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| Why the Bay Area is still central to the future of VC | |  | | (Piriya Photography/Getty Images) | | | In recent years, the US venture industry has grown tremendously outside of the Bay Area—a shift accelerated by the pandemic. As weeks of working from home turned into months, questions grew about whether the sky-high prices of Silicon Valley were worth it, especially as cities like Austin and Miami stepped up to lure startups, employees and investors.
But growth in emerging markets isn't a sign of the Bay Area's decline, PitchBook analysts write in our latest research note. Despite an increasing flow of capital to other aspiring tech hubs, the region remains as central to the future of VC as ever: - LPs strongly favor Bay Area fundraising, which has topped $151 billion since the start of 2016—more than the rest of the US combined.
- More than 40% of US VC deal value in the past five years has gone to Bay Area-based companies.
- Silicon Valley produces the largest cohort of entrepreneurs in the country.
| | | | | | | | | | Foresite Capital's ambitions swell with mammoth healthcare fund | |  | | Foresite managing director Michael Rome co-leads the firm's therapeutics investing division. (Courtesy of Foresite Capital) | | | Foresite Capital has raised $969 million for its latest fund, an achievement that puts it in an elite league of life sciences investors. - The firm thinks the coronavirus will "fundamentally change" healthcare and has been an active backer of companies developing COVID-19 testing and treatment.
- Foresite recently joined the SPAC craze, taking Gemini Therapeutics public through its blank-check company earlier this month.
- At the same time, the San Francisco firm has grown its early-stage efforts through an in-house incubator headed by Verily co-founder Vikram Bajaj.
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| Sequoia collects $195M for latest seed fund | | Sequoia has launched its newest fund focused on seed-stage companies across the US and Europe, with Crunchbase reporting the vehicle has raised $195 million. - In 2019 and 2020, the firm made more new seed-stage investments than Series A deals. Sequoia closed its previous seed fund on $180 million in 2018, TechCrunch reported.
- Crunchbase reported that the new fund will also back investments made through the firm's Scout program, an initiative launched in 2009 that allows Sequoia to work with a network of individuals to source new early-stage investments in startups.
- Sequoia's seed investments include cybersecurity specialist Stairwell, alternative asset management company Alto, and Mira, an augmented reality company.
- While the pandemic presented challenges for emerging fund managers, 2020 was a robust year for more mature firms such as Sequoia. Established VC firms represented more than 70% of total fundraising for the first time since 2014, and that share is projected to exceed 75% in 2021, according to the Q4 2020 PitchBook-NVCA Venture Monitor.
| | | | | | | | | | On the podcast: Let's Talk About Race | | This week's "In Visible Capital" podcast features our recent discussion about race and the evolving role of investors addressing racial inequality. We're resurfacing this conversation because even as Black History Month comes to an end, the hard work to increase diversity in the markets continues. - We brought together four professionals to share their expertise on the topic: Lisa Lambert, head of National Grid Partners and former head of the Intel Diversity Fund; Barry Eggers, a founding partner at Lightspeed and chairman of the National Venture Capital Association; Angela Matheny, director of the diverse asset-manager program at Crewcial Partners; and Cynthia Muller, head of mission-driven investment with the WK Kellogg Foundation.
- Our guests discussed why it's so important from business and equality perspectives for investors to prioritize diversity and inclusion goals in both their own teams and in their portfolios.
- Subscribe to "In Visible Capital" wherever you get your podcasts, and look out for details on Season 3 coming soon.
