Global Funding And M&A Picked Up In Q2, While AI Funding Mushroomed

Global startup funding picked up in the second quarter, reaching $79 billion — rising 16% quarter over quarter and 12% from the $71 billion invested in Q2 2023. Mega-rounds — fundings $100 million and above — accounted for much of the increase this past quarter.

Funding to companies in AI more than doubled quarter over quarter to $24 billion — representing 30% of all dollars invested, the largest quarter for AI funding in recent years. And there are signs that larger M&A deals increased in Q2, providing much-needed liquidity to venture capital markets. READ MORE

IPO market quickens as stocks hit record highs during H1 2024

The worldwide IPO market in coming quarters faces possible turbulence from intensifying regional conflicts, the uneven pace of monetary easing and “an election super-cycle,” EY said, noting that more than 50% of the world’s population generating nearly 60% of global gross domestic product goes to the polls this year.

Election outcomes “may prompt changes in government spending, debt levels, interest rate policies, currency strength and global supply chains,” EY said. READ MORE

Robotics Startups On The Rise In 2024

So far, 2024 is shaping up as a not-so-shabby year for robotics startup funding.

Developers of workplace robots, robotic surgery technologies, and even humanoid models have all raised large rounds in the past six months. The artificial intelligence funding boom has also helped boost the space, with investors backing big deals at the intersection of AI and robotics. READ MORE

The VC Platform Role: What It Is And Why It Matters

I recently had the pleasure of speaking at the VC Platform Summit in Miami, a 3-day event that brought together 500-plus VC professionals focused on platform roles across 340 firms.

The platform role has come to wear a lot of hats in the world of private capital—from business development to community-building to recruiting and marketing—and matured substantially over the past decade. Perhaps the most central and important theme today is portfolio value creation. READ MORE

Will Regulatory Scrutiny Impact Private Equity Investment in Healthcare?

Over the past decade, private equity investors have shown a particular interest in acquiring or investing in various healthcare providers and services. This includes physician practices across multiple sub-specialties, home healthcare providers, behavioral healthcare clinics, skilled nursing facilities, urgent care clinics, and other specialty clinics. This trend is driven by the attractive returns that healthcare investments have generated, fueled by factors such as a fragmented market, industry growth due to an aging population, technological advancements, and evolving healthcare needs.  READ MORE

Global Venture Capital Outlook: The Latest Trends

In the first quarter of 2024, global venture capital funding grew by approximately 16% quarter over quarter, reaching $89 billion distributed over 4,600 deals (see Figure 1). The US experienced the most substantial spike, with a 72% quarter-over-quarter increase in funding, aided by large investments in technology, AI, energy, and healthcare. China saw a 13% increase in quarter-over-quarter funding, bolstered by investments in the automotive and AI sectors. In contrast, Europe reported a 28% decline in funding, primarily because of ongoing macroeconomic uncertainty and the UK’s technical recession.

Average deal sizes grew across all funding stages, with early-stage deals recording 43% quarter-over-quarter growth, followed by seed- and late-stage deals with sequential growth of 17% and 21%, respectively (see Figure 2). In particular, Series B deals surged, propelled by sectors such as generative AI, clean energy, and healthcare. READ MORE

‘Venture capitalist’ offered to buy Virgin Orbit for $200m. He had ‘less than a buck’ to his name, SEC says

A wannabe venture capitalist who made a “bogus offer” to buy Richard Branson’s satellite company is being sued by the Securities and Exchange Commission (SEC).

Matthew Brown, from Dallas-Fort Worth, owner of investment managing firm Matthew Brown Companies LLC, submitted a fake picture of a bank account in March 2023 that said he had $182 million while trying to purchase Virgin Orbit, a now-defunct company that launched small satellites into orbit, according to the SEC lawsuit. READ MORE

Private Equity Isn't Selling Right Now, But Maybe You Should

A dam has been built in the middle market M&A world. This is no ordinary beaver dam, but the equivalent to that of the Hoover Dam.

