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In today's Daily Pitch, you'll find: - Some PE investors are taking advantage of the cooling deals market to negotiate stronger indemnity provisions.
- Healthcare-focused companies, particularly those in digital health, continue to attract VC interest at a robust pace.
- Chart of the Day: Share of PE exit value by type, from our US PE Breakdown.
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| PE investors strengthen due diligence amid a cooling deals market | |  | | (Proxima Studio/Shutterstock) | | | Financial buyers have been taking more time to perform due diligence and, in some cases, have been negotiating stronger indemnity provisions to protect themselves against downside risks facing the assets they are looking to buy.
As the deals market cools amid sinking valuations and rising borrowing costs, sellers may see a smaller pool of suitors, making it easier for buyers to dig into a target's financial standing and negotiate better legal terms. | | | | | | | | | Move aside, crypto: Generative AI takes tech VC attention in Q3 | | Hype around text-to-image AI models in Q3 2022 helped draw rapid VC investment in the generative AI space. But this did not stop deal activity from falling for the overall AI and machine learning vertical, where deal value declined 46.7% quarter-over-quarter.
Our recent report on AI and machine learning tracks 68 product categories, and only 20 are on pace to grow in VC funding in 2022—led by intelligent robotics, supply chain optimization and conversational AI.
The report maps out the market and notes the emerging opportunities and startups to watch. Generative AI, neural search and inference semiconductors are finding traction and scooping up deals in the current market. Company spotlights on AI unicorns Databricks and DataRobot show their evolving M&A and partnership priorities. | | | | | | | |
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| A message from SS&C Intralinks | | |
| This just in: 200 LPs speak out on 2023 allocation plans | | The markets are shifting and so are investors' sentiments. In the new SS&C Intralinks 2023 LP Survey, produced in association with Private Equity Wire, 200 global investors share their market views, allocation plans and decision-making drivers for the next 12 months.
The report highlights: - Alternative fund performance vs. expectations
- Investors' plans for increasing the number of GP relationships
- Niche strategies: A main driver for emerging managers?
- Rollover investments and continuation funds
- LPs' perceptions of their GPs' transparency
Download this report today. Gain inside knowledge of your LPs' thinking and plans. | | | | | | | |
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| Taking the temp on healthtech: Deals and valuations stay resilient | |  | | (fizkes/Shutterstock) | | | In a year when everything in the VC market feels feeble, healthtech is looking relatively hale and hearty.
Healthcare-focused companies, particularly those in digital health, continue to attract investor interest at a robust pace compared to other verticals this year.
Healthtech startups have also seen their median valuation increase 33% compared to the 2021 figure, indicating that investors see recession-resilient opportunities within the vertical. | | | | | | | | | Israel's VC funds bring in more cash as European hubs struggle | |  | | Tel Aviv's financial district (eskystudio/Shutterstock) | | | Fundraising in Europe's smaller VC markets grew faster this year as the region's largest hubs, such as the UK and France, faltered.
The continued maturation of the European venture ecosystem has pushed more capital toward Israel and other less-established areas as LPs seek new opportunities. | | | | | | | | | | How the gates closed for redemptions on Blackstone's runaway real estate vehicle. [Financial Times]
Fed research shows that startups with Black founders get just a third of the VC capital raised by their peers. [Bloomberg]
Many small investors who piled into cryptocurrencies on FTX, BlockFi and other platforms are recognizing the perils of investing in an unregulated industry. [The New York Times] | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 477 Deals | 1783 People | 591 Companies | 21 Funds | | | | | | |
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| 2011 Vintage Global VC Funds | | | | | | |
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| A message from Apex Group | | |
| Our Corporate Services provide scalable solutions for back-office functions | | Apex has an experienced team in the US that provides strategic expertise for startups, tech companies, VCs, corporates, private equity funds, asset managers and SMEs.
Whether you are looking for project support, technical expertise, or to scale your team, Apex can partner with you to become an extension of your operation.
Apex provides customized solutions to meet your specific needs, which allows your team to focus on creating value.
