VNTR Capital News August 27, 2023 – News, Events, VC Reads
Venture Capital, Web3, and Private Equity – August 27 News, Events, and VC Reads
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Happy Sunday!
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VNTR CAPITAL COMMUNITY NEWS
Spotlight
We are hiring:
Sponsorships Sales Manager in Portugal or remote to secure sponsorships & strategic partnerships. Apply here
Chapter Director in Riyadh to help us launch and grow the VNTR Capital community in Saudi Arabia and serve as a gateway for the Venture Capital global community. Apply here
VNTR 1-on-1 Speed Networking Event — Grow your co-investors network at the VNTR Investors Speed Networking event on Sep 6 with VNTR members, where you can build valuable new connections. To participate, apply on the VNTR Platform.
Peer-to-Peer Support — The VNTR Platform now offers a space for our members to seek assistance and receive support from VNTR peers. Submit a request, and fellow VNTR peers will promptly provide their insights and responses to assist you.
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This week
New partnership — We partnered with Stellar Foundation and Stellar Fund.
Bali — VNTR Bali Chapter hosted our first event on Aug 25 and connected local and visiting investors at Coinfest Asia (view photos).
Upcoming
London — We are hosting VNTR Investors Dinner on Aug 29 to bring VNTR London chapter investors to meet with visiting VNTR PRO members Victor Baron and Joachim Rittfeldt Hofvenschiöld.
Seoul — We are returning to Seoul to host the first VNTR Investors Roundtable on September 6th to kickstart VNTR Chapter Seoul events during Korea Blockchain Week.
Singapore — Our flagship event in South East Asia is on Sep 14 in Singapore (official side event to Token2049, 10% Off with VNTRCAPITAL) and will feature a keynote speaker and 4 presenting partner companies. One slot is still available; apply to present.
Zug — The first Venture Capital Investors Roundtable in Zug is on Sep 15 during Crypto Valley and Crypto Oasis Swiss Web3 Festival.
San Francisco — Our second Investors Roundtable in Silicon Valley will take place on Sep 20 during TechCrunch Disrupt 2023.
Munich — The first VNTR Investors Roundtable in Munich will take place on Sep 25 as a side event to Bitz & Pretzels and Octoberfest 2023.
Thank you to our Partners:
Stellar is a decentralized, fast, scalable, and uniquely sustainable network for financial products and services. It is both a cross-currency transaction system and a platform for digital asset issuance, designed to connect the world’s financial infrastructure. Financial institutions worldwide issue assets and settle payments on the Stellar network, which has grown to over 7 million accounts. The Stellar Development Foundation (SDF) is a non-profit organization that supports the development and growth of Stellar, an open-source network that connects the world’s financial infrastructure. Founded in 2014, the Foundation helps maintain Stellar’s codebase, supports the technical and business communities building on the network, and serves as a voice to regulators and institutions. The Foundation seeks to create equitable access to the global financial system, using the Stellar network to unlock the world’s economic potential through blockchain technology.
Crypto Hunters is a new futuristic reality adventure TV show and immersive mobile game utilizing augmented reality (AR), with the primary objective of promoting widespread adoption and educating the general public about Crypto, Blockchain, NFTs, and Web3. The show aims to engage large audiences globally and increase their understanding of these concepts through captivating challenges and rewards. Currently, Crypto Hunters is in the process of recruiting 16 candidates (8 teams of 2) who will compete across 8 episodes for a chance to win the grand prize of $1 million. The show intends to reach a staggering audience of 500 million viewers, granting them the opportunity to participate in the immersive AR game associated with Crypto Hunters. Viewers can compete for rewards and cash prizes by engaging in various challenges and games. This synergistic relationship between the show and the game will create an extensive ecosystem and a vibrant community of Crypto Hunters token (CRH) holders. The tokens will serve as a means for community members to partake in games, purchase NFTs, merchandise, and more. With its multi-season format, the show plans to propel the adoption of cryptocurrencies further and foster one of the largest crypto communities globally. You can contact HK to learn more.
