| | | | | VC deals and Trumpism: How much changed in four years? | |  | | Inauguration Day, 2016 (Rob Carr/Getty Images) | | | Donald Trump moved into the White House four years ago as Americans debated a growing divide between the so-called coastal elites and basically everybody else. Trump's populist rise to power came as a rude awakening to the venture capital industry, which has concentrated its investments on coastal tech hubs, and to Silicon Valley, a progressive-leaning place where his rival had more support. - The dearth of VC activity in America's heartland symbolized discontent—and a disconnect—with the heavily funded, rapidly growing technology industry. "The reason they feel left behind is because they have been left behind," said Steve Case, whose Revolution Ventures seed fund focuses on deals outside the big tech hubs.
- Some investors sought to address that gap on several fronts. They earmarked capital for underserved parts of the country, promoted new tech hubs and ventured outside their bubbles to extend their networks. But did the overall investment picture change?
- Not very much, according to PitchBook data. For all the talk of boosting VC investment in the heartland, the yearly share of total capital deployed in the US has remained about 18%, excluding deals done in states with the biggest tech hubs. That's about the same as it was before Trump was elected.
- Seen through an electoral lens, some major battleground states that Trump won twice did see significant investment gains in absolute terms. In 2020, Texas startups pulled in $3.74 billion through Nov. 10, up from $2.12 billion in 2016.
- Several key states that Joe Biden flipped to his column—like Pennsylvania, Georgia and Michigan—all steadily attracted more venture capital since Trump was elected.
- Despite Trump's populist backing, his administration was long on "photo ops" but didn't make a big commitment to reordering the investment landscape, says Case, adding: "Given the bloc that put him in the White House that was so frustrated around jobs, I was surprised there wasn't more of a response." —Alexander Davis
| | | | | | | | | | European PE hits new heights after a prompt pandemic recovery | | Aided by trillions of euros in monetary stimulus and billions in stockpiled dry powder, private equity investors in Europe were able to swiftly bounce back from the initial seizure of market uncertainty that accompanied the onset of the pandemic in the first half of last year. In fact, by the end of 2020, Europe's PE industry was in the process of wrapping up its busiest quarter on record.
Our 2020 Annual European Breakdown examines the many factors that contributed to this rapid recuperation. The report also scopes out other significant shifts in the industry during the past 12 months, including a proliferation of IT deals, the rise of SPACs and these other key takeaways: - The average size of European PE funds continued to climb, topping €1 billion for the first time
- Exit count in Europe reached an eight-year low, but there are signs activity could recover in 2021
- Bolt-ons accounted for 61.4% of European buyout activity in 2020, a record rate
| | | | | | | | | | A message from KEY Investment Partners | | | | Breaking down how US election results may hold implications for cannabis investors | | The 2020 US election resulted in a "blue wave," with Democrats taking control of the presidency and both chambers of Congress. That blue wave has accelerated the timeline by which industry experts expect cannabis to be legalized federally. But why was cannabis made illegal in the first place? Where does the legislative framework stand today, and exactly how and when should you expect prohibition to be repealed federally?
In this white paper, KEY discusses the nuanced regulatory framework that developed over the last 25 years as prohibition has unwound. Next, they dive into the implications of the 2020 election and the path to federal legalization. Finally, KEY addresses the election results' implications for investors and why now is the time to deploy capital into cannabis.
Read it now | | | | | | | | | | Cruise, Rivian raise billions to ready technology for the road | |  | | Cruise brought home a $30 billion valuation with its latest round. (Courtesy of Cruise) | | | Against a grim outlook for gas-powered cars, electric truck maker Rivian and self-driving vehicle company Cruise have landed more than $2 billion apiece from investors.
For Rivian, the huge haul will power an imminent rollout of three new models. Cruise's cash is also inspired by a push toward commercialization, a longer-term goal that appears increasingly within reach. | | | | | | | | | | Remote working undermines London's European tech hub status | |  | | (SDI Productions/Getty Images) | | | London has long been a hub for tech startups, which flocked to the thriving venture ecosystem despite the high price of doing business in one of Europe's most expensive locales.
But as the pandemic has forced a shift to remote work, there has been an exodus of talent from the city—and some don't plan to come back. | | | | | | | | | | Office Depot denies Staples, Sycamore | |  | | Office Depot and OfficeMax combined in a $1.2 billion deal in 2013. (Justin Sullivan/Getty Images) | | | The parent of Office Depot and OfficeMax has rejected an acquisition offer from Staples worth $2.1 billion in cash, or $40 per share. But there may still be hope for a deal of a different sort between the rival office-supply retailers, as the board of parent company ODP said it could be open to a joint venture or a sale of its retail and consumer-facing ecommerce units to Staples. The board said such alternatives could also raise fewer regulatory questions than a full acquisition.
Staples has long pursued Office Depot. An original takeover bid launched in 1997 was blocked by antitrust regulations. Staples tried again with a $6.3 billion agreement in 2016, three years after Office Depot acquired OfficeMax, but the Federal Trade Commission blocked it again. Staples' latest proposal comes with backing from Sycamore Partners, which acquired the company for $6.9 billion in 2017. | | | | | | | | | | Where will your firm rank in PitchBook's Global League Tables? | | More than 25,000 firms coordinate with us in order to ensure the deals they accomplish appear in the PitchBook Platform. Where will your firm end up?