The depth and scope of Apex's solutions include: - Accounting
- Payroll
- Tax
- Human resources support
- Employee benefits
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- Business administration
- Board support
Visit Apex's website to find out more | | | | | | | |
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| ILPA names Jennifer Choi CEO | | | Jennifer Choi has been appointed CEO of the Institutional Limited Partners Association. Choi has been the acting CEO since June, and was previously managing director of industry affairs. | | | | | |
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| Runway hits $500M valuation | | | Runway, an AI developer specializing in creative content, has raised a $50 million Series C led by Felicis Ventures. The company has annualized revenue of around $1 million and is valued at $500 million with the new round, Forbes reported. | | | | | | | Supplement specialist HealthKart picks up $135M | | | HealthKart, an Indian company that sells health supplements and accessories, has raised a $135 million Series H led by Temasek. The deal values the startup at about $350 million, TechCrunch reported. | | | | | | | | | | | | | | BeeHero flies off with $42M | | | | | | | | | | | | | | | | | Giraffe360, which creates cameras for real estate professionals to map properties, has raised $16 million in a round led by Founders Fund, according to reports. | | | | | | | Rezonate rakes in $8.7M in seed funding | | | | | | |
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| Don't miss our upcoming webinar | | The crypto market has lost some of its luster since its resurgence in 2021, with values dropping and companies and investors alike leaving the industry. But there is still ongoing VC interest, and we predict a significant amount of deployed capital in the next few years.
Join our webinar to get the perspectives of industry investors and PitchBook emerging tech senior analyst Robert Le on how this technology can move forward. Key topics include: - How this crypto bear market is different from past downturns.
- What investors are avoiding in this market and where they see opportunities.
- Viewpoints on risk management, security flaws, regulations and other crypto trends.
Register now to secure your spot. | | | | | | | |
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| Coupa shareholder wary of potential Vista Equity deal | | | Coupa Software shareholder HMI Capital Management, which owns one of the largest stakes in the company at 4.8%, has voiced opposition in a letter to Coupa's board to a possible take-private plan by Vista Equity Partners. HMI recommended that the board should look for bids over $95 per share. | | | | | | | Morgan Stanley courts buyers for its 40% PNE stake | | | | | | | | CVC Capital weighs Razer sale | | | | | | | | Antin buys broadband specialist | | | Antin Infrastructure Partners has purchased a majority stake in Florida broadband provider OpticalTel, which specializes in bulk contracts that sell internet to condominiums and homeowners' associations. OpticalTel's founder retains a stake in the company. | | | | | | | Lincolnshire acquires auto parts seller Whitewater | | | | | | | | Align picks up Premier Biotech | | | Align Capital Partners has acquired drug testing company Premier Biotech. With Align's funding, Premier plans to conduct further research and development on its tests and grow via add-on acquisitions. | | | | | |
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| Circle calls off SPAC merger | | | Blockchain specialist Circle has terminated plans to merge with blank-check company Concord Acquisition. Circle, which enables businesses to send and receive cryptocurrencies, said it was profitable in Q3 and had $400 million in cash on hand at the end of the quarter. | | | | | |
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| TPG invests in Hidden Hill's $465M fund | | | TPG subsidiary NewQuest Capital Partners has invested in Singapore-based Hidden Hill Capital's latest fund, which has raised $465 million, Bloomberg reported. The Hidden Hill Foundation Fund targets investments in services that Chinese companies could need for global expansion. | | | | | | | Solo VC Ozi Amanat raises $300M | | | K2 Global, a venture firm led by solo VC Ozi Amanat, has closed a $300 fund that will be used to invest in early-stage startups in foodtech, climate tech and AI. The Miami-based firm has invested in Paytm, Spotify and Impossible Foods. | | | | | |
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"IPOs accounted for roughly one-third of exit value in the last two years as bullish markets gave way to a flurry of private companies listing on the public market with elevated valuations.
In 2022, IPOs contributed a mere 1.6% of total market exit value as investors shied away from new issues amid market volatility, and valuations dropped with market correction."
Source: PitchBook's Q3 2022 US PE Breakdown | | | | | |
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