EHP is the only three-phase heat transfer technology that contains nanoparticles and a miraculous way to reduce energy consumption. EHP Technology (watch video) is the world's first and only known 5th-generation heat transfer technology, the world's fastest, most affordable, and most efficient heat transfer technology. EHP is the first recycling technology that can reduce up to 70% of our world's global waste heat to go to the air, saving up to 40% of the world's global energy problem. You can contact Anil to learn more.
Upcoming VNTR Capital events:
Sep 6 VNTR Speed Networking (Online)
Oct 5 VNTR Investors Roundtable London (During Sifted Summit)
Oct 8 VNTR Investors Roundtable Tbilisi (During DeGameFi)
Oct 17 VNTR Investors Roundtable Dubai (During GITEX Global and Expand North Star)
Oct 18 VNTR Investors Roundtable New York (During NY Tech Week)
Oct 19 VNTR Investors Roundtable Lisbon (During Block3000)
Oct 23 VNTR Investors Roundtable Las Vegas (During Money20/20)
Oct 25 VNTR Investors Roundtable Barcelona (During European Blockchain Week)
Nov 1 VNTR Investors Roundtable Hong Kong (During Hong Kong FinTech Week)
Nov 3 VNTR Investors Roundtable Istanbul (During Istanbul Tech Week)
Nov 9 VNTR Investors Roundtable Singapore (During Bloomberg New Economy Forum)
Nov 14 VNTR Investors Roundtable Lisbon (During Web Summit)
Dec 1 VNTR Investors Roundtable Helsinki (During SLUSH)
Dec 10 VNTR Investors Roundtable Miami (During Art Basel Miami)
RSVP to Upcoming VNTR Capital Events
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UPCOMING VC EVENTS
Sep 1-5 IFA Berlin. Germany
Sep 4-5 Seamless, Riyadh, Saudi Arabia
Sep 6-7 DLD, Munich, Germany
Sep 11-13 Permissionless II, Austin, Texas
Sep 12-17 Crypto Valley and Crypto Oasis Festival, Zug / Zurich, Switzerland
Sep 12-14 Dreamforce, San Francisco, USA
Sep 12-19 Berlin Blockchain Week, Berlin, Germany
Sep 12-13 MoneyLive Asia, Singapore
Sep 12-14 Glendale Tech Week, LA, USA
Sep 13-14 Token2049 Asia, Singapore (10% off with VNTRCAPITAL)
Sep 18-19 IPEM Paris, France
Sep 19-21 TechCrunch Disrupt 2023
Sep 19-22 Super Return Asia, Singapore
Sep 20-21 DMEXCO, Cologne, Germany
Sep 21-22 Metaverse Summit, Paris, France
Sep 21-23 TechSparks 2023, Bengaluru, India
Sep 24-26 Bits and Pretzels, Munich, Germany
Sep 26-28 Meridian by Stellar, Madrid, Spain
Sep 26-28 Mobile World Congress, Las Vegas, USA
Sep 27-30 Monaco Yacht Show, Monaco
Oct 3-4 CV Summit, Zug, Switzerland
Oct 4-5 Sifted Summit, London, UK
Oct 5-6 Zebu Live, London, UK
Oct 7-8 DeGameFi, Tbilisi, Georgia (10% off VIP passes with VNTRVIP10)
Oct 8-9 Wow Summit, Dubai, UAE
Oct 15-18 Expand North Star Dubai Harbour, UAE
Oct 16-20 GITEX Global, Dubai, UAE (free for qualified investors)
Oct 16-22 NY Tech Week, New York, USA
Oct 19-21 VC Weekend, Dubai, UAE
Oct 20-23 Plan B Forum, Lugano, Switzerland
Oct 22-24 Money 20/20, Las Vegas, USA
Oct 24-26 Digital Nigeria, Abuja, Nigeria
Oct 24-25 Blockchain Life 2023, Dubai, UAE
Oct 30-Nov 3 Solana Breakpoint, Amsterdam, Netherlands
Oct 30-Nov 5 Hong Kong FinTech Week, Hong Kong
Nov 7-10 Nearcon, Lisbon, Portugal
Nov 11-12 Australian Crypto Convention, Melbourne, Australia
Nov 13-16 Web Summit, Lisbon, Portugal
Nov 13 Europas, Lisbon, Portugal
Nov 13-17 AIBC Europe, Malta
Nov 14-16 SALT iConnections Asia, Singapore
Nov 15-17 Singapore Fintech Festival, Singapore
Nov 30-Dec1 SLUSH, Helsinki, Finland
Dec 4-5 Next Block Expo, Berlin, Germany
Dec 4-8 West Tech Fest, Perth, Australia
Dec 8-10 Art Basel, Miami, USA
If you would like to submit VC-related events, please respond to this email or Telegram @byuric
Follow us on Social media: Instagram, LinkedIn, Facebook, Flickr, and Twitter.
