| |
| Hey Insiders, Today we are bringing you an analysis of why CalPERS is increasing allocation to VC, why investors are optimistic about global clean energy despite a funding slump, and why Salesforce is doubling its generative AI fund. Scroll down for some top funding news and quick hits, then let us know which sector-specific funding you'd like to see more of in future issues! Karan
p/karan-chafekar | |
| 1 | | The California Public Employees' Retirement System (CalPERS) is looking to increase its commitments to the VC asset class. Sources informed FT that the fund could potentially ramp up its commitments to $5B in the next few years, up from the current ~$800M. The fund's interest in the asset class comes as it makes up for a "lost decade" of investments when it potentially lost out on $18B of returns after putting private equity investments on hold between 2009 and 2018, per chief investment officer Nicole Musicco. More: - CalPERS is the biggest public pension scheme in the U.S., with $442B in funds under management.
- The majority (73%) of its current portfolio is allocated to the buyout asset class, with just 1% earmarked for venture capital.
- The total private equity allocation is 13% of its overall portfolio, per managing investment director for growth and innovation Anton Orlich.
- CalPERS is undeterred by its recent losses in the VC asset class after writing off nearly $77M in investments in Silicon Valley Bank and Signature Bank.
- In the fiscal year ending June last year, the firm's private equity portfolio delivered 21.3% returns, making it the highest-performing asset class in its portfolio.
- The firm will invest in funds managed by high-quality managers and co-invest alongside them to save on fees and outperformance payouts.
- Additionally, the firm intends to increase its investments in Europe and Asia.
|     | |
| 2 | | 
What the numbers say: Global clean energy startups secured $2.8B in VC funding in Q1 2023, down 40.3% YoY. Quarterly totals declined 23.9% QoQ from Q4 2022's tally of $3.7B. Deal count fell 6.8% QoQ and 29.2% YoY to 138 in the first three months of the year. Relevance: Within the clean energy sector, the intermittent renewable energy sources segment raked in the largest share of funding at $1.3B — up 52% QoQ — followed by the grid infrastructure segment at $674M. Funding for clean fuels increased slightly, unlike dispatchable energy sources, which saw a decline in deal values. Where to see the impact: Solar photovoltaic startups nabbed four of the five largest rounds. Notable funding rounds in the quarter include solar photovoltaic technology startups HuaSun Energy's $291.1M Series B and Enpal's $228.4M Series D rounds. Despite the drop in funding, investors are optimistic about the sector's potential, primarily due to the incentives available under the Inflation Reduction Act and the worldwide trend to reduce dependency on Chinese manufacturers. | | | |
| A message from our sponsor, Landing. |  | | Upgrade Your Corporate Housing Find your perfect home with Landing – the smarter, simpler, and more affordable way to rent. Landing is a new way to rent ready-to-live, month-to-month apartments nationwide in minutes. Landing provide a tailored corporate housing solutions for your every need. - Flexible stay options: 30 days to 12 months or more
- 20,000+ fully furnished apartments in 375+ cities
- Effortlessly manage your team's bookings with a single corporate account
- Find and book 100% online
- Dedicated Landing account manager
- Exclusive price for corporate clients
Experience the future of corporate housing with Landing, and use code INSIDELANDING to save $250! Find Your Landing | |
|
| 3 | | Salesforce is doubling the size of its generative AI venture fund from $250M to $500M. The news comes just four months after it announced the initial commitment in March earlier this year. More: - The cloud-based software products maker also announced its AI-focused line of products would be placed under its AI Cloud product portfolio, sitting alongside fellow major product lines Sales Cloud and Service Cloud.
- The move indicates that Salesforce expects its AI products to be a major driver of growth and revive its sales.
- CEO Marc Benioff said during an earnings call that "generative AI is going to spark a massive new tech buying cycle."
- Salesforce intends to launch AI tools for sales and customer support this summer, after which it intends to roll out AI features for the rest of the products within its portfolio.
Zoom out: - Bloomberg Intelligence predicts that generative AI will produce $1.3T in sales by 2032.
| | | |
| 4 | | Andreessen Horowitz is opening its first international office in the U.K. to invest in crypto startups in the nation. The company anticipates a stronger regulatory environment for cryptocurrency firms in the country. A16z's new office will be led by Sriram Krishnan, one of the firm's four general partners. More: - A16z intends to commence a 12-week accelerator program, dubbed Crypto Startup School, for emerging founders next spring.
- The slump in crypto prices and markdowns on equity investments have wiped off 40% of the value of A16z's inaugural fund.
- The firm raised a $2.2B third crypto fund in 2021 and a $4.5B fund fourth crypto fund in 2022.
Zoom out: - A16z's crypto general partner Chris Dixon expects the U.K.'s regulatory landscape to be conducive to crypto, unlike the U.S., where the SEC has taken an aggressive public stance against the industry.
- "We've been wanting regulatory clarity for a long time. In the U.K., I think it will happen faster because there's more political will," said Dixon.
