Sunday, March 26, 2023

Unexpected upside of SVB failure

Plus: Deep dive into generative AI, real estate's markdown problem & more
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The Weekend Pitch
March 26, 2023
Presented by Auto Angel by Stonks
(Jenna O'Malley/PitchBook News)
After a mad scramble two weeks ago to get cash to companies with deposits trapped in Silicon Valley Bank, the VC ecosystem is back to business as usual. The bridge bank that controls SVB's former assets and liabilities has not only guaranteed all deposits, but it is also honoring all lines of credit and offering new loans.

But for most people investing in venture capital throughout the last boom cycle, things don't feel quite the same.

Venture was in a precarious position even before SVB failed, but having its main bank disintegrate made the entire asset class even more vulnerable, an LP at a university endowment told me. "I think it will force a correction more quickly than it might have otherwise," the person said. As grim as that may sound, LPs see benefits in a speedier rationalization of the asset class.

This is the Weekend Pitch, and I'm Marina Temkin. You can reach me at marina.temkin@pitchbook.com or on Twitter @MTemkin.

Gloomy statistics and anecdotes abound.
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Trivia

One of our latest analyst reports covers ecommerce in Q4 2022. From payment-enablement services to post-purchase experiences, the vertical has grown to encompass many segments and has garnered a lot of investor interest. In Q4, deal count rose by 51% from the previous quarter. How many ecommerce deals did PitchBook track in Q4 2022?

A) 34
B) 89
C) 54
D) 77

Find your answer at the bottom of The Weekend Pitch!
 

The big picture on generative AI

(SomYuZu/Shutterstock)
Generative AI is seemingly everywhere these days, and the newly emerging vertical is the talk of everyone in tech and VC. But how to make sense of it all? PitchBook's new Vertical Snapshot: Generative AI has all the information you need, including a breakdown on the key players, the terms you need to know and a deep dive into potential uses for generative AI.
 

Real estate's public markdown problem

(Who is Danny/Shutterstock)
Private real estate funds have far outperformed publicly traded investment trusts over the past year. But is there really a big difference between the properties underlying public and private funds? Some folks are starting to say "no."

Our latest Global Real Estate Report details the extent of the public-private performance delta. As for what comes next, LPs are most interested in opportunistic funds. The report's extensive fundraising data shows where dollars will be deployed next in real estate.
 

Find winners with PitchBook's VC Exit Predictor

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It's a gamble picking which startups to back with your money and—most importantly—your time. PitchBook's new VC Exit Predictor just made it a whole lot easier to find winners.

Our recent analyst note Gaining an Edge in VC Investment Selection lays out how the tool utilizes machine learning and PitchBook's vast amounts of data to provide insights into a startup's prospects of a successful exit.
 

Quote/Unquote

(Funtap/Shutterstock)
"The US banking system is sound and resilient. The committee remains highly attentive to inflation risks."

—The Federal Open Market Committee, which sets interest rates, said in a statement after voting for a ninth straight increase in rates, the first since several high-profile bank closures rattled the global banking system.
 

Stay tuned

Keep an eye out for these fresh insights and research reports coming out this week!
  • Q4 2022 Retail Fintech Report
  • Q4 2022 Insurtech Report
  • Q4 2022 AI & ML Report
  • H2 2022 Greater China VC Report
 

Recommended Reads

Crypto wants its shine back. [The New York Times]

Investment fund links to Atlanta police and "Cop City" project revealed. [The Guardian]

The biggest decider of who backs a TikTok ban? If they use TikTok. [The Washington Post]
 

Trivia

Answer: D)

The correct answer is D; 77 ecommerce deals were tracked across PitchBook's platform in Q4 2022. You can read more about those deals in our Q4 2022 E-Commerce Report:

This edition of The Weekend Pitch was written by Marina Temkin, Emily Burleson and Jacob Robbins. It was edited by James Thorne and Ron Prichard.

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