Reach out to connect@pitchbook.com to get your deals properly credited, so you may feature in our industry, region and deal type rankings. | | | | | | | | | | It hasn't exactly been a climate revolution. But 2020 may have marked a turning point for the better in our battle to save the planet. [Intelligencer]
Mastering the software, rather than the hardware, has proved to be the biggest challenge in Volkswagen's $50 billion bid to unseat Tesla. [The Wall Street Journal]
The tale of how one intrepid war crimes detective helped end a decades-long hunt for Felicien Kabuga, an architect of the nightmarish genocide in Rwanda. [GQ] | | | | | | | | | | | Since yesterday, the PitchBook Platform added: | | 497 Deals | 1932 People | 725 Companies | 11 Funds | | | | | | | | | | | | | | | | | | | | 2012 Vintage Global Venture Funds | | | | | | | | | | | Littlejohn appoints new MD | | | | | | | | | GoldPoint co-founder joins Gryphon | | | | | | | | | New State unveils slate of hires | | | | | | | | | | | Payments company raises unicorn round | | | | | | | | | Telemedicine startup collects $132M | | | K Health has raised $132 million in a Series E co-led by GGV Capital and Valor Equity Partners. LTS Investments and the pension fund of Kaiser Permanente also participated in the round, which values the New York-based company at $1.5 billion, TechCrunch reported. K Health is the developer of a telemedicine platform that helps primary care patients connect with physicians and manage treatment plans. The startup was valued at $807 million in November, according to PitchBook data. | | | | | | | | Volta recharges with $125M | | | Electric vehicle charging startup Volta has raised $125 million from investors including Energize Ventures. The San Francisco-based company partners with retailers like Albertsons, Regency Centers and Topgolf, and will use the funds in part to expand internationally. Volta has raised over $200 million to date. | | | | | | | | Aledade picks up $100M for healthcare platform | | | Aledade has raised a $100 million Series D led by Meritech Capital, with participation from Tiger Global, IVP and OMERS Growth Equity. Founded in 2014, the company provides independent primary care practices, health centers and clinics with a platform to manage their data and workflows. Aledade was valued at $714 million in April with a $64 million round, according to PitchBook data. | | | | | | | | DevOps automation startup Quali lands $54M | | | Quali, a developer of cloud automation software for DevOps teams, has secured $54 million in a new round co-led by Greenfield Partners and JVP. During the pandemic, the Austin-based startup has experienced significant growth; it plans to nearly double its employee count. Quali's customers include Cisco, Microsoft, Dell and Verizon. | | | | | | | | Lightspeed leads $35M round in Brigit | | | Brigit has raised a $35 million Series A led by Lightspeed. Other investors that took part in the funding round include DCM, Ashton Kutcher's Sound Ventures and Canaan. Brigit provides a consumer finance app that offers budgeting tools, automated alerts and interest-free cash advances. | | | | | | | | | | Ardian, GIP enter fray with Suez, Veolia | | | Ardian and Global Infrastructure Partners have sent a letter to Suez indicating their willingness to make a friendly acquisition offer for the French water utility giant, presenting a possible alternative to a contentious takeover battle between Suez and fellow water utility powerhouse Veolia Environment. Veolia, which owns 29.9% of Suez and is trying to acquire the rest of the company, said its stake in its rival is not for sale. Suez has thus far declined to engage in talks with Veolia over a preliminary takeover bid. | | | | | | | | CVC Capital Partners circling Birkenstock in possible $4.9B+ deal | | | CVC Capital Partners has entered advanced negotiations to acquire Birkenstock in a deal that could value the German sandal maker at over €4 billion (about $4.9 billion), Bloomberg reported. The news comes after CVC reportedly closed a €21.3 billion flagship fund last July. | | | | | | | | Advent, Great Hill recap RxBenefits in $1.1B deal | | | Advent International and Great Hill Partners have recapitalized RxBenefits in a deal that values the Birmingham, Ala.-based provider of pharmacy benefit services for employers at around $1.1 billion. Advent and Great Hill will now hold equal stakes in RxBenefits, with the company's management team also making a significant investment. Great Hill has backed RxBenefits since 2016. | | | | | | | | AE Industrial backs Oakman Aerospace add-on | | | Redwire, a provider of aerospace components, has acquired Oakman Aerospace, a Colorado-based provider of products and services for spacecraft and satellite design and other digital engineering services. AE Industrial Partners has backed Redwire since last June. | | | | | | | | Pritzker reups with ProAmpac | | | Pritzker Private Capital has made a new investment in ProAmpac, a flexible packaging company based in Cincinnati that the firm has owned since 2016. GIC, company management and other investors also took part in the new deal. | | | | | | | | | | PE firms prepare to back cleaning IPO | | | PurposeBuilt Brands, an owner of various cleaning and disinfectant brands that's backed by The Carlyle Group and TA Associates, has filed to go public on the Nasdaq. PurposeBuilt's portfolio includes the Weiman, Goo Gone and Wright's cleaning brands. Carlyle and TA Associates bought the company, which was formerly known as Weiman Products, from Cortec Group in 2019. | | | | | | | | Blackstone-backed Apria files for IPO | | | Apria, a provider of home healthcare equipment, has registered for an IPO that Renaissance Capital says could raise up to $800 million. Blackstone has backed Apria since taking the California-based company private in 2008 for $1.7 billion, including debt. Apria plans to list on the Nasdaq under the symbol APR. | | | | | | | | | | Chicago-based firm secures $306M | | | Sheridan Capital Partners has closed its second buyout fund on $306 million. Based in Chicago, Sheridan primarily pursues lower-middle-market investments in the healthcare sector. The new fund will focus on majority transactions. | | | | | | | | | | | | | | | | | | Who's in the newsletter today? | | People | | | | Investors | | | | Companies | | | | Limited Partners | | | | | | | | | | | | | |
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