- The British government released a consultation paper earlier this year highlighting potential proposals for crypto regulation.
| | | |
| A message from our sponsor, Drata. |  | | Achieve compliance for 14+ frameworks to unblock sales and speed up security reviews Don’t lose deals, time, and patience because you’re not compliant. Start winning with automated compliance. Drata takes the manual work out of audits and simplifies security reviews so compliance never gets in the way of sales. That’s why 2,000+ companies, including Lemonade and Notion, use Drata to achieve continuous SOC 2, ISO 27001, PCI DSS, HIPAA, and GDPR compliance. With Drata, you can: - Manage controls, evidence collection, policies, security training, and audits in one place
- Eliminate duplicate work with evidence that maps to multiple frameworks
- Simplify compliance with an easy interface, intuitive workflows, pre-built templates, and plenty of customization
With expert support and step-by-step workflows, Drata is easy to get up and running. And now, Inside readers can get 10% off Drata and waived implementation fees. Let’s put your compliance on autopilot. Request a demo | |
|
| 5 | | Shares of AI and machine learning startups account for 25% to 30% of total investor demand on EquityZen's secondary share marketplace, per co-founder and chief strategy officer Phil Haslett. AI and ML startups have been the most in-demand sectors every month so far this year. Investors unable to participate in funding rounds of AI startups are turning to the secondary markets to scoop up shares from founders, executives, and investors. More: - AngelList CEO Avlok Kohli confirmed the trend, adding, "The interest from investors in secondaries within the AI bucket on AngelList has increased by sixfold over the past few months."
- Per AngelList, AI startups accounted for 19% of all secondary transactions on the platform at the end of Q1 2023, up sixfold from 3% at the start of 2021.
- Another secondary marketplace ForgePoint witnessed a similar trend, with total buy interest for AI startups increasing from 6% in April to 12% in the subsequent month.
- ForgePoint's head of investments, Howe Ng, adds that most of the transactions involve late-stage startups, past their Series C or Series D funding rounds, typically where the employee stock options have vested over time.
| | | |
| 6 | | Top Funding: AI - British blockchain-powered AI computing resources provider Gensyn raised $43M in Series A funding led by Andreessen Horowitz. CoinFund, Canonical Crypto, Protocol Labs, Eden Block, and others participated in the funding round.
- NEA and Bain Capital Ventures led a capital infusion of $45M into the AI efficiency platform Granica.
Biotech - Clinical-stage biotechnology startup Eccogene raised $25M (CNY 180M) in Series B funding co-led by New Alliance Capital and Zhangjiang Healthcare Venture Capital.
- British ophthalmic gene therapy company Beacon Therapeutics secured $120M (£96M) in fresh funding led by Syncona with additional backing from Oxford Science Enterprises (OSE).
Climate Tech - Climate impact verification startup Sustaincert raised $37M in Series B funding from Partech, Hartree Partners, Citizen Capital, Innovacom, and Microsoft's Climate Innovation Fund.
E-commerce - French B2B e-commerce startup Djust nabbed €12M ($13M) in fresh funding led by NEA.
Healthcare - Women's health and fertility startup Oova raised $10.3M in Series A funding led by Spero Ventures.
Transportation - Spanish freight transport startup Trucksters closed its Series B funding round at €33M ($35.5M). Continental's corporate venture capital arm, Volvo Venture Capital AB, and the European Investment Bank (EIB) provided the funding.
| | | |
| 7 | | Quick Hits: - This ultimate guide covers partnership marketing fundamentals, best practices, and key things to consider when choosing the perfect partnership platform.*
- U.S.-based VC firm Altos Ventures received $500M (64.57B won) in capital commitments from investors towards its Altos Korea Opportunity Fund, which will exclusively invest in Korean startups. The fund is backed by notable U.S. university funds, including Harvard University, Northwestern University, Vanderbilt University, and Duke University.
- Slack co-founder Cal Henderson and Sir Richard Branson have backed firstminute capital's third early-stage fund, which has already raised $100M from limited partners. The fund's final close will be held later this year.
- Sequoia Capital will exit its investment in Indian firm Go Fashion, the parent company of clothing brand Go Colors, by liquidating its entire 10.18% stake for ~$13.94 (Rupees 1,135) per share, 5% lower than its closing price from Friday. Sequoia stands to make ~$75M (Rupees 6.25B) from the transaction.
- HSBC rebranded SVB's U.K. division, which it acquired for £1 in an emergency sale, to HSBC Innovation Banking to provide banking services to startups and investors.
- Learn why leading investors have called whiskey casks the ultimate safe-haven investment. Start Investing.*
*This is sponsored content. | | | |
| Upcoming Events | | JUN
14 | | Monthly Meditation guided by Nicholas Whitaker | | | | | | | JUN
15 | | Transform your product roadmap with AI @ A.Team's Generative AI Salon* | | | | | | | JUN
20 | | Contract Negotiations 101 with Mathew Kerbis | | | | | | * This is a sponsored event | | | |
Term of the Day Paid search: Paid search is a form of digital marketing in which advertisers pay per user click on an ad. Paid search ads appear on search engine results pages. Question of the Week What's the most bizarre work-related dream you've ever had? Join the conversation |
INSIDE VENTURE CAPITAL LEADERBOARD (7 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Aaron Crutchfield | |
| |
 | Experience the future of corporate housing with Landing. | |
|
 | Drata gets you audit-ready without all the red tape. Automate compliance.
| |
|
| |
Comments
Post a Comment