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In today's Daily Pitch, you'll find:
- Our latest Quantitative Perspectives report, featuring nearly 50 pages of data and charts detailing US PE's recovery—and beyond.
- The SEC's SPAC scrutiny has ensnared a pair of high-profile deals as part of an ongoing push to increase investor protections.
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US PE moves beyond recovery and into the unknown
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As the two-year anniversary of COVID-19's emergence looms, the world is adjusting to a new normal. For financial assets and economies, that means a dramatic pace of activity—firmly establishing the markets' move beyond the recovery stage.
Lately, US private equity has experienced its fastest pace of deal and exit activity in at least two decades, according to our latest Quantitative Perspectives report, which features nearly 50 pages of data and charts. Among the takeaways:
- Strong activity within tech and business products & services has driven the majority of the surge in PE deal value.
- Aggregate exit value has spiked in 2021, driven by the increasing valuations across all exit types—but especially public listings.
- The 10 largest funds accounted for almost one-third of all capital raised in 2021, as larger funds continue to dominate the market.
- Institutional investors' long-term expectations point to a challenging period ahead, as the strong recent returns have likely come at the expense of future returns.
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SEC's SPAC scrutiny ensnares marquee deals
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(Courtesy of Lucid Motors) |
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A pair of high-profile blank-check deals are being investigated by the SEC as part of an ongoing push to increase investor protections related to SPACs.
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Both the SEC and the FINRA are probing an ongoing merger between Donald Trump's new media venture and Digital World Acquisition Corp., a blank-check company. The former president reportedly met with DWAC CEO Patrick Orlando prior to the SPAC's IPO, an action that could violate SEC rules.
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The SEC also subpoenaed documents from electric carmaker Lucid Motors, which said that the regulator appeared interested in business projections and statements tied to its $4.4 billion deal to combine with Churchill Capital Corp. IV earlier this year. The SEC previously opened investigations into the SPAC mergers of EV makers Canoo and Lordstown Motors, and it charged the founder of Nikola with fraud.
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Concerns over forward-looking projections, conflicts of interest and other risks have been at the heart of the SEC's push for enhanced disclosures in SPAC deals.
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The actions come ahead of an expected wave of such mergers: More than 600 US blank-check companies are either seeking a deal or in the process of closing one, according to PitchBook data.
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A message from the National Science Foundation
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Stanford University spinout Novome Biotechnologies, which engineers microbes to help treat chronic disease, recently struck a $605 million deal to genetically engineer microbial medications.
Novome Biotechnologies (NSF-1648230) is one of hundreds of deep tech startups funded annually by the National Science Foundation, a government agency that plays a central role in accelerating discoveries into the marketplace.
Each startup can receive up to $2 million to support translational R&D. By investing roughly $200 million in startups annually, NSF helps teams navigate the earliest stages of technology translation. In the past five years, these companies have gone on to raise billions in follow-on capital, and the portfolio has had 100+ exits.
Learn more about NSF funding at seedfund.nsf.gov |
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Temasek-backed BenevolentAI to go public via SPAC
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| (MF3d/Getty Images) |
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BenevolentAI, a UK drug discovery startup, plans to go public via a merger with Odyssey, a SPAC, in a deal the values the company at €1.5 billion (about $1.7 billion).
BenevolentAI will raise €390 million after transaction costs. The company will get €300 million from Odyssey, which listed in Amsterdam in July, and another €135 million via private placement from existing investors including Singapore state-backed investment fund Temasek and pharma giant AstraZeneca.
Founded in 2013, BenevolentAI has developed an AI-based platform that helps deliver novel drug candidates that have a better chance of clinical success than those developed using traditional means. The company raised $90 million from Temasek in late 2019 at a $1 billion valuation.
Odyssey, which was launched by Michael Zaoui and Yoel Zaoui, targets investments in the European healthcare and technology, media and telecom sectors. It was the 11th SPAC to go public on the Euronext markets in 2021, which has been a record year for European SPAC listings. |
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On the podcast: How tech is helping the global supply chain to evolve
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This week on "In Visible Capital," we talk about the state of the supply chain with PitchBook senior emerging tech analyst Asad Hussain, who recently published the Q3 update of our Emerging Tech Research on the supply chain tech sector.
