| | | | | From mealworms to mushrooms: 10 VC deals you might have missed in 2020 | |  | | (Megan Woodard/PitchBook) | | | Though it had its ups and downs, 2020 wasn't as rough on the venture capital dealmaking scene as some might have expected. The year sparked a series of deals involving early-stage entrepreneurs crafting unique—and sometimes strange—technologies.
From farming insects for animal feed to treating depression with a hallucinogenic compound, the startups are distinct in their own ways. But they have one thing in common: They made significant strides in 2020, and those strides deserve a second look. | | | | | | | | | | Add-ons, easy credit aid resilience in the US middle market | | Totals for both deal count and deal value in the US middle market have increased in each of the past four years. That run will almost surely end in 2020. But the market has still displayed surprising durability during the pandemic, with dealmaking numbers on track to finish well above what many predicted back in March and April.
PitchBook's Q3 2020 US PE Middle Market Report, sponsored by Antares Capital and GLG and presented in partnership with ACG, offers a detailed look at this resilience and the many other trends afoot in the US middle market, including how easily available credit and Fed stimulus are helping grease the wheels of dealmaking. Other key takeaways include: - Middle-market fundraising totals are on pace to fall short of $100 billion for the first time since 2015
- Add-ons have grown increasingly popular in 2020 as a perceived way to reduce risk
- For the first time since 2009, there has been a substantial reduction in sponsor-to-sponsor exit activity
| | | | | | | | | | A message from SS&C Intralinks | | | | Remote working is a done deal. How are you getting deals done? | | There's no going back. Pandemic-driven work restrictions are a reality, at least for the foreseeable future. How are dealmakers adapting—especially under the pressures of seismic shifts in the markets, fewer quality assets and increasing competition among buyers?
Download our new e-book, How integrated tech is helping top M&A teams get the deal done. You'll get a clear snapshot of the new dealmaking landscape, and see how AI-enhanced tech solutions are evolving ahead of the pandemic, keeping teams productive and deals on track.
Discover how the top M&A teams are leveraging integrated technology to get a clear advantage—get the e-book now. | | | | | | | | | | 12 emerging tech predictions for 2021 | |  | Starship's self-driving pods making last-mile deliveries in the UK.
(Leon Neal/Getty Images) | | | 2020 has been a wild ride in emerging technology. Various sectors experienced vastly different pandemic impacts, with some setting funding records and others facing record headwinds.
What will 2021 bring? That depends on the industry in question, but according to our analysts' predictions for the emerging tech ecosystem, there's a lot to look forward to next year. Highlights include: - In supply chain tech, last-mile delivery platforms are primed for major IPOs
- Digital therapeutics startups will raise a record level of venture funding
- The remote work trend will create significant exit opportunities in cloudtech and DevOps
- Five information security unicorns will go public
| | | | | | | | | | Tech IPO party winds down with Wish, Upstart debuts | | Shopping app creator Wish and online lender Upstart began trading on Wednesday to mixed reception from public investors, following a week of sensational debuts from Airbnb, DoorDash and C3.ai.
Wish stock fell more than 16% from its IPO price of $24 per share, finishing its first trading day at $20.05 per share. That closing stock price gave the ecommerce company an initial market cap of about $13.6 billion.
Wish raised around $1.1 billion in its IPO and recorded $1.9 billion in 2019 revenue. But the company has seen losses and 2020 growth that lags behind much larger competitors like Amazon and Walmart. Wish received previous private funding from backers including DST Global, Founders Fund, Formation 8 and GGV Capital.
Upstart, meanwhile, raised over $240 million in its IPO after pricing at $20 per share, the bottom of its expected range. But the personal loan provider's stock rose in its trading debut to finish up 47% at $29.47 apiece, notching a market cap of around $2.1 billion. Third Point Ventures, Stone Ridge, Khosla Ventures and Rakuten are among those that had provided prior private funding to Upstart.
No more large US tech IPOs are expected in 2020 after a December deluge that set records and wrapped a year of experimentation. | | | | | | | | | | Bolt bags $182M in a strong year for European ridehailing rounds | |  | | Bolt CEO Markus Villig (Courtesy of Bolt) | | | Estonian Uber rival Bolt has raised €150 million (about $182 million) in a round led by D1 Capital Partners. The startup's biggest fundraise yet brings the total amount of venture funding raised by European ridehailing companies in 2020 to over $1 billion, according to PitchBook data.