Check out VNTR Capital upcoming events
VC Reads
Many Of 2021’s IPOs Have Flopped. What Does That Mean For 2023’s Hopefuls?
Close to half of the 171 companies that went public in 2021 at billion-dollar-plus valuations and are still trading are now worth less than $500 million. Just 40% of 2021’s IPOs are worth more than $1 billion. The figures, from an analysis of The Crunchbase Billion-Dollar Exits Board, reveal that even as the IPO markets show signs of life, startups eyeing a public-market debut will face intense headwinds. Companies are getting ready to test the market’s interest in new technology listings, as evidenced by Arm Holdings’ IPO filing on Monday and Instacart’s expected filing. “Our entire ecosystem is based upon the flywheel of liquidity,” said Larry Aschebrook, managing partner at Chicago-based growth investor G Squared, which counts a number of late-stage unicorns in its portfolio, including Instacart, Bolt, Snyk and Flexport.
State of the Series B ecosystem
In the report, we unveil the intricate tapestry of the Series B ecosystem to share a high level view of current trends for Series B investors. In this post, we present a distilled summary of the report's core findings, offering preliminary insights into the implications that these trends hold for the broader venture ecosystem.
The motivation behind this report stems from a desire to bridge the gap between the prevailing gloomy sentiment in venture capital discourse and the realities that the 2023 Series B data presents. Contrary to the downbeat narrative, the data tells a different story, showcasing a resilience that has often been overshadowed.
Fund of funds: why to invest and, more importantly, why not
In stark contrast to the private equity and venture capital business, fund investment business is not that sexy. In fact, I often wonder how I ended up here. At dinner parties, whenever I am asked to explain what I do, and I tell them that I invest into private equity and venture capital funds, I can see them glancing over my shoulder to find another person to talk to. And I get it. It seems abstract and boring at first. But I do believe it can be very interesting from a strategic, analytical and even philosophical point of view. For that and mostly other reasons, it seemed a good idea to explain some more about fund investments. Below the first piece on fund of funds. Our bread and butter at Welt and Marktlink Capital.
Cracking Open the IPO Window
Which companies follow Arm in going public?
IPOs have been few and far between in 2023, especially in the tech sector. Arm filed their F-1 prospectus yesterday in what will almost surely be the largest tech IPO in 2023.
Their filing and subsequent IPO could mark a gradual opening of the IPO window, although some companies might wait to see how their IPO fares.
New SEC Rules Could Hurt VC’s Newcomers
The U.S. Securities and Exchange Commission approved new rules for private funds Wednesday meant to give limited partners—the individuals and institutions that invest in these funds—more transparency. The ramifications for the much larger private equity industry have drawn most of the attention, but venture capital funds will also need to bend to the new rules. VC firms will have to provide their LPs quarterly financial statements, which remarkably isn’t standard for all firms. They’ll also have to perform annual audits for each fund they manage.
SEC makes biggest overhaul of $20T private equity, hedge fund industry in years
The Securities and Exchange Commission on Wednesday voted to overhaul rules for private equity and hedge funds, but in a victory for the industry did not make it easier for investors to sue fund managers and also did not ban arrangements that make it easier for some investors to cash out than others.
The securities regulator’s five-member panel voted 3-2 in favor of a series of changes aimed at increasing transparency, fairness and accountability in the private funds industry, which has more than doubled its assets over the past decade. The industry manages around $20 trillion in assets.
The new rules require private funds to issue quarterly fee and performance reports and disclose certain fee structures while barring giving some investors preferential treatment over redemptions and portfolio exposure. The rules also require funds to perform annual audits.