This dam's construction reflects a convergence of factors within the private equity sector and the broader M&A transaction landscape. Currently, private equity firms are flush with cash reserves, totaling a staggering $1.2 trillion in buyout funds alone. However, despite this abundance of capital, the market is experiencing an absence of investment opportunities. The low supply of acquisition targets is made worse by several factors, including elevated interest rates, debt multiples at a 10-year low, and traditional lenders being tight with credit and underwriting. All of this makes it difficult for private equity to buy new companies. READ MORE

Navigating DEI When Hiring Executive Leaders In Private Equity

In a historically homogenous sector, diversity rises as a leading differentiator among high performing private equity firms and their portfolio companies. From rising interest rates to increasing C-suite turnover, private equity firms and their portfolio companies have recently faced a spectrum of challenges that have limited their potential to achieve growth, according to a new report from Slayton Search Partners’ Dan Dunn. “Leaders within these firms are embarking on a variety of strategic imperatives to jumpstart their value creation,” he said. “For some, that looks like tapping into industry-specific digital transformation, overhauling their tax strategy, or building strategic ESG initiatives.” READ MORE

What To Know As A First-Time Entrepreneur Seeking Investors

Embarking on my entrepreneurial voyage was akin to setting sails on uncharted waters. It was full of lessons about perseverance, agility and the sheer grit needed to transform an idea into a thriving reality. Now with more experience under my belt, I’ve gained a new perspective on the other side as an investor.

As a result, I co-founded a foundation with another impact investor to provide resources and funding to entrepreneurs like me. Here are the lessons I've learned that can help bridge the seemingly vast expanse between nascent entrepreneurs and seasoned investors. READ MORE

The war on ESG doesn’t make sense. Least of all for taxpayers

“I am really frustrated. They [the VC Funds] don’t want to engage when we ask about ESG but they will have to. We are getting somewhere in all other asset classes already.” During our latest conversations with asset owners and limited partners (LPs) in the U.S., some were complaining that the early-stage venture capital (VC) investors they were investing in weren’t keen on ESG. 

The head of ESG at a major American asset owner explained in depth how many big U.S. VC funds have resisted scrutiny of ESG reporting and integration. This is nearly a standard practice in all other asset classes. READ MORE

Senators introduce bill to criminalize private equity ‘looting’ in healthcare

Senators Ed Markey (D-Mass.) and Elizabeth Warren (D-Mass.) have introduced a bill that would impose criminal penalties for private equity firms that extract wealth from healthcare organizations. 

The Corporate Crimes Against Health Care Act of 2024 would allow federal prosecutors to hold private equity executives liable if the business practices of their healthcare entities result in the death of a patient. Penalties include a stint in a federal prison and stiff fines.

Warren and Markey said the legislation is aimed at curbing “looting” by private equity, where investors purchase healthcare practices and hospitals only to run them out of business by prioritizing short-term profits. READ MORE

3 Ways to Get Venture Capital's Attention

If you're like most founders with a big idea, you will need significant funding to bring it to life. That means you're probably contemplating raising venture capital. Raising VC funds might be one of the most challenging hurdles in your company's early life. This is especially true given the state of VC funding in 2024.

There is no silver bullet to ensure you'll receive VC funds. You'll need assets to attract VC attention. From there, simplicity and clarity are critical to helping you catch VC interest, make it through their process, and receive funding. Importantly, you'll need a large market where your company can grow to a sizable value. READ MORE

Microsoft, Nvidia Lead In Investing In AI Startups, But Others Close Behind

Just last week it was reported chip giant Nvidia, Salesforce Ventures  and Cisco all participated in a $450 million investment for Toronto-based AI startup Cohere. That same day, Cisco and its investment arm — Cisco Investments — made news when it launched a $1 billion AI investment fund.

Those noteworthy machinations by some of the biggest names in tech are just the latest examples of these corporate giants’ desires to at best be leaders in the generative AI sector — and at worst not fall behind. READ MORE

There are risks lurking in the world of private capital

New Orleans is (in)famous for being a party town that seems to inhabit a parallel universe — what happens on Bourbon Street usually stays there, however wild. Not so, however, in America’s fast-expanding private capital world. On Wednesday, the New Orleans-based Fifth Circuit US Court of Appeals ruled in favour of six private equity and hedge fund groups to toss out a transparency rule introduced last year by Securities and Exchange Commission. This had required private equity, hedge fund and real estate groups to start issuing quarterly performance and fee reports, perform annual audits, and to stop giving some investors preferential treatment over redemptions and special access to portfolio holdings. READ MORE

Private equity bosses warn of lower returns

Private equity executives have warned that their industry faces the prospect of years of lower returns as they seek to sell assets following a frenzy of investments during the coronavirus pandemic. After booming in recent years and raising record hauls of cash, buyout groups face a challenge in exiting from trillions of dollars worth of unsold companies. Many of those deals were agreed during the 2021 to 2022 window of low interest rates and buoyant markets. READ MORE

How Startup Investments Help Corporations Accelerate Their Growth

In my experience, corporations often struggle to be more innovative and get ahead in the marketplace. They often develop their own research and development organizations, which are intended to develop new product and technology ideas.

However, such traditional approaches are typically not fast enough to stay ahead of industry trends. Corporations also collaborate with top universities to develop new technologies, but such research partnerships usually move slowly. READ MORE