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As venture capital firms continue to flood the crypto and digital asset space with more money, a stampede of unicorns is emerging unlike anything the space has ever witnessed.
According to Crunchbase data, 18 unicorns—companies with a valuation of $1 billion or more—have been newly minted this calendar year. That’s about two-thirds of the total amount of unicorns in the crypto space in total. READ MORE
Private-equity firms continue to face a problem most people wish they had — they have more money than they know what to do with.
The top 25 private-equity firms are sitting on $509.8 billion in uninvested cash, according to data released Tuesday by S&P Global Market Intelligence and Preqin. READ MORE
The Securities and Exchange Commission alleged that a Georgia man and a firm he controlled ran a more than decade-long Ponzi scheme that raised more than $110m from investors.
Responding to an emergency SEC request, the US District Court for the Northern District of Georgia in Atlanta on Tuesday froze the assets of the alleged head of the scheme, Georgia resident John J Woods, and Horizon Private Equity III, the Atlanta-based fund that the SEC alleges he used to perpetrate the scheme. The court also issued a temporary restraining order against both Woods and Horizon. READ MORE
As a chief business development officer for an international software development agency, I communicate with startups from all over the world. Consulting and helping to make everything possible for the most innovative idea to hit the market is part of my daily work. I am lucky to see how ideas result in amazing products through monitoring new startups. Unfortunately, not every new digital idea is warmly welcomed by today’s users. It is common to encounter errors that result in failure and financial loss despite significant investments. READ MORE
Venture funding is not for the faint of heart, or for those in a hurry for return. Forbes says 90 percent of startups are bound for failure; venture firms aim to throw many seeds on fertile ground in hopes a few will take off and become the “unicorn” companies valued at $1 billion or more a decade or more into the future. Experts recommend only risking a small portion of your investment portfolio on startup funds. READ MORE
Cone Health, a small not-for-profit health care network in North Carolina, spent several years developing a smartphone-based system called Wellsmith to help people manage their diabetes. But after investing $12 million, the network disclosed last year it was shutting down the company even though initial results were promising, with users losing weight and recording lower blood sugar levels. READ MORE
Female-founded companies are raising venture capital at significantly higher levels than at any point in the last decade, suggesting that long-standing efforts to boost representation in entrepreneurship are paying off at an accelerating rate. READ MORE
At one point, traditional private equity funds made up a huge fraction of large shops’ assets under management. But as time goes on, many large firms that are traditionally thought of as PE-focused have expanded and diversified, designing a variety of new pools of capital with different strategies to appeal to the preferences of various limited partners. READ MORE
The $800 million of private backing secured by Californian residential solar finance business GoodLeap helped the sector achieve VC and private equity funding of $1.6 billion in the first six months of the year, up from just $210 million a year earlier. READ MORE
The pandemic completely upended the threat landscape as we know it. Ransomware accounted for an estimated 2.9 million attacks so far in 2021, and supply-chain attacks that targeted Kaseya and SolarWinds have increased fourfold over 2020, according to the European Union’s cybersecurity agency, ENISA, which recently warned that the more traditional cybersecurity protections are no longer effective in defending against these types of attacks. READ MORE
Kleiner Perkins—the venture firm once celebrated for early stakes in Amazon, Google and Genentech—has a long way to go in its quest to claw its way back to the top of Silicon Valley investors. But recent, previously unreported data on the performance of its funds from the past nine years show there are also some bright spots for the firm. READ MORE
Inflation may or may not prove transitory when it comes to consumer prices, but startup valuations are definitely rising — and noticeably so — in recent quarters.
That’s the obvious takeaway from a recent PitchBook report digging into valuation data from a host of startup funding events in the United States. While the data covers the U.S. startup market, the general trends included are likely global, given that the same venture rush that has pushed record capital into startups in the U.S. is also occurring in markets like India, Latin America, Europe and Africa. READ MORE
Exclusivity means limitations. Rarely a desirable quality, exclusivity in the financial world is a step away from the aim of an inclusive financial system. One facet of a global business that lacks ease of access is the space of venture capital. It is now a setup limited to the ultra-rich and institutions with voluminous financial backing. READ MORE
I’m frequently asked by journalists whether I think venture capital valuations are too high in the current environment.
Because the average venture capital fund returns only 1.3x committed capital over the course of a decade, according to the last reported data from Cambridge Associates, and 1.5x, according to PitchBook, I believe the answer is a resounding “yes.” READ MORE
The continuing popularity of special purpose acquisition company (SPAC) mergers is giving private company executives an attractive exit option. But whether going public using that fast-track approach is better than a traditional private equity (PE) buyout depends on what you want after the exit, specialists told CFO Dive. READ MORE
A few years back, I wrote an article titled, “700 Million Reasons to Question Everything Venture Capitalists Do.” Why 700 million? Because that was DoorDash’s “disappointing” valuation at the time. It was seen as an indication that VCs might finally be coming to their senses after a year of seemingly round-the-clock unicorn production — 10 a month — that ended with a $9 billion bang: the Theranos blood-testing debacle. READ MORE
SPAC enthusiasm is slowing, as evidenced by rising redemption rates.
Between the lines: "Redemption rates are very much a barometer of market sentiment," explains SPAC Research founder Ben Kwasnick. Higher redemption rates mean that investors are skeptical of the market and the deals — choosing to pull their money instead of risking losses if the stock price dives. READ MORE
In the same week that Afghanistan's capital, Kabul, fell into the hands of Taliban militants, ushering in a new era of regional instability, two major deals in the defense sector also hit the headlines.
On Monday, Advent International-owned British aerospace company Cobham agreed to buy Ultra Electronics, a major UK supplier of sonar equipment to the Royal Navy, for nearly £2.6 billion (about $3.5 billion). A day later came news that TransDigm—a US-based aerospace company that counts The Vanguard Group among its investors—is seeking to acquire UK aerospace defense specialist Meggitt. READ MORE
The frenzy for blank-cheque companies may be cooling, but private equity is working hard to stoke one corner of the market.
Private equity firms are turning to these vehicles, known as special purpose acquisition companies, or Spacs, to speedily cash out their investments. At the same time, buyout groups including Apollo Global Management, Ares Management and KKR have launched Spacs of their own. READ MORE