The Week’s 10 Biggest Funding Rounds: Axiom Space Rockets To Top Spot In Out-Of-This-World Week
This week made us check the calendar to make sure we aren’t still living in the free-money days of 2021. Eight rounds this week topped nine figures, and three of those were more than a quarter-billion dollars. This may simply be coincidence — or companies wanting to announce rounds before what is likely a slow news week with the Labor Day holiday — but nevertheless, it is surprising considering the current state of the venture market.
Why Do Investors Care So Much About LTV:CAC?
To put it simply: higher LTV:CAC → higher margins → higher valuation.
Investors often use 3x LTV:CAC as a rough benchmark of a consumer company’s financial health. If your customer lifetime value (LTV) is 3 or more times your customer acquisition cost (CAC) within 5 years, that means your company has efficient returns on sales and marketing spend. But there’s little discussion of how a higher LTV:CAC actually translates to long-term profitability and, ultimately, valuation.
Solid unit economics has a cascading effect across your business: a higher LTV:CAC ratio means for every dollar of sales and marketing investment, your company has higher margins and so more profit to reinvest back into its business, which means that you can build better products and, hopefully, capture more market demand. Companies are ultimately valued on their future cash flow generation, so the higher your margins, the higher your valuation.
In fact, improving your LTV:CAC from 2x to 3x can nearly triple your valuation
Venture capital’s cold war
The India-based VC firm Peak XV is having an exciting few months. A TechCrunch report on Friday laid out the firm’s good news, bragging that it had signed 10 new term sheets and made three exits since it split with the U.S.-based Sequoia Capital in June. By all accounts the firm is thriving, at least by the numbers, and it’s a perfect example of how the global venture capital game is fracturing. Startup funding is going through the same chaotic decoupling that’s roiling supply chains and semiconductors — and just like hardware, it’s mostly about the rivalry between the U.S. and China. As VCs in the U.S. pour money into the next generation of companies, China hawks in the U.S. government want to make sure those funds aren’t flowing to America’s enemies. At the same time, VCs want to put the money where it will have a chance to grow — and increasingly, that means looking outside the U.S.
How Weather Startups Are Holding Up In A Dryer Funding Climate
With extreme weather on the rise, tools to predict and help take precautions against potentially damaging events are more in demand than ever. As a result, we’ve seen some brisk dealmaking over the past couple of years in providers of weather forecasting and analytics tools. This week, private equity firm Francisco Partners became the latest to storm into the weather space, announcing its acquisition of The Weather Co. assets from IBM. Although the purchase price wasn’t disclosed, an earlier report pegged the price tag at more than $1 billion. There’s a huge audience included. Per Francisco, the weather forecasting apps and websites included in the purchase serve an estimated 415 million people each month. The deal comes amid a period of sharp growth for the weather forecasting industry. Revenue from weather apps alone is projected to grow at more than 11% annually from 2022 to 2027. Other verticals, including weather tracking technologies and analytics tools for insurers, are also seeing stepped-up interest and growth prospects.
Startup World Looks On As Arm And Instacart Set To Test Waters Of IPO Market
After nearly two years, the tech IPO market may finally be reawakening, setting the stage for a broader rebound in 2024.
Two expected IPOs in particular will be closely watched by the long backlog of heavily-funded startups waiting in the wings to make their market debuts: Arm Holdings and Instacart.
The performance of the two very different highly valued and well-branded companies — Arm, which benefits from the demand for processing power for AI, and Instacart, a grocery delivery service that experienced high growth during the pandemic — will be a test of investor appetite for the next wave of technology IPOs.
How AI is Transforming Venture Capital and the Future of Investing
Harnessing the raw power of artificial intelligence, venture capital and investing are being redefined as we know it – forging new pathways, altering decision-making, and shaping a future teeming with untapped potential. In this revolutionary wave, traditional models are being overhauled in favor of enhanced speed, accuracy, and efficiency. Immerse yourself in this transformative journey as we decode how AI stands as the game-changer for Venture Capital and investing realms, presenting opportunities previously confined within the realm of science fiction. Dive into an unprecedented era where algorithms influence billion-dollar decisions and dictate the trajectory of global finance.
