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| In today's Daily Pitch, you'll find: | | | | | |
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| Unicorn slump shows no signs of abating | |  | | (PitchBook News) | | | Billion-dollar VC-backed company formation continues to slump to historical lows, the PitchBook Unicorn Tracker shows. - Just four unicorns were minted in January for a total valuation of $6.2 billion, the fifth-lowest monthly total since 2016, according to PitchBook data.
- Information technology companies continue to lead the way in unicorn creation: Two of the four that were minted in January are in that sector. European companies comprised the majority of new unicorns for the first time since May 2016.
- Notable rounds in January included solar panel manufacturer Enpal's $228.4 million Series D at a $2.54 billion valuation, according to PitchBook data, and AI translator Deepl's reportedly more than $100 million raise at a €1 billion valuation.
| | | | | | | | | Global M&A keeps calm and carries on | | After a tremendous 2021, M&A appeared poised to keep up its frenzied pace—but while another record-breaking year wasn't in the cards, M&A activity held strong even as global markets ran off the rails. Mountains of dry powder, shifting strategies and well-capitalized strategic investors propelled deal value above pre-pandemic levels.
Our 2022 Annual Global M&A Report, sponsored by Liberty GTS, breaks down last year's trends by region and sector and explores the forces likely to shape the market in the months to come. Takeaways include: - Buyers took advantage of cheaper prices, with median deal multiples declining to 8.8x from a 14-year high of 11.1x.
- Platform companies made good use of their sponsors' cash, rocketing add-ons to more than 70% of all buyout deals.
- Cross-border investors flipped the script, with North American acquirers accounting for 21% of all European M&A value.
| | | | | | | | | Morgan Stanley's $2.5B fund keeps secondaries momentum rolling | |  | | (rblfmr/Shutterstock) | | | Morgan Stanley Investment Management has announced the close of a $2.5 billion secondaries fund, another indicator of investor interest in the secondary market. Continuation vehicles have gained traction as LPs seek liquidity.
These funds grant LPs direct exposure to more mature assets. In a shrinking exit environment with limited routes to cash out, the secondary market is an attractive alternative to more traditional paths. | | | | | | | | | Startup life expectancy predicted to fall | |  | | (ShutterOK/Shutterstock) | | | Company failure rate was extremely low during the last boom cycle. But investors expect that to change this year, in a big way.
High-profile shutdowns in the crypto sector could be a sign of things to come across the tech landscape, investors say. VCs are getting stingier with existing funds and are unlikely to support weak portfolio companies. | | | | | | | | | Credit quality declines for European leveraged loans amid ratings shift | |  | | (NicoElNino/Shutterstock) | | | The credit quality of loans in the Morningstar European Leveraged Loan Index has been declining, with lower-rated tiers taking a bigger slice. The share of B-minus rated loans reached 20% of the index in December 2022—up from just 5% in October 2017.
The ratio of downgrades to upgrades of European leveraged loans hit 4.5 to 1 in October 2022. The size of the index stood at a record €278 billion at the end of last year, but the annual growth rate of 3.45% in 2022 was down from an average of 18.7% between 2016 and 2021. | | | | | | | | | | For female founders, fundraising from female VCs can make raising additional rounds harder. [Harvard Business Review]
Is the price of Bitcoin being propped up? The academic who proved manipulation in 2017 suspects it may be happening again. [Fortune]
Someday, you might be able to eat your way out of a cold. [The Atlantic] | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 51 Deals | 248 People | 80 Companies | 9 Funds | | | | | | |
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| 2017 Vintage Global Funds-of-Funds | | | | | | |
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UK lender Zopa has raised £75 million (about $92 million) in a round led by IAG Silverstripe after postponing its IPO plans, Reuters reported.
Aviation software startup Portside has landed a $50 million Series B led by Insight Partners. Previous investor 12BF Global Ventures also participated.
Freeform, a metal 3D-printing specialist started by former SpaceX engineers, has emerged from stealth, having secured $45 million from investors including Two Sigma Ventures.
Fintech startup Treasury Prime has banked a $40 million Series C led by BAM Elevate.
Recurrency, which offers a sales and management platform for distributors, has closed a $22 million round with participation from Bessemer Venture Partners and Y Combinator Continuity.
