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| Hey Insiders, Today we are bringing you an analysis of why Insight Partners lowered its fund targets and how TCV is having difficulty raising fresh funds. We have also rounded up the leadership changes in the VC sector for this week. 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 | | New York-based VC firm Insight Partners has lowered the fundraising target of its 13th fund from $20B to $15B. So far, the firm has secured commitments worth $2B toward the new fund. However, it informed institutional backers about its decision citing the "great reset in tech." More: - The firm still has about $10B of dry powder available from its previous funds but will slow down its deployment as it is "not seeing a volume of companies that [it is] excited about."
- The firm has deployed $14B out of the $20B raised for its 12th fund.
- Insight participated in deals worth $25B in 2021 before slowing down its deployment to $14.4B the following year, in line with the global VC funding slump.
- Insight told investors, "In 2021, we saw exceptional growth in technology demand but challenging valuations and a lack of discipline around cost structures and rates of cash burn. We believe the great reset has solved those two challenges."
Zoom out: - U.S.-based VC firms raised record-high funds worth $171B in 2022, exceeding the previous record of $154B set in 2021.
- However, the trend reversed this year, with U.S. VCs raising only $12B in Q1 2023.
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| 2 | | Israeli seed and early-stage VC firm Glilot Capital hired Neil Sherman as a venture partner. Sherman was formerly a managing director at Credit Suisse and JP Morgan. He is tasked with leading the firm's expansion, especially in the U.S. Other VC firms, Gilde Healthcare, EQT, and Fidelity Investments, also saw leadership changes this week. Hires: - Fidelity Investments appointed former SVB director Kristen Craft as vice president of strategic partner management.
- Swedish PE and VC firm EQT Growth is reportedly hiring Goldman Sachs Growth Equity's managing director Kirk Lepke as a partner.
- Rich Wilmot is set to join investment firm Gilde Healthcare's U.S. Venture & Growth team as a partner.
Promotions: - Last week, Alphabet's VC division GV promoted four partners, Issi Rozen, Frédérique Dame, Brendan Bulik-Sullivan, and Crystal Huang, to the general partner role.
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| 3 | | Notable VC firm Technology Crossover Ventures, popularly referred to as TCV, has raised between 50% to 75% lower than the targeted sum of $5.5B for its next flagship fund, per securities filings and documents seen by The Information. It is unclear if the firm has closed its fundraising. Nevertheless, the news suggests that even notable venture firms are having difficulty raising new funds. More: - The filings show that TCV raised $1.4B for its next flagship fund, with another $1.35B across four new funds.
- Assuming the latter funds are linked to the flagship fund, the firm has collectively secured $2.75B toward its next fund, 50% less than its original target.
- TCV's previous flagship funds closed at $4B in 2021 and $3B in 2019.
Zoom out: - Due to the macroeconomic headwinds and lack of market liquidity, VC firms are having difficulty raising fresh funds.
- TCV's peer Tiger Global Management lowered its fundraising target twice, dropping it from the initial target of $12B to $5B.
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| 4 | | Alphabet-backed fintech startup GoCardless is laying off 135 employees, or 15% of its workforce, in a bid to cut costs. CEO Hiroki Takeuchi said the layoffs aim to lower company costs by 15%. More: - The job cuts will reduce the senior executive members in its workforce by 25%.
- After the layoffs, the firm expects to have a workforce of just under 800 employees.
- The British payment processing startup has raised nearly $530M from investors, the last of which came in through a $312M Series G round led by Permira in early 2022.
- GoCardless was valued at $2.1B at its last funding round.
- The firm is backed by Alphabet's venture capital arm GV, BlackRock, Bain Capital Ventures, Accel, and others.
Zoom out: - News of GoCardless's layoffs come as VC funding for European tech startups is expected to drop 39% to $51B by the end of this year, per Atomico.
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| 5 | | Canadian automotive software company LeddarTech intends to go public via a SPAC merger with blank check firm Prospector Capital Corp. The transaction will give the firm a pro forma equity valuation of $348M. Per Crunchbase, LeddarTech has raised $347.5M in equity and debt funding from investors to date. More: - LeddarTech is set to receive $66M in gross proceeds, consisting of $23M from the blank check entity and the remaining $43M from a private investment in public equity (PIPE) transaction.
- The firm intends to use the incoming proceeds to commercialize its embedded software solutions and expand its product line.
- The blank check company is led by Qualcomm's former president Derek Aberle and raised $325M through an initial offering in 2021.
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| 6 | | Top Funding: AI - AI-powered video generation platform Synthesia raised $90M Series C funding led by Accel at a $1B post-money valuation. Nvidia's VC arm NVentures, Kleiner Perkins, GV, Firstmark Capital, and others backed the funding round.
Cybersecurity - Dutch digital identity security startup Truvity raised €8M ($8.6M) in fresh funding from Artek Group.
DeepTech - Singaporean high-reliability semiconductor solutions developer Zero-Error Systems raised $7.5M through its Series A funding round. Airbus Ventures and Dart Family Office participated in the funding round.
Energy - Battery storage developer Granite Storage received $40M in strategic growth capital from New Energy Capital.
Fintech - Canadian online wealth management and financial services platform OneVest nabbed $12.7M (CA$17M) in Series A funding led by OMERS Ventures. Luge Capital, Panache Ventures, FJ Labs, Fin Capital, and Deloitte Ventures supported the funding round.
Healthcare - Virtual patient care solutions startup Electronic Caregiver is looking to raise $90M in Series A funding to drive expansion efforts.
Machine Learning - Austin, Texas-based machine learning operations solutions maker Striveworks secured $33M through an equity fundraising led by Centana Growth Partners.
PropTech - Building management software maker Helixintel nabbed $11M in Series A funding led by National Grid Partners, with participation from Munich Re Ventures, Stellifi, and Motivate Ventures.
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- Kyber Knight Capital secured $120M from limited partners toward its debut fund to back e-commerce, gaming, media, entertainment, and AI startups.
- Nordic VC firm Voima Ventures held the first close of its third fund at €90M ($97.4M) against a final target of €120M ($130M). The Finnish VC firm intends to back early-stage deep tech startups, mostly emerging from university labs and research institutions.
- Africa Finance Corp.'s AFC Capital Partners secured $300M in capital commitments towards its Africa Climate Adaptation Fund. United Nations-backed Green Climate Fund is the anchor investor in the fund, which intends to close between $450M and $500M by early 2024.
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Aaron Crutchfield | |
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