Despite last month reporting an €85 million loss for 2019, Bolt has doubled its number of customers this year after launching in 50 new cities, CEO Markus Villig said. The company, which rebranded from Taxify, is expanding to cover 200 cities in Europe and Africa.
The pandemic has been something of a double-edged sword for the ridehailing industry. While ongoing lockdowns have severely lowered the demand for rides, those who travel are likely to seek alternatives to public transportation, and consumers' dependence on home deliveries has skyrocketed. Bolt launched a food delivery business called Bolt Food in 2019, which has contributed to the company's growth.
"It is refreshing to see, considering micromobility companies such as Lime and Bird have retreated from markets in 2020," said PitchBook analyst Nalin Patel. "Startups offering vehicle ridehailing have had a difficult year, too, and capturing market share in the growing food delivery sector could be the near-term focus for many incumbents completing rounds."
The $1 billion-plus raised by European ridehailing startups in 2020 marks a notable uptick from last year's $429 million, but one that comes with a caveat. Two deals significantly moved the needle: a $275 million Series C for air mobility startup Lilium and a $211 million round in TIER Mobility led by SoftBank. | | | | | | | | | | After years of intense anticipation among gamers, "Cyberpunk 2077" was released last week. It did not go how anyone expected. [Wired]
KKR and Blackstone's connections to surprise medical billing in the US have been well documented. Is the saga on the brink of a surprising conclusion? [The American Prospect]
As the official start of winter approaches, a worrying prospect has emerged for children across the US: Online learning could mean the end of the snow day. [The Wall Street Journal] | | | | | | | | | | | Since yesterday, the PitchBook Platform added: | | 468 Deals | 1637 People | 511 Companies | 11 Funds | | | | | | | | | | | | | | | | | | | | 2008 Vintage Global Real Assets Funds | | | | | | | | | | | CD&R appoints new partner | | | Clayton, Dubilier & Rice has promoted Kevin Smith to partner. Smith has worked at the New York-based private equity firm since 2011, with a focus on fundraising and investor relations. He was a managing director at Lehman Brothers before joining CD&R. | | | | | | | | Greg Smithies joins Fifth Wall as climate partner | | | Fifth Wall has named Greg Smithies as a partner to co-lead the venture capital firm's climate practice. He previously led BMWi Ventures' sustainability practice. In other hires, the firm named Ravali Parsa a vice president focused on growth and investor relations. G.M. Nicholas "Magnus" Vik joined Fifth Wall as a VP for strategy and operations. | | | | | | | | | | | | StockX doubles value with mega-round | | | StockX, the provider of an online marketplace for sneakers, apparel, electronics, accessories and collectibles, has more than doubled its valuation to $2.8 billion after raising a $275 million Series E led by Tiger Global. The startup was worth $1.3 billion in June, according to PitchBook data. StockX's revenue surged over 75% year-over-year in Q3, reaching more than $100 million. Altimeter Capital, Sands Capital, and Whale Rock Capital Management also took part in the financing. | | | | | | | | Neuron23 emerges from stealth with $113.5M | | | | | | | | | BigID secures $70M Series D | | | BigID has raised $70 million in a round co-led by Salesforce Ventures and Tiger Global. The funding values the startup at north of $1 billion. The New York-based company uses machine learning and identity intelligence to help enterprises protect customer and employee data. BigID raised $50 million at a $625 million valuation in January, according to PitchBook data. | | | | | | | | Insurtech startup Bestow collects $70M | | | Bestow has raised a $70 million Series C from investors including Breyer Capital, Valar Ventures, NEA and Core Innovation Ventures. The Dallas-based company offers a platform that uses AI to manage life insurance products. Bestow was valued at $200 million in February, according to PitchBook data. | | | | | | | | | | Vistria, HCAP link on healthcare deal | | | The Vistria Group has acquired a stake in San Diego-based Mission Healthcare from HCAP Partners, a rapid turnaround from HCAP's initial investment in April 2019. Mission Healthcare is a provider of home health and hospice services operating in Southern California. | | | | | | | | Tailwind takes over ArrowStream in SBO | | | Tailwind Capital has acquired ArrowStream, a provider of supply chain management software to the foodservice industry, from Diversis Capital, which purchased the Chicago-based company in 2017. Based in New York, Tailwind typically invests in middle-market companies in the healthcare, tech, business services and industrial services sectors. | | | | | | | | Partners Group pledges $250M+ to Ecom | | | Partners Group has agreed to pay more than $250 million for a minority stake in Ecom Express, an ecommerce logistics company operating across India. Fellow private equity