Why Mega Funds Exist
VCs are just middlemen. Whilst a select few are rich enough to invest their own money, 99% of VCs raise money from rich people, large institutions and other corporations.
In particular, the backbone of the VC ecosystem is institutional investors such as college endowments, pension funds and large foundations.
VCs have a fiduciary duty to deploy their capital responsibly. However, in recent times, the incentives guiding institutional investors, VCs and the founders that receive investment misaligned.
Sweeping U.S. Tax Proposal Met With Boos From Crypto World
An immediate burst of criticism from the crypto industry shows the U.S. Treasury Department’s new proposal on how to handle digital assets taxes will face a long road as it enters a months-long period of public comments and hearings. X, the site formerly known as Twitter, quickly filled with complaints about the proposal’s scope – particularly how the tax-reporting demands may capture decentralized crypto operations that the industry would argue are impossible to bring into compliance. Miller Whitehouse-Levine, the CEO of a decentralized finance (DeFi) lobbying group, said on the social media platform that the proposal as written is “overbroad,” with provisions allowing it to capture all sorts of entities. He pointed to self-hosted, or unhosted, wallets as one example.
Realizing non-winners early drives IRRs
Exiting portfolio companies stands as one of the most overlooked skills in venture capital. The significance of recognizing non-winners early can create the distinction between a good and a top-tier CV fund. In this context, exiting doesn't solely pertain to selling portfolio winners; it's equally about divesting from the medium and non-performers as soon as feasible to capture maximum value for LPs.
Selling portfolio winners resembles offering candy to children, while selling mid- and non-performers is more akin to selling sand in the desert. Some gps believe companies are bought (a sit-and-wait strategy), while others believe companies should be sold (a plan-and-push strategy). I firmly advocate for the latter - GPs should consider hiring a chief of exit for the second half of a fund term.
How to size your VC fund
Current first-time fund managers don’t have access to the seemingly endless supply of cash and optimism that their predecessors did in the heyday of 2021. Yet, despite the economic downturn, LPs pulling out of commitments, reduced risk appetite and the hundreds of rejections first-time fund managers have reported, new VC funds are still popping up across Europe. To raise a fund, an emerging fund manager — a first time fund manager trying to start up a new venture capital fund — has to consider several factors when totting up the total they plan to raise. Current market conditions, the stage and sector you plan to invest in, team experience and networking ability all play a significant role. Sifted spoke to emerging fund managers in London, Paris, Berlin, Barcelona, Amsterdam and Tallinn to help you figure out how much you should be raising for your first ever fund.
Saudi Arabia Investment Is Increasing In US-Based Startups
Earlier this month, U.S.-based networking startup Nile announced a large $175 million Series C co-led by March Capital and Saudi Arabia sovereign wealth fund Sanabil Investments. That was followed this week by Houston-based Axiom Space locking up a $350 million round led by Saudi Arabia’s Aljazira Capital — its first investment in a U.S.-based startup, per Crunchbase data — and Korean health care company Boryung Pharmaceutical. Although the two rounds may not seem to have much in common, they do share something — they illustrate the growing appetite Saudi Arabia-based investors have in U.S. startups. While Saudi Arabia investment in energy and even sports — think LIV Golf merging with the PGA Tour — has been well highlighted, Saudi sovereign wealth funds, corporate venture arms and other firms are exploring more deals, worth more money, involving U.S.-based startups than ever before, Crunchbase data shows.
Crypto VC inflows drop further as macro factors weigh on investments
July saw a drop in capital inflows from venture capitalists by 10.26% resulting in $700 million raised according to Cointelegraph Research VC Database. The last two months rejected the potential upward trend, as it seems that macroeconomic conditions revolving around the United States Federal Reserve rate hikes and geopolitical events are still having a more severe impact on VCs’ decision making. With this in mind, many firms are staying risk-off with most of their reserves, while some are deploying portions of capital to value investments. Generally, VCs are closely examining each new project for potential investment opportunities, preferring to follow smart money instead of taking stabs in the dark.