Hussain discusses opportunities in maritime innovation, supply chain visibility, risk management and more. Then, we revisit an episode published earlier this year featuring an expert discussion on the latest logistics technologies. |
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Fueled by cheap power, empty plants and few regulations, crypto miners are descending on New York's former industrial towns. The environmental impact could be devastating. [The New York Times]
Calpers is turning to private equity and leverage to boost returns and reduce risk, but industry experts are mixed on whether it will work. [Institutional Investor]
China won't be able to meet its environmental goals without connecting its sources of renewable energy with its coastal mega-cities. The result will likely be both ugly and expensive. [Bloomberg] |
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Since yesterday, the PitchBook Platform added:
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62
VC valuations
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2711
People
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678
Companies
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29
Funds
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2017 Vintage Global Real Estate Funds
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Breaking down the key venture capital trends in blockchain
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Venture financing in the blockchain space has been garnering so much attention recently, as blockchain and cryptocurrencies have offered a glimpse into how these technologies can reshape the digital world.
Beyond the eye-catching headlines on NFTs, many blockchain-enabled businesses are growing rapidly and forging the future of what is commonly referred to as Web3.
In its inaugural market review, Blockchain & Venture Capital: Breaking Down Key Trends, Forte uses PitchBook's data sets to break down key trends across the space. Highlights include:
- A summary of important industry and regulatory trends.
- Metrics on venture funding such as valuations and deal sizes.
- A market map segmenting the ecosystem.
Read it now |
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Lyft CFO Brian Roberts leaves for crypto startup OpenSea
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| NFT trading marketplace OpenSea has hired Brian Roberts as CFO, a position he has held at Lyft since 2014. OpenSea was valued at $1.5 billion this summer, and The Information reported that the company received offers to raise another round at a $10 billion valuation. |
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Christina Melas-Kyriazi joins Bain Capital Ventures
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Salesforce Ventures leads $580M round for Genesys
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Africa's TradeDepot collects $110M
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| TradeDepot, a B2B marketplace for consumer goods producers, importers and local manufacturers, has raised $110 million in new funding that will be used to expand the Nigeria-based startup's buy now, pay later service across the continent. The round reportedly consists of equity funding led by IFC, with participation from Novastar, Sahel Capital, CDC Group, Endeavor Catalyst, MSA Capital and Partech, as well as debt financing provided by Arcadia Funds. |
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Hometap welcomes $60M in new funding
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Sense raises $50M from SoftBank
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| Sense, the creator of an AI-backed talent recruitment and communications platform, has raised a $50 million Series D led by SoftBank's Vision Fund 2. The new capital values the San Francisco-based company at $500 million, TechCrunch reported. Sense has now raised a total of $90 million in private funding, including a $16 million Series C announced in June. |
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Mysten Labs snags $36M Series A led by a16z
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| Stacked, the developer of a crypto investment platform, has reportedly raised a $35 million round led by Alameda Research and Mirana Ventures, with participation from other investors. Based in Chicago, the startup's tech lets users manage their assets and invest in pre-built portfolios and strategies from hedge funds and traders. |
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Canopy nabs additional $35M
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Delivery Hero curbed in attempt to buy The Chefz
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| Berlin-based Delivery Hero has been blocked in its latest attempt to buy Saudi Arabia-based competitor The Chefz after the Saudi General Authority for Competition denied the takeover bid, Bloomberg reported. The Chefz reportedly raised a funding round in 2019 from Saudi investors including Vision Ventures. The startup said the talks are still ongoing, according to the report. |
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10X Capital SPAC pares IPO estimate
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| A SPAC formed by 10X Capital, dubbed 10X Capital Venture Acquisition III, has lowered the proposed deal size for its upcoming IPO. The tech-targeting SPAC now plans to raise $250 million by offering 25 million shares priced at $10 apiece, after originally planning to sell 35 million shares at $10 apiece. |
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