SEC Adopts Amendments to the SPAC and de-SPAC Disclosure and Investor Protection Rules

On March 30, 2022, the Securities and Exchange Commission (SEC) proposed amendments to the rules governing disclosures and investor protections in initial public offerings (IPOs) by special purpose acquisition companies (SPACs) and in subsequent business combination transactions between SPACs and target companies (de-SPAC transactions). On January 24, 2024, the SEC considered and adopted the proposed amendments to the enhanced SPAC and de-SPAC disclosures. READ MORE

Trump-Linked SPAC Digital World Manages To Attract Critical Funding by Offering Extremely Generous Terms

After formally losing every cent of the original $1 billion in PIPE investments, the Special Purpose Acquisition Company (SPAC) Digital World - which still intends to merge with Truth Social's parent entity, Trump Media and Technology Group (TMTG) - appears to have secured a critical financial lifeline as it continues to navigate the messy labyrinth of its still-pending business combination. READ MORE

Private Equity Highlights and 2024 Outlook

A year of rising interest rates and slower growth has proved challenging for the private equity industry. Yet, despite a decline in fundraising and dealmaking coupled with debt becoming costlier and scarcer, successful PE firms are finding a way. Learn what dealmakers need to know as they harvest their holdings and kickstart capital raising to sustain their investment cycles into 2024. READ MORE

What Boards of Public Companies Can Learn from Private Equity

Public company boards have made quite a few upgrades over the past decade. They have become far more diverse, more focused on risk management, and more attentive to the environmental impacts of the companies they oversee.

But in other ways, public company boards still look eerily similar to what they looked like 50 years ago, when modern governance rules were first enacted after the high-profile collapse of Penn Central. Directors basically still show up to board meetings once a quarter to approve the strategy, discuss risks, and once every five years or so, select the next chief executive officer. READ MORE

3 Ways to Start, Grow, and Sell a Company Without Venture Capital

It is very, very, very difficult to raise venture capital investment for your startup. Especially right now. In fact, one of my investor friends just told Axios that this is the worst startup investment environment he's seen since the Great Recession.

Woof. I'm guessing that like 90 percent of you don't remember that period. It was no fun.

Fine. That's OK. As a career entrepreneur, I wear the customer-first badge. Proudly. I strongly believe raising money through customer sales is the best option, and in a lot of cases, it should be the only option. READ MORE

We forgive? WeWork collapsed but investors are once again embracing Adam Neumann

The venture capital market loves Adam Neumann, there seems to be little doubt about that. On the other hand, among the general public he has a reputation of someone it is better to avoid doing business with. He may be a great marketer who builds excellent brands and convinces investors to attribute high value to his ventures. However, he is also a reminder for a sector of how one should beware of grandiose stories, cosmic promises and the burning cash that end in massive collapses (not his). Now Neumann wants us to learn another lesson: in fact, everything pays off. READ MORE

US and China dominate global high value VC funding deals

Global deal activity, encompassing venture capital (VC) funding, remained subdued in 2023. Key markets such as the US, China, India and the UK also registered a decline in VC funding deal volume and value. However, despite suffering setbacks, the US continued to account for the highest share of high value* VC deals in 2023 followed by China. These two countries collectively accounted for 70% of the total number of high value VC deals announced globally in 2023, reveals GlobalData, publishers of RBI.

Aurojyoti Bose, Lead Analyst at GlobalData, said: “Although there was a dent in investor sentiment globally owing to macroeconomic challenges, inflation, interest hikes, ongoing conflict and geopolitical tensions, countries with conducive startup ecosystems such as the US continue to remain attractive investment destinations. VC firms have become cautious but not averse to placing big bets in promising startups from these countries.” READ MORE

VC distributions sink to 14-year low

Of all the problems that have besieged venture capital in recent years, arguably none is more acute than investors’ difficulties converting their paper returns into cash.

Limited partners are disappointed with how much capital is coming back to them from their venture managers. And they’re less inclined to re-up with VCs that haven’t returned much cash. LPs are closely monitoring a metric called distributed to paid-in capital (DPI), which measures how much capital a manager returned relative to what was invested.

But just how small are recent cash distributions compared to historical levels? READ MORE

US venture capital firms accused of funding blacklisted Chinese AI companies

At least five U.S. venture capital firms have been accused of funding blacklisted Chinese artificial intelligence and semiconductor companies that allegedly aid the Chinese Communist Party in mainland surveillance and oppression operations, according to a new report from the House select committee on China.

GGV Capital, GSR Ventures, Qualcomm Ventures, Sequoia Capital China, and Walden International reportedly funneled more than $1.9 billion to Chinese AI companies and $1.2 billion to China’s chip supply chain, the investigation found. READ MORE

How US venture capital has grown in the last 15 years

After a long positive run, venture capital enters 2024 buffeted by crosswinds.

The market has become choppier due to global pandemic aftershocks, including supply chain disruption, rising inflation, and workplace and productivity changes from remote work adoption.

Though the U.S. economy appears to be headed for a "soft landing," where restrictive monetary policy slows inflation and job growth without leading to unemployment spikes, the belt-tightening steps businesses took in anticipation of a widely predicted recession are squeezing the venture capital industry. READ MORE

How Intent Data Can Shape Corporate Investment

The world of business investment can be fraught with peril. To the general public, the concept of private equity still brings to mind visions of corporate raiders, and venture capital (VC) might be seen as a pure profit enterprise (PE).

Those inside this world know that these perceptions are inaccurate and even insulting. Corporate investment, whether in the form of PE or VC, carries an immense amount of risk for all involved. Too many investments that don’t work out can forever change the fate of a PE or VC firm. READ MORE

M&A of seed-stage startups outshines mature companies

2023 was the worst year in a decade for acquisitions of VC-backed companies. And while buyers were broadly picky, they were much more likely to snap up younger startups—a byproduct of a market that now entices founders to sell early.

Corporate acquirers scooped up 151 seed-stage startups last year in the US, according to the latest PitchBook-NVCA Venture Monitor. That count was the lowest since 2017, but M&A of more mature companies fared much worse: Acquisitions of Series A and later-stage companies have all fallen to a 10-year low. READ MORE

Earnout provisions in private equity deals grew in 2023

Private equity's share of global M&A deals featuring an earnout provision rose last year to its highest level since 2020 as fund managers leaned on deferred payments to close transactions in a challenging dealmaking environment.

The value of all announced M&A deals with earnouts totaled $73.11 billion globally in 2023, falling 34.2% from $111.06 billion in 2022 as overall M&A activity slowed in 2023, according to S&P Global Market Intelligence data. Private equity- and venture capital-backed deals accounted for 26.5% of the 2023 total, up from 17.3% in 2022. READ MORE

Five Trends in Private Capital Fund Formation and Investment

In 2023, private capital pooled funds continued to be an excellent vehicle for investors to invest in different asset classes while allowing for diversity of investments.  Last year, fund sponsors continued to raise large amounts of cash to deploy. The industry is expecting growth over the coming years in each of the major asset classes, with Preqin estimating that US$24.5-trillion will be invested in the alternative industry by 2028. Below, we’ve highlighted some of the most significant developments in private capital funds in 2023 READ MORE