| | | | | | | | | | These days, it's rare for US antitrust regulators to step in and stop a mega-merger. So what if legislators banned such deals altogether? [The Atlantic]
Clubhouse might be the next big thing in social media. But first, the company has some problems to solve. [The New York Times]
Breaking down some of the leading players from Europe in the worldwide race to make large-scale carbon capture technology a reality. [Sifted] | | | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 421 Deals | 1446 People | 351 Companies | 39 Funds | | | | | | |
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| 2013 Vintage Global Venture Funds | | | | | | |
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| BetterUp doubles valuation with new round | | | BetterUp, the developer of a mobile-based professional coaching platform, has raised $125 million. Led by Iconiq Growth, the funding values the startup at $1.73 billion. That's more than double the $710 million valuation the company had in 2019, according to PitchBook data. Returning investors like Lightspeed and new investors such as Salesforce Ventures and Mubadala joined the round. | | | | | | | | Terminus picks up $90M Series C | | | | | | | | | Otter.ai books $50M for transcription tech | | | | | | | | | Medication management startup collects $30M | | | | | | | | | | Cybersecurity startup Armorblox has raised $30 million in a round led by Next47, with participation from investors including Unusual Ventures, Polaris Partners and General Catalyst. The company is the provider of an email security platform intended to help organizations detect risks and manage targeted email attacks. Armorblox raised a $16.5 million Series A in 2019. | | | | | |
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| L Catterton eyes $4.9B deal for Birkenstock | | | L Catterton is nearing a purchase of German sandal maker Birkenstock in a deal that could value the company at around €4 billion (about $4.9 billion), Bloomberg reported. CVC Capital Partners has also expressed interest in acquiring the business, but Birkenstock's owners reportedly prefer L Catterton's track record of owning other family-backed consumer brands. | | | | | | | | TPG doles out $1.8B in blockbuster DirecTV deal | | | TPG Capital has agreed to purchase a 30% stake in DirecTV from telecom giant AT&T for $1.8 billion. The deal will create a new standalone DirecTV with an enterprise value of $16.25 billion, comprising the company's satellite TV operations, AT&T TV and U-Verse video services. AT&T will own 70% of the combined business and AT&T executive Bill Morrow will serve as CEO. | | | | | | | | Advent backs major payments merger | | | Clearent and Transaction Services Group, two providers of payments technology both backed by Advent International, have agreed to merge and form a new Atlanta-based company called Xplor Technologies. The company will have an enterprise value of $3 billion, Bloomberg reported. Advent has backed Clearent since 2018 and TSG since 2019. | | | | | | | | Diligent lines up $1B Galvanize add-on | | | Diligent has agreed to acquire Galvanize, a fellow provider of governance, risk and compliance software, in a deal that Forbes reports is worth around $1 billion. Insight Partners has backed Diligent since acquiring the company for some $624 million in 2016. | | | | | | | | Francisco Partners to buy MyHeritage for $600M | | | | | | | | | TPG takes controlling stake in NewQuest Capital | | | TPG Capital has acquired a majority stake in NewQuest Capital Partners, a secondaries private equity firm targeting the Asia-Pacific region. TPG originally backed NewQuest with a minority investment in 2018. | | | | | |
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| Coinbase to go public in Nasdaq direct listing | | | Coinbase has filed to go public on the Nasdaq via a direct listing. The cryptocurrency company revealed in its SEC filing that it doubled revenue last year and posted a profit. Coinbase had net revenue of $1.14 billion in 2020, up from $483 million the year before; it reported net income of $322.3 million last year after posting a loss of $30.4 million in 2019. | | | | | | | | 3D printer Markforged set for SPAC combination | | | Markforged, the provider of an industrial 3D printing platform for industries such as aerospace, healthcare and defense, has agreed to merge with One, a SPAC led by Eventbrite co-founder Kevin Hartz and sponsored by A-star. The combined company is expected to be worth $2.1 billion and receive up to $425 million in gross proceeds from the deal. Founded in 2013, Markforged was valued at $820 million in 2019, according to PitchBook data. The company has raised funding from backers such as M12, Matrix Partners and North Bridge Venture Partners. | | | | | |
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| Bessemer lands $3.3B across two new funds | | | Bessemer Venture Partners has brought in $3.3 billion for its latest funds. The vehicles are the firm's 11th flagship fund and its second opportunity fund. Bessemer also welcomed former Amazon executive Jeff Blackburn to its team and named four others as partners. | | | | | | | | Prelude Growth pulls in $250M | | | | | | | | | Lightbank closes $180M vehicle | | | Lightbank, a Chicago-based VC firm, has secured $180 million for its second early-stage venture fund. That brings the firm's total assets under management to $360 million. Lightbank has backed startups like Benzinga, Udemy and Contently, and will use the new fund to invest in sectors including internet, software and climate tech. | | | | | |
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"Deals sized over €25 million have largely propelled the astonishing growth in European deal value over the last decade, steadily gaining share of total annual deal value. They represented a record 61.8%, or €26.5 billion, of capital invested in 2020."
Source: PitchBook's 2020 Annual European Venture Report | | | | | |
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