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When Sequoia Capital announced late last month it was changing its fund structure, some viewed the shift as revolutionary—with even the firm itself calling the old VC model of 10-year funds “obsolete.”
However, while the change in the tried-and-true method of doing business in the venture world is noteworthy, it also in many ways seems like just the next logical step in the continued growth of an asset class that has become increasingly large and institutionalized. READ MORE
Market fundamentals at this time mean it is a seller’s market, with traditional private equity exit routes – flotation, sale to trade or another financial buyer – all open. READ MORE
Private equity funds are a major contributor in the rapid growth of the private credit market, according to global law firm Dechert. READ MORE
Private equity dealmakers are descending on Berlin for their annual get-together, with their industry thriving and many of them wondering how long the good times will last.
Armed with billions of dollars, buyout firms have already taken advantage of what has been a record year for mergers and acquisitions (M&A), selling some of their assets for top dollar. READ MORE
After an unpredictable and turbulent start, the turn of the decade marks the private equity (PE) industry’s coming of age. Despite initial volatility, McKinsey’s annual review found that fundraising activity across private markets reached an all-time high of $7.3 trillion in 2020, of which PE accounted for 61% and was the biggest driver of this growth. Zeroing in on the U.S., PitchBook’s analysis indicated that PE deals and exits are on pace for a record-setting year in 2021. READ MORE
The US investment industry’s top regulator has called for sweeping reforms of the rapidly growing $4.2tn private equity industry, proposing rules to ensure clearer disclosures of funds’ expenses and their performance metrics.
Gary Gensler, chair of the Securities and Exchange Commission, said he wanted to simplify and standardize the disclosure of fees, which have become increasingly complex as private equity firms introduce new layers of charges for consulting and handling their portfolio companies’ capital markets transactions. READ MORE
Venture capital investment is a major economic driver in some U.S. states. In others, it plays a much smaller role.
To get a sense of how states compare, we took a look at per capita venture funding across 26 states that receive $700 million or more in annual venture funding. READ MORE
Under Securities and Exchange Commission rules, a special purpose acquisition company (SPAC) cannot identify a target at the time of the IPO. As an inducement to IPO investors to park their cash in the trust account while the SPAC searches for a target, SPACs grant investors the right to redeem their initial investment. READ MORE
In Part I of this series, readers met Geoff Chapin, the founder of C-Combinator, a climate-tech startup that removes rotting, methane-emitting seaweed from Caribbean beaches and turns it into sustainable products. Chapin considered funding his company through traditional venture capital, but ultimately took other routes.
“Mostly, we’ve done convertible notes from family offices and angel investors, doing checks between $50,000 and $250,000,” Chapin told me. “We’ve raised almost $4 million in that way.” READ MORE
NVCA President and CEO Bobby Franklin says threatening American made innovation is the wrong way to address Big Tech. The newly introduced Platform Competition and Opportunity Act from Senators Amy Klobuchar (D-MN) and Tom Cotton (R-AK) would bar acquisitions of many venture-backed companies and therefore be a major disincentive to entrepreneurship. READ MORE
Here's a move from the venture capital playbook that tends to punch entrepreneurs in the gut:
Investors give your startup a bunch of money to scale, they expect you to hire seasoned people for critical roles, then they start asking why your burn rate is so high. READ MORE
Private equity firms are playing a larger role than ever in merger and acquisition deals, according to a report by Ernest & Young.
Private equity activity now represents 30 percent of the M&A market, surpassing the prior peak of 25 percent in 2006, according to the report, which is expected to be released Friday. Throughout the first three quarters of 2021, private equity firms were involved in $868 billion worth of acquisition deals globally, “putting the industry well within striking distance for its first trillion-dollar year on record,” EY said. READ MORE
With the “Great Resignation” still very much in the headlines and job openings being plentiful to anyone on LinkedIn, money is pouring into human resource tech like never before—with just the past two months alone proving unprecedented.
While we’ve touched on this recently at Crunchbase, funding in the sector has more than doubled since mid-July. Total venture dollars now stand at nearly $7.5 billion for the year—more than the totals for 2019 and 2020 combined. READ MORE
It will be a busy night of SPAC IPO pricings as 11 are expected to price. Given the current, renewed pacing of IPOs (6 today!) and the outstanding supply, the market better get ready for a higher rate of liquidations and bad deals to come. We've said it before, but there simply is no reason -- other than for sponsors, banks, lawyers making money -- for the market to continue to pump out new SPACs. READ MORE
As we enter the final quarter of a blockbuster funding year, the record pace of global venture capital funding continues.
More than $54 billion was invested in over 2,000 companies around the world in October. That marks the fourth-highest funding month in 2021, with year-over-year growth of 84 percent in October. READ MORE
“Venture capital funding breaks records—and fuels bubble concerns.” Headlines like these abound these days. When reading the tech press, you would think that entrepreneurs are drowning in capital. But while this may be true in some sectors, the reality for the vast majority of founders throughout America is very different. READ MORE
There are now over 850 unicorn companies, according to research firm CB Insights. Some will become dragons. Some will go public or be acquired for massive sums. But some will be resigned to remembering these as the glory days.
Driving the news: MBM Capital has launched as a buyout firm focused exclusively on faded unicorns whose venture capitalists have thrown in the towel. READ MORE
With competition for venture deals heating up, one area of the market appears to have been left behind: once-promising portfolio companies that have lost their venture capital or corporate sponsors.
Enter MBM Capital, a new venture firm launched on Monday by Lauren Bonner and Arun Mittal. The firm plans to invest in orphaned venture portfolio companies that are attractive turnaround strategy investments, despite the loss of their prior backing. READ MORE
Private equity dealmaking is “smashing records” in 2021. And venture capital investments are surging. What comes next? Even more work for deal lawyers, both in the near and long term. Private equity firms continue to boast increasingly high levels of unspent capital. In addition, we are seeing an abundance of newly launched funds. These trends, taken together, will further propel the private equity cycle and bring more waves of deals in 2022 and beyond. READ MORE
Among the world’s largest nations, the U.S. has by far the highest rate of startup investment relative to population. Over the past year, venture investors put nearly $270 billion to work—averaging out to around $800 for every person in the country.
But among all countries, the U.S. ranks fourth in per capita startup investment. The No. 1 and No. 2 slots go to Singapore and Israel, two smaller countries that punch well above their weight class for tech-driven entrepreneurship. READ MORE