Can AI stand up to Saas?

Investors dine and dash on foodtech; mid-market gains upper hand in PE; could France become Europe's biggest PE market?

Read online | Don't want to receive these emails? Manage your subscription. Log in The Daily Pitch: VC, PE and M&A March 18, 2024 The Daily Pitch is powered by PitchBook's industry-defining research and best-in-class data In today's Daily Pitch, you'll find: Our quantitative analysts explore the dynamic between two verticals: SaaS and AI and machine learning Middle-market PE fundraising finished the year with the upper hand Annual VC investment in foodtech fell by more than half for the second year in a row Could France take over as Europe's biggest PE market?   Today's Top Stories   AI in the fast lane: Momentum with moderation SaaS has been a cornerstone of digital development for over a decade, while AI and machine learning emerged as a disruptive force of innovation, driving a shift in VC investments. In 2023, AI and machine learning's share of total VC investment surged by approximately 13 percentage points, signaling heightened investor interest in this transformative technology. Our Q1 2024 Quantitative Perspectives report explores the dynamic of SaaS and AI and machine learning in the face of an ever-changing venture market as we compare the challenges, opportunities and investment prospects of these two verticals. read it now   Share: Investors dine and dash on foodtech Rising food costs and inflation have led to a difficult environment for foodtech: This was the second year in a row that annual VC investment in foodtech fell by more than half. Q4 2023 saw $1.7 billion in deal value generated across 279 deals, declines of 39.8% and 9.7%, respectively. There are still reasons to be optimistic about the vertical, writes senior analyst Alex Frederick. From startups operating within the plant-based proteins space to a resurgence in the food ecommerce segment, our Q4 2023 Foodtech Report serves up the trends, key players, and data sure to make investors full. read the preview   Share:   A message from RBC Capital Markets   Will the rush for new tech trigger retail M&A? Robust economic indicators and a more resilient consumer are laying the groundwork for positive growth outcomes in the retail sector. To flourish in this fiercely competitive landscape, retailers must demonstrate adaptability — enhancing customer experiences while effectively managing costs. Companies actively pursuing new capabilities will likely trigger a new wave of consolidation supported by financial sponsors looking to put pent up capital to work. Tune in to RBC's Strategic Alternatives podcast, to hear expert bankers discuss how the surge in new technology is driving the next wave of retail M&A. Share:   Mid-market gains upper hand in PE fundraising race (Digital Vision/Getty Images) PE funds targeting the middle market amassed roughly $141 billion in 2023—the second-highest annual tally on record. These vehicles' ability to return more capital to investors than mega-funds helped them gain the upper hand in the fundraising race. read more   Share: Paris looks to make itself more attractive to PE (AlxeyPnferov/Getty Images) Could France take over as Europe's biggest PE market? France is hoping to woo private equity with a new law that lowers barriers to doing business in the country, possibly drawing further financial services away from London. read more   Share: How will AI propel infrastructure SaaS? Startups in the infrastructure SaaS market are ready to capitalize on the sea change that AI is bringing. The sector saw an uptick in VC funding in Q4 2023—reaching $2.2 billion compared to Q3's $1.9 billion. There is still plenty of room for growth, especially for companies focusing on data software and systems, according to our recent Emerging Tech Research. Senior analyst Derek Hernandez examines startups supporting AI and other key trends in the infrastructure SaaS space. read the preview   Share: Q&A: Mid-market lender expects distressed debt opportunity to rise (Eoneren/Getty Images) A growing batch of troubled corporate borrowers need to restructure their liabilities, creating opportunities for investors that specialize in distressed debt. Charlesbank Capital Partners closed its third credit opportunities fund on $1.5 billion in January. The PE firm's head of credit, Sandor Hau, anticipates that the distressed debt market will be particularly active in the short term. read more   Share:   Since yesterday, the PitchBook Platform added: 5 Deals 23 People 26 Companies See what our data software can do   The Daily Benchmark: 2017 Vintage Non-US PE Funds Median IRR 22.21% Top Quartile IRR 26.75% 0.60x Median DPI Select top performers Summit Partners Europe Growth Equity Fund II HgCapital Mercury 2 HgCapital Genesis 8 *IRR: net of fees 35 Funds in Benchmark » Check out the latest version of PitchBook Benchmarks   VC Deals   Crypto startup Berachain raised $69 million in a round led by Brevan Howard Digital and Framework Ventures, Bloomberg reported. Swedish biotech startup Asgard Therapeutics raised a €30 million Series A led by RV Invest and Johnson & Johnson Innovation. DraftWise, a legal AI startup based in New York, raised a $20 million Series led by Index Ventures. Thirdverse, a VR game development startup, secured roughly $11.29 million in its Series D. Web3 game studio Metacene, which is based in Singapore, raised $10 million in a round led by Folius Ventures and SevenX Ventures. Abu Dhabi sovereign wealth fund ADIA is considering an investment in India's Pocket FM, which offers an audio streaming platform, TechCrunch reported. French cloud gaming startup Gamestream raised €4.5 million from investors including Bpifrance.   PE Deals   Advent International, Hellman & Friedman and Thoma Bravo are all considering making bids for the $3 billion software integrity business of Synopsys, Bloomberg reported. Permira is considering a take-private of Paris-listed cybersecurity group Exclusive Networks, Reuters reported. Platinum Equity has hired Goldman Sachs to explore a $2 billion sale of golf cart-maker Club Car. A consortium of investors led by Sixth Street has completed its acquisition of home improvement lending company GreenSky. The US arm of accounting firm Grant Thornton is selling a majority stake to New Mountain Capital, the Financial Times reported. Charlotte-based GemSpring Capital has sold Insurvia to an affiliate of Bharcap Partners. The Las-Vegas based insurance holdings company runs operations through Fiesta Insurance and La Familia to meet the increasing demand from the Hispanic market.   Exits & IPOs   Swiss buyout firm Partners Group is considering a $5 billion sale of a portion of its infrastructure assets, Bloomberg reported. KPS Capital Partners agreed to sell IKG, a metal grating manufacturer, to Meiser International and Dubai Transport Company. Apple has reportedly acquired Canadian AI startup DarwinAI for an undisclosed sum. Neither company has confirmed the news.   Fundraising   Dutch early-stage investor DeepTechXL has closed its debut fund on €110 million.   Chart of the Day   Source: Q2 2023 Global Fund Performance Report (with preliminary Q3 2023 data)   Who's in the newsletter today? Investors ADIA Advent International Apple Bharcap Partners Bpifrance Brevan Howard Digital DeepTechXL Dubai Transport Company Folius Ventures Framework Ventures GemSpring Capital Hellman & Friedman Index Ventures Johnson & Johnson Innovation KPS Capital Partners Meiser International New Mountain Capital Partners Group Permira Platinum Equity RV Invest SevenX Ventures Sixth Street Thoma Bravo Service Providers Goldman Sachs Companies Asgard Therapeutics Berachain Club Car DarwinAI DraftWise Exclusive Networks Fiesta Insurance Gamestream Grant Thornton GreenSky IKG Metacene Pocket FM Synopsys Thirdverse     About PitchBook | Terms of use | Advertise with us | Contact Follow us: This email was sent to edwardlorilla1986.paxforex@blogger.com via the PitchBook Platform. Do you want to change your email address, get a different edition or unsubscribe? Manage your subscription here. PitchBook Data Inc., 901 Fifth Avenue, Suite 1200, Seattle WA 98164, United States © 2024 PitchBook. 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