Payment startups hold their own

Hydrogen fuel cells back in spotlight; assessing US VC predictions for 2022; Guesty brings home $170M; TA backs wildfire science specialist
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The Daily Pitch: VC, PE and M&A
August 17, 2022
The Daily Pitch is powered by PitchBook's industry-defining research and best-in-class data
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In today's Daily Pitch, you'll find:
  • Our new market map explores the evolving landscape for fintech companies that specialize in digital payments.

  • PitchBook analysts examine emerging applications for hydrogen fuel cells in sectors like trucking, aerospace and warehousing.

  • Our analysts assess their predictions for US venture capital in 2022.
 
Today's Top Stories  
Market Map: Fintech payment startups hold their own in uncertain times
(PCH-Vector/Getty Images)
The increasing digitalization of financial services has benefited fintech startups over the last few years, with the pandemic speeding up this trend. The payments segment, in particular, has seen rapid change, leading to the rise of venture-backed startups selling corporate credit cards, payroll software and checkout services.

Explore our fintech market map to see where investors are putting their money.
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Emerging opportunities bring hydrogen fuel cells back to the stage
Hydrogen fuel cell technology, once viewed as the future of green cars, has fallen by the wayside as lithium-ion batteries have gained traction as the primary means of powering electric vehicles. While many larger corporate and state players have made substantial investments in the space, VC activity has remained limited compared with investment into battery-powered mobility solutions.

Our latest Emerging Tech Research analyst note tracks recent VC deal activity in the hydrogen EV subsegment and explores emerging applications in trucking, aerospace, warehousing and marine vessels, sectors wherein the climate-friendly fuel has the potential to outperform its gas and electric peers.
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A message from Allvue Systems  
Video: How to streamline management of combined equity and credit portfolios
Despite managing portfolios that include both private equity and private debt investments, many fund managers find their back-office workflows have been segregated by disconnected accounting systems.

In this two-minute demo, Robert Sims, Head of Solutions Engineering, Europe, shows how Allvue can change this. Allvue's credit investment accounting subledger seamlessly integrates with our private equity fund accounting general ledger, helping to streamline operations and reduce risk for diversified firms.

See how Allvue simplifies back-office workflows by giving you:
  • Operational control over complex assets
  • Customizable dashboards to easily view detailed position history
  • Automatically generated subledger entries
  • Agency support with notice generation
Watch now and see it in action
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Revisiting our 2022 US VC predictions
At the start of the year, PitchBook analysts mapped their projections for the US venture capital market in 2022. Midway through the year, trends are beginning to crystallize, and our recent analyst note updates the scorecard.

Takeaways include:
  • Roughly 1,173 corporate venture capitalists have made a deal in the US, which bodes well for our prediction of more than 1,500 for the year.

  • The 10 most active venture ecosystems are on pace to hit our projection of more than 400 deals each.

  • Macroeconomic forces have undercut our forecast of a year-over-year increase in public listings by VC-backed companies.
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Middle-market PE firms prepare for a shift
(PM Images/Getty Images)
As the private equity world begins winding down from a torrid year of dealmaking, some sponsors in the middle market have switched into "risk-off" mode.

The public markets' downturn and subsequent volatility, along with rising interest rates and the possibility of a recession, are leading middle-market sponsors to begin changing their approach to dealmaking after 2021's good times. Those factors are creating opportunities to scale platform companies through add-on acquisitions, and buy high-growth businesses held in VC portfolios at lower prices.
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Recommended Reads
The head of Maersk's venture client unit is using her perspective as a former founder to improve the experience for startups working with corporations. [Sifted]

Climate tech startups are embracing the public benefit corporation, a formerly niche way of incorporating, as a way of holding themselves accountable. [Protocol]

SPAC market fumbles have touched even the king of SPACs, Chamath Palihapitiya, as two of his blank-check companies file to push back their deadlines to make acquisitions. [Bloomberg]
 
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Quick Takes  
  The Daily Benchmark  
  2018 Vintage European VC Funds  
  VC Deals  
  Biotech startup Orna raises $221M  
  Guesty brings home $170M  
  Senda Biosciences secures $123M Series C  
  Moximed scores $40M in debt and equity  
  Modulate rakes in $30M Series A  
  Omni launches with $27M in funding  
  Talent development startup GrowthSpace picks up $25M  
  Arc banks $20M to help startups raise nondilutive funding  
  PE Deals  
  Macquarie, KKR bid for Singaporean waste collector  
  Thoma Bravo looks to take Darktrace private  
  TA to stake wildfire science specialist Technosylva  
  Crestview backs Digicomm International  
  Frontline invests in LivWell Infusions  
  TSCP's WeVideo acquires PlayPosit  
  Riverside's Convergence adds on Swat Systems  
  Portfolio Companies  
  BlackRock, Fidelity cut Ant valuation  
  Fundraising  
  TSCP secures $1.5B+  
 
 
The Daily Benchmark  
2018 Vintage European VC Funds
Median IRR
42.75%
Top Quartile IRR
51.28%
1.85x
Median TVPI
Select top performers
Forbion Capital Fund IV
HV Holtzbrinck Ventures Fund VII
Capital300 Fund
*IRR: net of fees
9 Funds in Benchmark »
Check out the latest version of PitchBook Benchmarks
 
