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Why Venture Fund Sizes Rose Despite the Slow Market
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By Yuliya Chernova, WSJ Pro
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Good day. The venture fundraising market is in the doldrums, except for one aspect of it—fund sizes.
The median venture fund raised in 2023 in the U.S. jumped to $37.4 million, up 44% from the median of $26 million in 2022, according to the latest PitchBook-NVCA Venture Monitor report. That median size is at a high for the past decade.
In other respects, though, raising venture funds was a struggle last year. The total amount collected by all funds dropped 62% to $66.9 billion year-over-year in the U.S., per the report. Just 474 funds closed last year, about a third of the successful fundraises in 2022, according to the data. And the median amount of time to raise a fund rocketed to 15 months, well above historical norms, the report noted.
So it appears that many fewer managers can raise a fund, but when they do, they still raise more than they used to.
One would expect fund sizes to decline in an illiquid market where exit opportunities shrank and limited partners got more skeptical. Also, as median deal sizes and valuations for both early-stage and late-stage startups have fallen, it should be harder for managers to argue that they need more capital.
What accounts for the increased fund size in such conditions?
Read the full story here.
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And now on to the news...
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The pressure by some of Harvard’s money managers adds another dynamic to the tumult that has enveloped elite universities since the attacks on Israel. PHOTO: BRIAN SNYDER/REUTERS
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Harvard Is Trying to Smooth Things Over With Silicon Valley
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Executives atop Harvard University’s $51 billion endowment made an unusual tour of Silicon Valley last week to try to smooth relationships with top venture-capital investors. Some have been upset at the university’s response to the Oct. 7 attacks on Israel, The Wall Street Journal reports.
Some of the venture-capital executives who invest money for Harvard had pushed the endowment’s executives to try to get the university to address their concerns about what they viewed as Harvard’s weak response to the attacks and to antisemitism under former Harvard President Claudine Gay.
Executives at Harvard Management Company, the nation’s largest college endowment, met with firms including Sequoia Capital, Kleiner Perkins and Andreessen Horowitz. They also met with Elad Gil, an Israeli-born investor, and Patrick Collison, the chief executive of payments company Stripe; both are influential in Silicon Valley and have been among those who have been more outspoken to Harvard’s endowment.
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Global Battery Race Heats Up With Billions for Europe’s Northvolt
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One of the world’s most valuable battery startups is raising $3.4 billion in debt from the European Union and a group of banks including JPMorgan Chase, WSJ reports, accelerating a race to build more batteries outside China and take advantage of a tidal wave of clean-energy subsidies. Europe’s Northvolt plans to use the funding to grow battery production at a factory in northern Sweden for customers such as Volkswagen and BMW. It also plans to expand a recycling facility next door that will convert scrap metal and old batteries into reusable battery materials.
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Fashion Giant Faces New IPO Hitch: China’s Cybersecurity Police
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China’s powerful internet regulator is conducting a cybersecurity review of Shein’s data handling and sharing practices as the fast-fashion company seeks Beijing’s blessing for its planned initial public offering, WSJ reports. The Cyberspace Administration of China is looking into the ways Shein handles information on its staff, suppliers and partners in China, as well as whether the company can effectively protect such data from leaking to overseas parties, people familiar with the matter said.
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Uber Is Closing an Alcohol-Delivery Business It Bought for Over $1 Billion Three Years Ago
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Uber said it’s shutting down Drizly, the alcohol-delivery service it acquired for $1.1 billion in 2021, WSJ reports. Drizly said Monday that it would accept its final orders in March. Uber acquired Drizly as part of its foray into the delivery business after pandemic lockdowns boosted alcohol-delivery sales but the Boston-based company quickly faced challenges. Alcohol-delivery sales haven’t captured the U.S. booze market, remaining only a small portion of overall consumption.
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Funds
Thomvest Ventures, which focuses on financial and real estate technology, cybersecurity, cloud and AI infrastructure, raised a new $250 million fund. The firm also promoted Umesh Padval and Nima Wedlake to managing director. The new fund brings Thomvest’s total assets under management to $750 million.
People
Team8 promoted Asaf Azulay as partner and chief marketing officer, and Dror Grof as partner and ideation lead in the firm’s digital health foundry. Azulay joined the firm in 2022 and was previously chief marketing officer at Bank Hapoalim. Grof has been at Team8 since 2021, and was previously at Noogata. With headquarters in New York and Tel Aviv, Team8 focuses on startups in the cyber, data, fintech and digital health sectors.
Hiring platform Textio said Jensen Harris succeeded Kieran Snyder as chief executive officer. Harris was previously chief experience officer. Harris and Snyder, who are married, are co-founders of the company.
Discount grocery app Flashfood promoted Nicholas Bertram to the post of chief executive officer, succeeding Josh Domingues, who will become executive chairman. The company also promoted Jordan Schenck to chief customer officer.
System-on-chip power delivery provider Endura Technologies appointed Michael Sanie as chief executive officer. He was most recently senior vice president and chief marketing executive at Synopsys.
Insurance infrastructure builder AgentSync hired Fabio Salim as president and chief operating officer. He was previously at CB Insights and Gympass.
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Ineratec, a Germany-based sustainable e-fuel supplier, scored more than $129 million in Series B funding led by Piva Capital.
Fullcast, a revenue operations platform, completed a $34 million seed round led by Epic Ventures, which included $4 million in debt.
Vicarius, a vulnerability remediation platform based in New York and Israel, landed $30 million in Series B funding led by Bright Pixel Capital.
Weavix, a Wichita, Kan.-based frontline worker platform, secured $23.6 million in Series B financing. Insight Partners led the round, with Vice President Grace Kotick joining the company’s board.
Prismatic, a Sioux Falls, S.D.-based integration platform for business-to-business software companies, raised $22 million in Series B funding led by Five Elms Capital.
Prometeo, a fintech infrastructure startup connecting global corporations with financial institutions in Latin America, collected $13 million in Series A funding led by Antler Elevate.
Digital Infrastructure, a connected vehicle technology startup with offices in Ann Arbor, Mich., and New York, grabbed an $11.5 million Series A investment led by CoinFund.
Avante, a stealthy Seattle-based enterprise software startup, was seeded with a $10 million investment. Fuse led the funding, and Managing Director Kellan Carter will join the board.
Tibo Energy, a Dutch smart energy management software developer, closed a €3 million seed round led by SET Ventures.
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Former Twitter employee Lauren Fratamico picking up her auction purchase. PHOTO: WILL BERTELSEN
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