firm Warburg Pincus has owned a stake in Ecom since 2015. | | | | | | | | Silversmith stakes computer vision specialist | | | Silversmith Capital Partners has led a $60 million minority investment in Microblink, a developer of AI-powered computer vision software. The deal represents the first outside funding for the London-based company since it was founded in 2013. | | | | | | | | Knox Lane backs Fingerpaint | | | Knox Lane has made a growth investment in Fingerpaint, a marketing agency for healthcare clients specializing in pharmaceuticals, gene therapy and rare diseases. Fingerpaint founder and CEO Ed Mitzen and the company's management team will remain investors as part of the deal. | | | | | | | | | | Massachusetts accuses Robinhood of manipulating investors | | | Robinhood is the subject of a complaint submitted by Massachusetts securities regulators that argues the stock-trading app creator used aggressive marketing and "gamification" tactics to attract and retain inexperienced investors while failing to protect them. In doing so, Robinhood breached its fiduciary duty and exposed investors to "unnecessary trading risks," such as those posed by options trading, the complaint alleges. Robinhood is said to be pursuing an IPO as soon as the first quarter of next year. | | | | | | | | Luckin Coffee settles fraud charges for $180M | | | Luckin Coffee has reached a settlement agreement with the SEC over charges that the China-based company defrauded investors by stating false financial results, agreeing to pay a $180 million penalty. The SEC launched its investigation in April, alleging that the fast-growing coffee retailer had fabricated $300 million in sales. Luckin went public in May 2019, just a month after it had raised $150 million in venture funding at a $2.9 billion valuation, according to PitchBook data. | | | | | | | | | | Satellite broadband startup AST signs SPAC deal | | | AST SpaceMobile, which is developing a satellite-based mobile broadband network, has agreed to merge with blank-check company New Providence Acquisition in a deal that gives the combined entity an equity value of $1.8 billion. Existing AST investors Vodafone, Rakuten, American Tower and Cisneros will participate in a $230 million PIPE round alongside the merger. AST and Vodafone are partnering to launch the first phase of service in 2023. | | | | | | | | Advent preps Amsterdam IPO for InPost | | | Advent International is planning a potential listing in Amsterdam for parcel locker company InPost that could occur early next year, Reuters reported. Advent has owned InPost since 2017, and KKR invested in the company a year later. The IPO could value the Polish company at as much as €8 billion (about $9.8 billion). Bloomberg reported last month that several PE firms, including Blackstone and Silver Lake, had expressed interest in acquiring InPost. | | | | | | | | Vroom to buy retail car data startup for $120M | | | | | | | | | American Securities eyes $1B chemicals sale | | | American Securities is in talks to sell Emerald Kalama Chemical in a deal that could value the company at about $1 billion, Bloomberg reported. Emerald makes ingredients and preservatives for foods, cosmetics and other products. Potential suitors for the company reportedly include Lanxess, a fellow specialty chemicals company, as well as private equity firms HIG Capital, Rhone Capital and TPG Capital. American Securities has backed Emerald since 2014. | | | | | | | | | | Carlyle-backed firm raises $9B | | | AlpInvest Partners, a private equity secondaries investor owned by The Carlyle Group, has reportedly closed its latest fund on $9 billion, and raised an additional $1.2 billion for co-investments. AlpInvest collected a total of $6.5 billion for its most recent secondaries program in 2017. Carlyle has owned AlpInvest since 2011. | | | | | | | | | | Aphria, Tilray announce $3.9B cannabis combination | | | Canadian companies Aphria and Tilray have agreed to merge, creating a combined cannabis company with an equity value of some C$5 billion (about $3.9 billion). Current Aphria shareholders will receive about .84 shares of Tilray stock for each of their own shares, resulting in Aphria shareholders owning about 62% of the combined company. The two companies combined to post revenue of C$874 million over the past 12 months. | | | | | | | | Eli Lilly lands $1B deal in gene therapy space | | | Eli Lilly has agreed to purchase Prevail Therapeutics for total consideration of $26.50 per share, valuing the company at just over $1 billion. Based in New York, Prevail is a developer of gene therapies designed to target the root cause of Parkinson's disease and other neurodegenerative disorders. The price, which includes a contingent value right of $4 per share payable upon the first regulatory approval of a Prevail treatment, represents a 112% premium to Prevail's previous closing stock price. | | | | | | | | | | | | | | | | | | | | Who's in the newsletter today? | | People | | | | Investors | | | | Companies | | | | Service Providers | | | | | | | | | |
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