3 Reasons Now May Be The Perfect Time To Launch A Startup
Call me an optimist, but when everyone is saying how bad times are to raise capital and how bad the economy is, I prefer to see the opportunity. In the ever-evolving landscape of entrepreneurship, timing is crucial, and going against the crowd is essential. Good companies can come out of difficult times — remember that Uber and WhatsApp both came out of the 2008 recession. The current state of the world presents a unique set of circumstances that make it an ideal moment for aspiring entrepreneurs to take the plunge. Here are three compelling reasons why now could be the perfect time to create a new venture.
How to play the private equity game without a fund
In 1998, Scott Dickes left his job as a vice president at a private equity firm and embarked on the quixotic journey of a fundless sponsor. A fundless sponsor (or "independent sponsor," per a more recent conceptual rebrand) is an investor that pursues a deal without the security of the committed capital in a PE fund. A typical timeline for an independent sponsor starts when a PE professional spins out of an established investment shop, spots an asset that shows some potential, negotiates the acquisition, and scrambles to get the equity financing and leverage later. An independent sponsor bypasses the woes (and stability) of a commingled fund, taking on a single or handful of investors—usually another private market firm or a family office—for a single deal.
What’s hot — and what’s not — for Europe’s Gen Z VCs?
Gen Z has begun to make its mark on Europe’s VC scene, sourcing startups and working on deals at some of the ecosystem’s most active firms. Best known until now as the generation to drive the newest viral TikTok trends and kill off skinny jeans, they’re also flexing their muscles as future unicorn pickers — so, which sectors are they interested in right now? Founder of the global Gen Z VCs community group, Meagan Loyst, conducted a survey of more than 700 people to find out what’s hot — and what’s not — among European VC’s youngest generation. The respondents were all attendees of a series of events for Gen Z VCs in eight of Europe’s tech hubs: London, Paris, Berlin, Milan, Copenhagen, Barcelona, Stockholm and Amsterdam.
VCs should give up on the winner-takes-all approach to investing
Venture capital is the business of hitting home runs. But must a startup have the potential to capture the vast majority of market share in its category to earn an investment? I don’t think so. A few days ago, the co-founder and CEO of Thumbtack, Marco Zappacosta, came on TechCrunch’s Found podcast to talk about building his home services startup. I asked him what was next for Thumbtack, considering the startup is 15 years old and was last valued at $3.1 billion. I thought he might talk about a potential exit, but his answer surprised me. “For our industry, [the adoption of booking home services online on a platform like Thumbtack] is less than 10%. We are still in the very early days of this sort of transition in evolution. I think people don’t appreciate how big this category can and will be,” Zappacosta said. “It also speaks to what we’re still trying to do, because we think we’re still early in this whole sector.”
PE splurges on Europe's undervalued software sector
The appeal of high profit margins and low valuations is fueling private equity investment in European software companies, with this year's total deal value on course to nearly match that of 2022. So far this year, €36.9 billion (roughly $40 billion) has been invested in European software companies across 415 deals despite a tough dealmaking environment. That is more than half the €64 billion invested across 870 deals last year. During the surge in software investment in 2021 and 2022, €146 billion was invested across 1,795 deals, according to PitchBook data. Many of the biggest deals have been take-privates. While PitchBook's Q2 2023 European PE Breakdown noted that take-private activity has remained subdued this year, it appears even in a difficult fundraising environment, firms are willing to pay for listed software companies.
Investors bet on generative AI to revolutionize drug discovery
By now, most tech investors, businesses and even consumers are aware of the promise of generative AI to transform fields from software programming and advertising to video game development and movie production. But the use of large language and diffusion models to discover medicines is not widely discussed. While there still aren't many biotech startups that are employing generative AI methods to create novel drug compounds, some early adopters have succeeded in raising substantive funding in recent months. "We are in [the] very early days of how generative AI is going to be applied in life sciences, but I think the applications in drug discovery are potentially profound," said Greg Yap, a partner at Menlo Ventures. His firm is a backer of Genesis Therapeutics, a biotech startup that uses various AI methods, including generative AI, to design new drug candidates. Earlier this week, the Burlingame, Calif.-based company raised a $200 million Series B co-led by Andreessen Horowitz.
