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In today's Daily Pitch, you'll find: - Our analysts forecast that global private capital AUM will reach $13 trillion by 2027.
- Find out why the practice of buying stakes in private equity firms has recently gained traction.
- A look at four of last year's key trends that pushed private equity over the New Year's Day finish line.
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| Private market AUM growth will slow, but it won't die | | Persistent global market headwinds will likely blunt the growth of total private capital AUM, but they won't stop it altogether. As the alternatives industry heads into a period of uncertainty, private closed-end funds are likely in for a progressive slowdown in capital commitments.
Our aggregate model suggests that global private capital AUM will reach a total of $13 trillion by 2027, a cumulative growth of 20.7% and a steep drop from the over 200% AUM growth over the past decade. | | | | | | | | | GP stakes gain traction as fundraising slows | |  | | (YesPhotographers/Shutterstock) | | | The practice of buying stakes in private equity firms—also called general partner stakes—is gaining traction as institutional investors look at ways to gain diversified exposure to the asset class in a tough fundraising environment.
At the same time, firms are seeing GP stakes as a way of bolstering their balance sheets. | | | | | | | |
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| ESG at the expansion stage: How fast-growth companies are navigating ESG priorities | | After a record-breaking 2021 for dealmaking, ESG's primary arenas of cleantech, climate tech and impact investing saw robust tallies of investment at the expansion stage in 2022—totaling $15.7 billion across a few hundred completed deals. Yet, balancing ESG priorities with rapid growth can prove challenging. The latest edition of Deloitte's Road to Next series explores key metrics emerging from dealmaking data while discussing insights on key priorities and how ESG implementation can aid growth, with highlights including: - How factoring in risks stemming from governance ripple effects future-proofs businesses
- What growth in available capital for ESG-related enterprises entails, especially in environments of rising risk
- A spotlight on under-discussed segments of cleantech
Read it now | | | | | | | |
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| Four charts that spotlight how PE held on in 2022 | |  | | (Paolo Cremonesi/Shutterstock) | | | | 2022 wasn't a banner year for PE, but several metrics—deal value and exit count, for example—showed it was roughly in line with recent years. The industry stumbled over the New Year's Day finish line thanks to shifts in strategy that led to smaller median deal size and different kinds of investments. | | | | | | | | | Highland Europe closes milestone VC mega-fund on $1B+ | |  | Highland Europe counts food brand Huel among its portfolio.
(GarethWilley/Shutterstock) | | | Highland Europe, a UK-based venture capital firm, has hit a €1 billion (about $1.09 billion) final close on its latest growth fund—Europe's first VC mega-fund to close this year.
European VC fundraising has become more challenging, but the proliferation of larger funds has helped push the total capital raised higher as LPs gravitate toward more established managers. | | | | | | | | | | The growing success of chips using Arm technology is heaping pressure on Intel as SoftBank-owned Arm prepares for an IPO. [The Wall Street Journal]
Even as company cafeterias struggle with emptier workplaces, food is still important to employees. Here's how some businesses are reinventing the company meal. [The New York Times]
How women on boards navigate the line between warmth and competence. [Harvard Business Review] | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 456 Deals | 1784 People | 528 Companies | 21 Funds | | | | | | |
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| 2010 Vintage Global Secondaries Funds | | | | | | |
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| | | | | | | | Dayforward lands $25M, acquires Commercial Travelers | | | | | | | | Mexico's Zenfi picks up $8.5M | | | Magma Partners has led an $8.5 million round for Mexico-based Zenfi, TechCrunch reported. The company's platform helps users understand their finances and taxes. | | | | | | | Calimero Network raises $8.5M | | | | | | | | Former FTX US head scores $5M for crypto startup Architect | | | | | | | | Grazzy gets $4.25M for digital tipping | | | Grazzy, which offers a payments platform for hourly workers, has raised a $4.25 million seed round. Next Coast Ventures and Tuesday Capital participated in the round. The Austin-based startup has raised a total of $6.8 million. | | | | | |
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| Insights on over 100K clinical trials now available in PitchBook | | In response to market volatility and slowing innovation in the computer hardware and software space, investors are turning to healthcare—specifically, non-cyclical industries like biotech and pharma—as the next wave of high-impact, high-return opportunities. However, biotech and pharma investing contain a different set of risk profiles compared to tech startups. Progress through clinical trial stages is the best indication of the ultimate commercial viability of a new drug or medical device—and therefore, the likelihood of achieving a solid investment return.
To help investors isolate biotech and pharma companies with the highest chance of success, we've launched a new clinical trial integration, providing insights on over 100,000 clinical trials alongside our industry-leading funding data. With this new tool, investors can reduce time spent on opportunity discovery and due diligence by viewing a company's funding status alongside its drug development pipeline.
Explore our new clinical trial integration. | | | | | | | |
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| Ardian to acquire Assist Digital | | | Ardian is to acquire a roughly 60% stake in customer relationship management specialist Assist Digital. The company has offices in Italy, France, Germany, the UK, Spain and the Netherlands. | | | | | |
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| Quordle purchased by Merriam-Webster | | | Wordle competitor Quordle, which offers an online game that features four words to be guessed at once, has been acquired by dictionary giant Merriam-Webster for an undisclosed amount. The New York Times purchased Wordle in January 2022 for at least $1 million. | | | | | |
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| SLR Capital raises $2.2B for private credit strategy | | | SLR Capital Partners, which primarily invests in US-based middle-market companies, has raised $2.2 billion in equity commitments to its direct cash flow lending and specialty finance strategies. | | | | | | | Sterling closes Fund IV on $934M | | | | | | |
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| Goldman Sachs to begin offloading alternative investments | | | Goldman Sachs Asset Management plans to divest much of its $59 billion in alternative investments in an effort to boost earnings, Reuters reported. Of that number, $15 billion is allocated to equity investments. The firm's revenue from the asset class dropped 93% in 2022, according to the report. | | | | | | | Qatar Investment Authority doubles Credit Suisse stake | | | | | | | | Activist-minded Elliott invests billions in Salesforce | | | Activist investor hedge fund Elliott Management has amassed a multibillion-dollar stake in Salesforce, The Wall Street Journal reported. While it's unclear what Elliott hopes to change at the software company, Salesforce has recently announced layoffs and intentions to cut back on its office spaces. | | | | | |
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| Xylem to acquire Evoqua in $7.5B merger of water giants | | | Water technology specialist Xylem has agreed to acquire Evoqua, which provides water treatment, in an all-stock deal valued at roughly $7.5 billion, or $52.89 per share. That represents a premium of 29% based on the companies' closing stock prices Friday. | | | | | |
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"It is likely that banks will gradually return to underwriting new LBO loans late in 2023 as the backlog clears and the leveraged loan market becomes more liquid—but not before ceding significant share to direct lenders."
Source: PitchBook's 2022 Annual US PE Breakdown | | | | | |
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