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| In today's Daily Pitch, you'll find: | | | | | |
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| Global fundraising data shows LPs' shifting appetite | | Private capital fundraising has been declining since Q4 2021, a trend that started accelerating at the end of last year, our latest Global Private Market Fundraising Report shows.
An arrested exit environment may be hindering LPs' ability to fund new investments from distributions of existing funds, but GPs are also easing demand for cash by ratcheting back on capital calls.
Despite the decline, allocators continue to make commitments because a down market has historically resulted in the best-performing funds. So far this year, private debt funds have made gains relative to other strategies, while VC and real assets have fallen from favor. | | | | | | | | | Decoding the blockbuster Arm IPO | |  | | SoftBank CEO Masayoshi Son has said Arm will benefit from the AI wave. (KAZUHIRO NOGI/Getty Images) | | | After months of speculation, SoftBank-backed chip designer Arm has filed to go public on the Nasdaq. Amid a volatile exit market, the listing stands to deliver SoftBank a long-awaited win.
SoftBank is the sole seller in the IPO and will remain in control of Arm after the offering. The IPO documents also revealed that Arm, whose chips are widely used in consumer devices, has yet to benefit from the AI frenzy. | | | | | | | |
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| A message from McDermott Will & Emery | | |
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Register today using code HPEPITCHBOOK200 for £200 off registration. | | | | | | | |
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| B Capital's M&A adviser expects startup-to-startup M&A to heat up | |  | Ronan Kennedy
(Chloe Ladwig/PitchBook News) | | | Acquisitions of VC-backed companies have been low, but Ronan Kennedy, who leads VC firm B Capital's internal M&A group, says that many startups are holding out until they have full-year financials for 2023 to kick off their sales processes.
Kennedy expects startup-to-startup M&A to take off as companies look to consolidate into larger platforms, but there are a couple of major roadblocks to these deals. | | | | | | | | | Robust fundraising opportunities for healthcare specialist GPs | | PE and VC healthcare specialist GPs are defying a difficult fundraising environment. From 2020 to 2021, PE healthcare specialist fundraising for North American and European managers increased 92.4%. Meanwhile, VC life-sciences fundraising increased 108.1%, and VC non-life-sciences healthcare fundraising rose 32.4%.
What's more, allocations for PE healthcare specialists and VC non-life-sciences healthcare specialists have remained elevated since 2021. By contrast, VC life-sciences managers' fundraising has normalized.
Historical outperformance by PE healthcare specialists may have contributed to fundraising success, while the track record of VC healthcare specialists has been mixed. Our Healthcare Funds Report compiles the H1 2023 fundraising status of 450 healthcare and life-sciences specialist managers by strategic style. | | | | | | | | | Partly sunny skies for private investing in Q3 | | Mixed signals abound: Most indicators show the economy on firmer footing, but our model finds it's still likely the US will enter a recession by 2025. Venture capital funds produce some of the strongest quarterly returns, but their performance is also the most volatile, and the ecosystem is struggling with unfavorable exit conditions.
With 50-plus pages of charts, our Q3 2023 Quantitative Perspectives: US Market Insights peers into PE, VC, real estate, real assets and debt through a macroeconomic lens. | | | | | | | | | | The search for winners in the new battery era. [Financial Times]
Venture capitalist Robert Nelsen has invested hundreds of millions in biotech company Altos Labs in hopes of rewriting the science of aging. [The Wall Street Journal]
Why fundraising challenges and higher interest rates have sent managers rushing to the business of net asset value loans. [Institutional Investor] | | | | | |
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| | Since yesterday, the PitchBook Platform added: | | 380 Deals | 2374 People | 682 Companies | 30 Funds | | | | | | |
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The Daily Benchmark:
2014 Vintage Global Real Estate Funds | | | | | | |
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Space technology startup Axiom Space has raised a $350 million Series C led by Aljazira Capital and Boryung, a South Korean healthcare company.
AI-powered clinical biotech company Genesis Therapeutics has raised a $200 million Series B co-led by an unnamed life sciences-focused investor and Andreessen Horowitz.
UK-based Enough has raised €40 million in a round led by World Fund and CPT Capital. The startup ferments fungi to produce protein for plant-based products.
Ghost, a B2B marketplace for surplus goods, has raised a $30 million Series B led by Cathay Innovation.
Qualifyze, a Frankfurt-based pharmaceutical supply chain compliance startup, has secured $12 million from investors including HV Capital, HarbourVest Partners and H14.
Zanifu, a Kenyan inventory financing platform, has closed an $11.2 million pre-Series A led by Beyond Capital Ventures and Variant Investments, TechCrunch reported.
FlashIntel, a SaaS sales company, has raised $10 million in seed funding, TechCrunch reported.
AI workflow automation startup Arkifi has raised over $9 million in seed funding led by Khosla Ventures and Nyca Partners.
UK-based property data and analytics startup Kamma has raised £3.6 million in a round led by Clean Growth Fund.
Lykon, a Berlin-based provider of personalized nutrition programs, has secured €2.5 million in a round led by Zintinus. | | | | | |
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| PitchBook webinar: Why allocators should rethink manager benchmarking | | Allocators employing traditional, quartile-based benchmarking methodologies to screen private fund managers face challenges in capturing historical performance. These techniques not only fail to capture the range of performance within each quartile, but also fail to offer a simple way to aggregate performance across multiple funds within the same strategy and compare that performance against similar strategies.
In this webinar, analysts from our Quantitative Research team will discuss a new framework for analyzing manager performance and unpack its implications for the due diligence process.
Register now to secure your spot. | | | | | | | |
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The DeLuca and Buck families who own Subway are close to selling the chain of sandwich shops to Roark Capital for $9.8 billion, The Wall Street Journal reported. Other bidders include TDR Capital and Sycamore Partners.
US-listed materials and chemicals company DuPont is discussing the sale of its Delrin Resins division to The Jordan Company for around $1.8 billion, Bloomberg reported.
RRJ Capital has invested $300 million in Malaysia-based Yinson Holdings' offshore oil vessel called Agogo, which was acquired in February from Azule Energy for an estimated $5.3 billion. | | | | | |
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Blackstone Tactical Opportunities Fund IV has closed on $5.2 billion. Blackstone is expecting to secure several billion more in commitments to single-investor vehicles devoted to the strategy.
Allianz Global Investors is looking to raise at least €1.5 billion for a global private credit fund, Reuters reported.
Private credit fund Algoma Capital has launched with $100 million to lend to whiskey brands and distilleries. | | | | | |
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| Permian Resources has agreed to acquire Earthstone Energy in a $4.5 billion all-stock deal. Both companies focus on exploration and production of oil and gas in the Permian Basin. | | | | | |
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"VC life sciences managers returned superior IRRs relative to the broader VC industry in two of three vintage buckets but posted considerably lower TVPIs across the board. This may be due to the capital-intensive nature of drug development. Meanwhile, VC healthcare specialists that do not focus on life sciences severely underperformed using IRR and moderately underperformed using TVPI. However, it is important to note that data counts for this analysis are low, particularly for the 'VC other healthcare' category."
Source: PitchBook's H1 2023 Healthcare Funds Report | | | | | |
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