Quick hitters: - We just launched a live version of our Private Equity Barometer, which features the 14 macroeconomic, credit and equity indicators that explain much of the variance in quarterly returns. Check it out and save it to your bookmarks!
- Don't forget to take our Sustainable Investing Survey, which covers topics like ESG risk factors and impact investing. (We have prizes!)
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| Analyzing where the unit economics of autonomous mobility doesn't add up | | Heavier traffic. Double-parked vehicles. Challenging intersections. Unpredictable cyclist and pedestrian behavior. Relative to lower-density areas, operating autonomous vehicles in dense cities presents many complications. At the same time, we show in our new research that the bulk of the revenue and profit opportunity for robotaxis is most likely to be found in dense cities—where trips are frequent and prices are high. In less-dense cities, where car ownership is popular, the profit opportunity is constrained by limited utilization.  One implication of this analysis: rumors of the demise of personal vehicle ownership may be greatly exaggerated. The unit economics of autonomous mobility simply don't make it a compelling prospect for people in suburban and rural areas. So, when exactly can we expect to see more robotaxis on the road? We expect autonomous technology to achieve "super-human" performance at the end of this decade. As this occurs, people in dense cities will likely sign up for subscriptions to robotaxi services offered by the likes of Waymo, Cruise and Zoox. At the same time, people in less-dense cities, suburbs, and rural areas will probably opt for personally owned autonomous cars. As 73% of American households describe their neighborhoods as suburban or rural, it's perhaps no surprise that both Waymo and Cruise have recently floated the idea of selling personally owned options. Just last month, Waymo raised $2.5 billion in fresh funding, thereby bringing the company's total amount raised to more than $5.7 billion. We believe such an aggressive raise suggests Waymo is gearing up to expand its service to additional locations. While years of operating subscale in a limited suburban location has helped to advance Waymo's technology, it hasn't led to a commercially viable model. As a result, we expect the company is preparing to transition to a larger, more densely populated city—likely San Francisco, where higher ride volume can drive better operating metrics, and where it would come into more direct competition with Cruise and Zoox:
Feel free to reach out to me or our institutional research group with any feedback or questions.
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Exploring Global PE Multiples by Sector
Continuing an ongoing analysis of PE buyout multiples, our most recent research on the topic breaks down the data by sector: information technology, healthcare and B2C, specifically.
While prices have generally risen across the board, IT has proven most expensive—the median EV/EBITDA multiple has doubled over the past decade, peaking at 20x in 2020.
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Healthcare multiples are up about 50% in the same period, though subsector is a huge factor as the effects of the pandemic continue to impact different offerings in different ways (e.g., in-patient elective care vs. telemedicine).
Last year, buyout multiples for consumer businesses dipped sharply to their lowest levels since 2014.
To dive deeper, we break down the causes for these disparities and project what the future may hold: | | | | | | Gut Health Research Opens Market Opportunities
Research into the gut microbiome didn't start in earnest until around 2007 or so, which makes it quite difficult to gauge the future of the market.
And while early findings have been promising, new discoveries at any point could make or break the commercial future of the gut health industry.
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That said, a number of startups are already directly addressing the opportunity through at-home gut health tests, providing solutions like personalized health recommendations or probiotic supplements.
Our new research covers all you need to know about the key startups in the space, what's driving the industry forward, how the gut microbiome fits into the broader world of personalized medicine, and what challenges stand in the way: | | | | | | The Emerging Baltic VC Ecosystem
Although the Baltic nations of Estonia, Latvia and Lithuania may not yet possess the financial clout of other VC powerhouse countries, record deal-value figures in the last two years are a sign that VC is growing as a strategy in the region.
Government policies such as stock options and visa programs within the Baltic nations appear to embrace VC and technological disruption as major growth areas.
Low living and labor costs are also notable benefits for founders starting businesses, companies on hiring sprees, or investors with limited capital resources in the region.
Our analyst note explores the Baltic VC ecosystem from a high-level perspective, covering VC activity, the factors influencing opportunities in the region, and how investment could fare in the future: | | | | | |
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If it feels like our latest Benchmarks are here earlier than ever, it should.
They are. Much earlier, in fact.
This latest edition is ready a month before initially scheduled as we continue to improve the timeliness, scope and usefulness of our quarterly performance updates. We've also added new data visualizations to expand beyond just medians to show quartile and decile ranges dating to 2000.
For a reminder, we break down our Benchmarks into the following editions: - Global (includes prelim Q1 data!)
- North America
- Europe
- Private equity
- Venture capital
- Secondaries
- Funds-of-funds
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Health and wellness tech analyst Kaia Colban weighs in on a $220 million round for fitness benefits unicorn GymPass, which doubled the company's valuation:
"This Series E raises GymPass' valuation to $2.2 billion, the largest valuation tracked among all fitness application providers and the second largest valuation among corporate distribution-focused startups behind Babylon Health's $3.97 billion valuation.
"Babylon Health's platform focuses on improving access to medical care, not fitness, and thus does not compete with GymPass.
"The fitness marketplace industry experienced a large hurdle when COVID-19 required gyms and fitness studios to close their doors.
"However, several marketplaces successfully adapted their platforms to provide digital wellness resources, such as virtual workouts and mental health and nutrition services.
"Now, as people return to gyms and studios, fitness marketplaces are receiving renewed investor interest.
"As reported, GymPass competitor ClassPass may be in talks to be acquired by MindBody.”
| | Kaia Colban
Emerging Tech Analyst
Health & Wellness Tech | | | | | |
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Our insights and data featured in the press: - 2021 is a unicorn frenzy. "This is possibly one of the most founder-friendly periods we've seen in several years," says VC analyst Joshua Chao. [Morning Brew]
- Private equity is giving a lot of love to SaaS and enterprise tech targets, our data shows. Analyst Rebecca Springer says PEGs are also using a more creative playbook to their benefit. [Protocol]
- Venture-backed grocery companies have already raised more capital in 2021 than they did in all of last year, according to our data. [CNBC]
- Morrisons might not be the only UK-listed retailer that's attractive to PE buyers. EMEA analyst Dominick Mondesir sees "plenty of secular tailwinds" that might spur a trend. [Citywire]
If you're a media member interested in interviewing our analysts, contact our PR team. | | | | | |
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Highlights from our other research content published over the past few months:
Market updates Thematic research Emerging Technology Research (report previews) Coming next week (subject to change) - Vertical Snapshot: Space Tech (client only)
- Does an Allocation to PE Add Value?
- Analyzing VC Returns for Nontraditional Investors
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| | Since yesterday, the PitchBook Platform added: | | 468 Deals | 1532 People | 512 Companies | 17 Funds | | | | | | |
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