Bitcoin Dreams Are Coming True in Argentina and Turkey
Right before the volatility in digital assets late last week and the breakout of bitcoin to the downside due to rising interest rates and low market liquidity, Javier Milei made global news by unexpectedly winning the Argentinean primary election. A libertarian candidate and member of the "La Libertad Avanza" party, Milei is a Bitcoin advocate, saying it “represents the return of money to its original creator, the private sector.” He also calls for the abolition of the country’s central bank, which, he says, "is a scam, a mechanism by which politicians cheat the good people with inflationary tax.” While it’s unsurprising that a candidate in a country infamous for inflation (currently estimated above about 100% annualized) would have a critical view of the central bank, it does raise questions more broadly about the global experience for cryptocurrency holders.
New SEC rules could arm LPs with more negotiating power
The SEC's latest adoption could take some negotiating power away from private investment fund managers and place it in the hands of LPs. In a Wednesday open meeting, the SEC voted to approve a set of new rules and amendments to the Investment Advisers Act of 1940. While more flexible than the initial proposal floated in February 2022, private fund managers will face prohibitions on preferential terms, a popular tactic used in negotiations between fund managers and their investors. Other key changes will require private funds to provide quarterly financial statements to investors and receive a fairness or valuation opinion on GP-led secondary transactions. The SEC removed the controversial liability rule, which would have held fund managers legally responsible for negligence.
Venture Capital Trusts: Proving a pillar of support for UK's expanding startups
No fear of VCTs suffering the downturn as the Venture Capital Trust Association (VCTA) published figures today that say the deployment of capital into early-stage startups grew 8% year-on-year to £664 million. Positive news compared to the UK venture capital figures which say funding fell by almost a quarter (23 percent) in 2022. The data was gathered from over 600 early-stage companies that have benefited from VCT funding. That £664 million of capital was deployed across 345 investments, and raised in excess of £1 billion of new capital for the second year running. Total sales of VCT supported companies totalled £18.18 billion in 2022, growth of 54% versus 2021. Exports also rose significantly, with export sales totalling over £3.7 billion in 2022, up 29.8% from £2.9 billion in 2021, illustrating the growing number of businesses which are expanding overseas.
At the Top SaaS Companies, Founder-CEOs Own ~15% at IPO. And Most Co-Founders Are Not Equal
I was curious a while back how many of the recent Cloud and SaaS IPOs had founders that were equal co-founders from an equity perspective. That was how I was brought up (the first start-up job I had, the founders were equal shareholders). And I generally thought that 50:50 was the default, albeit with many exceptions.
Well, I was wrong.
Only 4 of the most recent ~30 SaaS/Cloud IPOs I looked at had equal founder ownership at IPO, Atlassian, Pagerduty, and (close enough) MongoDB and Amplitude
Tech's broken promises: Streaming is now just as expensive and confusing as cable. Ubers cost as much as taxis. And the cloud is no longer cheap.
Sooner or later, everything old is new again.
We may be at this point in tech, where supposedly revolutionary products are becoming eerily similar to the previous offerings they were supposed to beat.
Take video streaming. In search of better profitability, Netflix, Disney, and other providers have been raising prices. The various bundles are now as annoyingly confusing as cable, and they cost basically the same. Somehow, we're also paying to watch ads. How did that happen?
Global Venture Capital Market 2023-2028: Accel Partners, Andreessen Horowitz, Sequoia Capital, and Lightspeed Venture Partners Among Key Players
The global Venture Capital market is estimated to be USD 210.02 Bn in 2023 and is projected to reach USD 293.19 Bn by 2028, growing at a CAGR of 6.9% during the forecast period (2023-2028), according to a new report by ResearchAndMarkets.
Venture capital is a type of private equity that funds startup businesses and is highly required for initial setup or expansion. The market is expanding due to the rising number of startups and venture capital investments from mutual funds and banking organizations. Additionally, increasing investment activities in various industry verticals, such as healthcare, biotechnology, agriculture, and media and entertainment, are supporting market growth.
Meaningful Exits for Founders
For an industry that doesn’t do it for the money, we sure talk about money an awful lot in the world of startups.
According to Sam’s math, a meaningful exit for a fund should have the ability to return 33% of a given VCs fund, a “home run” exit should be able to return their entire fund in a single investment.