VC Deals  
Biotech startup Orna raises $221M
Orna Therapeutics has held an initial close of a $221 million Series B, consisting of $121 million at signing and an additional $100 million subject to closing conditions. Investors included Merck, which contributed a reported $100 million and will partner on drug development with the company, which creates medicines using circular RNA.
View round
 
View similar company »
 
Guesty brings home $170M
Guesty has raised $170 million in a round co-led by Apax Digital Funds, MSD Partners and Sixth Street. The company provides property management software for short-term rental companies and hospitality operators such as Airbnb, Booking.com and Vrbo.
View round
 
View 23 competitors »
 
Senda Biosciences secures $123M Series C
Senda Biosciences has raised $123 million from investors including Flagship Pioneering, Samsung Life Science Fund and Qatar Investment Authority. Based in the Boston area, the company is a developer of protein-based therapies and drugs for infectious, genetic, metabolic and autoimmune diseases.
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Moximed scores $40M in debt and equity
Moximed has raised $40 million in debt and equity financing led by Advent Life Sciences, with support from investors including NEA and Future Fund. The Fremont, Calif.-based company's implantable shock absorber helps patients suffering from knee osteoarthritis.
View round
 
View 18 competitors »
 
Modulate rakes in $30M Series A
Modulate has raised $30 million in a round led by Lakestar. Based in the Boston area, the company is the developer of a platform intended to help online game developers reduce toxic behavior online.
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View 1 competitors »
 
Omni launches with $27M in funding
Omni has raised $26.9 million, comprising a $17.5 million Series A led by Redpoint and $9.4 million in seed funding led by First Round. The startup, which announced its launch Tuesday, is the developer of a business intelligence platform.
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Talent development startup GrowthSpace picks up $25M
GrowthSpace has raised a $25 million Series B led by Zeev Ventures, with support from M12 and Vertex Ventures. The New York-based company provides a talent development platform with group coaching, mentoring and workshops for corporate employees.
View round
 
View similar company »
 
Arc banks $20M to help startups raise nondilutive funding
Arc has raised a $20 million Series A led by Left Lane Capital. Based in the Bay Area, the company's digital banking platform helps software-driven startups access nondilutive and nondebt funding alternatives. NFX, Y Combinator and Clocktower Technology Ventures also participated in the funding.
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View similar company »
 
 
PitchBook, NVCA and Beyond the Billion join forces for a deep dive into the state of women funders and founders at next year's SXSW.

Vote for their session "Investing in Inclusion: Women Funders and Founders" in SXSW Panel Picker to make sure they take the stage in March. Voting closes Sunday, Aug. 21.
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PE Deals  
Macquarie, KKR bid for Singaporean waste collector
800 Super Waste Management's founders are close to selling the company in a deal that could value the Singaporean waste collector at around $300 million, Reuters reported. Macquarie Asset Management and KKR, which already owns a minority stake in the company, are said to be among the final bidders.
View deal
 
View similar company »
 
Thoma Bravo looks to take Darktrace private
Thoma Bravo is in early talks with UK cybersecurity firm Darktrace over a possible take-private. Thoma Bravo has until Sept. 12 to make a firm offer for the company.
View deal
 
View 51 competitors »
 
TA to stake wildfire science specialist Technosylva
TA Associates has agreed to make a growth investment in Technosylva, a provider of wildfire simulation modeling, risk analysis and operational response solutions. Founded in 1997, the company has offices in California and Spain.
View deal
 
View similar company »
 
Crestview backs Digicomm International
Crestview Partners has invested in Digicomm International. Based in Colorado, the company provides equipment and services to the broadband industry.
View deal
 
View similar company »
 
Frontline invests in LivWell Infusions
Frontline Healthcare Partners has recapitalized and invested in LivWell Infusions, a provider of outpatient infusions and injections for patients in Arizona, California, New Mexico, Indiana and Pennsylvania.
View deal
 
View similar company »
 
TSCP's WeVideo acquires PlayPosit
Thompson Street Capital Partners portfolio company WeVideo has acquired PlayPosit. The acquired company's software allows educators to add interactive elements such as embedded media, surveys and assessments to their video content.
View deal
 
View 2 competitors »
 
Riverside's Convergence adds on Swat Systems
Riverside Partners-backed Convergence Networks has acquired Seattle-based Swat Systems, which offers cybersecurity and IT services to small and medium-sized businesses.
View deal
 
View similar company »
 
 
Portfolio Companies  
BlackRock, Fidelity cut Ant valuation
Global investors who acquired private shares in Ant Group prior to its suspended IPO have again lowered the fintech giant's valuation, Bloomberg reported. BlackRock lowered the company's valuation from $174 billion to $151 billion in March. In May, T. Rowe Price shaved it down to $112 billion from $189 billion last year, while Fidelity Investments dropped its estimate to $70 billion, down from $78 billion in 2021 and $235 billion in 2020.
View details
 
View 32 competitors »
 
 
Fundraising  
TSCP secures $1.5B+
Thompson Street Capital Partners has closed its sixth PE fund on more than $1.5 billion. TSCP VI will make equity investments of up to $250 million in sectors including life sciences and healthcare, software, and business and consumer services.
View fund
 
View 195 investments »
 
 
Chart of the Day  
"As round sizes have grown larger, time periods to reach financing stages have remained relatively flat, indicating companies have attracted greater sums of capital in similar time frames to the past decade."

Source: PitchBook's Q2 2022 European VC Valuations Report
 
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