HVAC startup Gradient has raised an $18 million Series A led by Ajax Strategies and Sustainable Future Ventures.
Marketing platform provider Constellation has closed a $15 million round led by Newlight Partners.
Lavender, which offers an AI email-marketing platform, has raised a $13.2 million Series A led by Norwest Venture Partners.
Dimension Inx has closed a $12 million round led by Prime Movers Lab. The startup designs therapeutics for the pharmaceutical industry.
Doctify, a UK-based platform for patient reviews, has raised $10 million in a round led by Beringea.
Re:course, a UK-based AI platform for healthcare training, has received $4.3 million in a seed round led by Par Equity.
Estonian EV charging startup Vool has secured €1.7 million (about $1.9 million) in a seed round led by Specialist VC.
UK climate-tech startup Greenspark has raised £1 million (about $1.2 million) in a seed round led by Fuel Ventures. | | | | | |
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| PitchBook webinar: Fueling success in the Medicare Advantage market | | Private equity firms have become leading consolidators of primary care practices focused on Medicare Advantage. However, the market is extremely competitive, so firms must enable providers to improve patient outcomes and lower costs while also partnering effectively with payers.
In our upcoming webinar, PitchBook's lead healthcare analyst, Rebecca Springer, and senior Optum strategists will explore how PE firms can evaluate opportunities, navigate risk and win in the Medicare Advantage market. Key topics include: - How payer competition and macro trends are shaping unique geographic markets.
- An actuary's perspective on financial risks and opportunities.
- A model for provider success in progressively more sophisticated value-based contracts within a typical PE investment cycle.
Register now to secure your spot. | | | | | | | |
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Clayton, Dubilier & Rice has offered to take Focus Financial Partners private at a valuation of $4.1 billion. Minority stakeholder Stone Point Capital, which owned the investment adviser alongside KKR prior to Focus' 2018 Nasdaq listing, may also get involved in the deal.
Blackstone is considering acquiring Cvent in a deal that could value the events management software company at up to $4 billion, Reuters reported.
A real estate joint venture between Credit Suisse Asset Management and Trinity Real Estate Investments has agreed to purchase the Diplomat Beach Resort, an oceanfront property in south Florida, from Brookfield Asset Management for $835 million, The Wall Street Journal reported.
Apax has invested £60 million in London-based clothing retailer Matchesfashion, Sky News reported.
KKR has offered to buy a stake in the fixed-line division of Telecom Italia. KKR made a bid to take Telecom Italia private in a €10.8 million deal in 2021.
Infrastructure investor GI Partners has acquired Rise Broadband, an internet provider that serves primarily rural communities in 16 states. Under GI, the company plans to accelerate fiber-to-the-home services.
Wellspring, an innovation and intellectual property software provider backed by Resurgens Technology Partners, has acquired IP Pragmatics, which offers consultancy and other services for technology transfer and IP management.
American Pacific Group has invested in California-based Media One Digital Imaging, which provides high-format digital printing solutions.
Littlejohn & Co. has acquired Ardurra Group, in partnership with its management team. The company offers engineering and design services for industries such as transportation, water and aviation. | | | | | |
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| Livingbridge exits Red Box | | | | | | |
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| All Seas closes first fund on $400M | | | All Seas Capital has held a $400 million final close of its maiden fund, which will target mid-market companies in Western Europe. | | | | | | | Oakley raises €2.85B for fifth flagship fund | | | Europe-focused mid-market firm Oakley Capital has reached a €2.85 billion close on its fifth flagship fund, exceeding its €2.5 billion target. The new vehicle is almost double the size of its predecessor. | | | | | | | Firebolt targets $100M fundraise | | | According to an SEC filing, Firebolt Ventures is targeting a $100 million raise for its latest fund. The venture capital firm invests in seed and early-stage startups. | | | | | |
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| One Rock plants London office | | | | | | | | DigitalBridge expands with $316M AMP Capital deal | | | DigitalBridge Group, a digital infrastructure investing firm, has acquired AMP Capital's global infrastructure investing management business for $316 million. Now branded as InfraBridge, the portfolio contains four funds with $5.6 billion in fee-earning AUM. | | | | | |
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