was reported that UK PE firm Terra Firma Capital Partners was also seeking to ride the housing boom by picking up PE-backed homebuilder Keepmoat Homes for £700 million (about $963 million) and merging it with Tilia Homes (formerly Kier Living), which the firm acquired earlier in the year. Blackstone has also been active in the country, agreeing to pay £1.25 billion for UK-listed homebuilder St. Modwen Properties.

  • This could just be the start. According to the Financial Times—citing research by Oxford Economics and Haver Analytics—housing prices have soared well over 10% in many parts of the US, and not just in its tier-one cities. Similarly, the EU reported that home prices in the euro area jumped 5.4% year-over-year in Q4 2020. The UK's Office for National Statistics, meanwhile, recently reported that the British housing market was experiencing its fastest annual growth rate in 14 years.

  • Rising prices have been an ongoing issue for some would-be homebuyers since the global financial crisis, but COVID-19 seems to have put that trend on steroids. And with more institutional investors piling into housing, it's unlikely to change direction anytime soon.

Recommended reads

Using the same marble found in Renaissance masterpieces, Italian robots are now sculpting reproductions. Why their owners say the tech is essential to the country's artistic future. [The New York Times]

The ongoing chip shortage has caused a lack of inventory for those looking to purchase a vehicle. But Mercedes is among the automakers whose earnings show that the shortage hasn't been bad for everyone. [Fortune]

One Colorado journalist's take on why "outdoorsy" types tend to be bad with money. [Outside]

Giancarlo Devasini, CFO of crypto exchange Bitfinex, first got into the industry in 2012. But his status as a titan of crypto finance represents a remarkable transformation from his previous careers. [Financial Times]

The space trips of Jeff Bezos and Richard Branson have ignited an interesting debate: Where does space really begin? [The Wall Street Journal]

Women may be more likely than men to want to work from home. But for many of those women, remote work can be both a blessing and a curse. [Recode]
This edition of The Weekend Pitch was written by Alec Davis, James Thorne and Andrew Woodman. It was edited by Alec Davis, Angela Sams and Liana Scarsella.

Were you forwarded The Weekend Pitch? Sign up at
Since yesterday, the PitchBook Platform added:
See what our data software can do
About PitchBook | Terms of use | Advertise with us | Contact

Follow us:   in   twtr   fb

This email was sent to you via the PitchBook Platform.

Do you want to change your email address, get a different edition or unsubscribe? Manage your subscription here.

© 2021 PitchBook Data. All rights reserved.
Venture capital, private equity and M&A financial information technology provider.

Older messages

All the big US VC records will fall

Saturday, July 17, 2021

Plus: Lab-grown protein is cultivating VC interest; What's next for SPACs after this week's SEC fraud charges?; PE record book also being rewritten... Read online | Don't want to receive

Aurora to go public at $13B via SPAC

Friday, July 16, 2021

Lab-grown meat cultivates VC interest; Initialized Capital adds Parul Singh as partner; Auvik Networks banks $250M; Shape Therapeutics picks up $112M Read online | Don't want to receive these

VC rewrites the record books

Friday, July 16, 2021

SEC charges space-tech SPAC dealmakers; Arctic Wolf hits $4B+ valuation; Female Founders Fund closes $57M vehicle; Couchbase sets IPO terms Read online | Don't want to receive these emails? Manage

Discord buys anti-harassment AI company

Friday, July 16, 2021

M1 Finance banks $150M; Kriya Therapeutics lands $100M; Virsec secures $100M; Entos picks up $53M Read online | Don't want to receive these emails? Manage your subscription. PitchBook Log in The

Big tech's approach to AI

Tuesday, July 13, 2021

Rothermere preps $1.1B Daily Mail take-private; Flipkart hits $37.6B valuation; Remote reels in $150M; Microsoft eyes VC-backed RiskIQ Read online | Don't want to receive these emails? Manage your

About that Simone Biles moment

Wednesday, July 28, 2021

INC. THIS MORNING About that Simone Biles moment Good morning, When Simone Biles pulled out of the women's gymnastics team final at the Olympics Tuesday after a bad landing on her vault, it was a

LinkedIn looks to premium publishers as a way to drive subscriber revenue

Wednesday, July 28, 2021

The pilot program is designed to drive subscriber revenue for both participating publishers as well as LinkedIn. July 28, 2021 LinkedIn quietly launched a pilot program last month called LinkedIn

Office life is preparing to make a comeback

Wednesday, July 28, 2021

The great work-from-home experiment moves on to its next phase. Hey there, For all the extroverts in the world, the long-awaited return to the office feels tantalizingly close. For many of us, the

Tesla Made Money Selling Cars. Really.

Wednesday, July 28, 2021

Read in browser > The Signal July 28, 2021 Good morning! Amazon may start accepting crypto as payment. Alright, before you start rushing to the website to check how they're offering exchange

Behind-The-Scenes of my first course (numbers included)

Tuesday, July 27, 2021

Friends, family & countrymen, ​ I wanna share some learnings from teaching my first "online course" last month. I made just a smidge over $100k for the month (not bad!). ​ I put the $$$

The 3 Biggest Myths About 4-Day Workweeks

Tuesday, July 27, 2021

Tuesday, July 27, 2021 Lead A New Report Reveals How Businesses Should Address DEI Hiring Efforts in the Post-Pandemic Age HR/Benefits The 3 Biggest Myths About 4-Day Workweeks, According to a CEO Who

💎 5 Tweet Tuesday 💎 - Shaan's favorite tweets this week

Tuesday, July 27, 2021

SHAAN'S 5 TWEET TUESDAY Back again with 💎 My 5 Favorite Tweets 💎 of the week. #1 💎 Mario Gabriele 🦊 @mariodgabriele Harvard Business School is an incredible media company. - $262M in 2020

July 27 - Target reports diversity progress | Fabletics is ThredUp's next partner

Tuesday, July 27, 2021

Fabletics launches resale program; Target reports 25% increase in Black representation at the officer level; Stores may soon use one-third of their space for e-commerce fulfillment: report; Bed Bath

6 building blocks of digital marketing campaigns + how to use them

Tuesday, July 27, 2021 Creative Content Marketing Agency The Content Marketer Today, we're showing how to build effective digital marketing campaigns, differentiating between inbound and outbound marketing,

Ecommerce Business Builders Summit

Tuesday, July 27, 2021

Hi Reader, Join me today at the Ecommerce Builders Summit where I'll be talking about Effective Strategies to Send External Traffic to Amazon (and Why It's So Important). In addition to my