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| Hey Insiders, Today we are taking a look at Prosus' criticism of Byju's governance structures, the 48% QoQ drop in global fintech funding, and SoftBank and Symbotic's joint venture. We have also rounded up leadership changes at A16z, Benchmark, and Mach49. Scroll down for some quick hits, and let us know what other content you'd like to see in future issues! Karan
p/karan-chafekar | |
| 1 | | Prosus, the largest external investor in Byju's, has criticized the Indian edtech startup for not having proper regulatory and governance structures in place and disregarding advice and recommendations from its directors. A month ago, the firm's representative Russell Dreisenstock stepped down from Byju's board along with other board members from Sequoia India and Chan Zuckerberg after Byju's failed to submit its audited financial statements on time. More: - The Netherlands-headquartered investment company marked down the value of its 9.6% stake in Byju's to $493M.
- The markdown gives the startup an implied valuation of $5.1B, less than a quarter of its peak valuation of $22B.
- Despite the criticisms and the withdrawal from the board, Prosus continues to "believe in the potential of BYJU'S and its role in revolutionizing access to quality education in India and around the world."
- The recent setback has not damaged Prosus' unwavering commitment to investing in India, and it remains a "long-standing and committed supporter" of Indian entrepreneurship, the company said in a statement.
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What the numbers say: VCs deployed $7.8B into global fintech startups in Q2 2023, per CB Insights. Funding dropped 48% compared to the previous quarter, with Q2's tally reaching the lowest level since 2017. The quarter witnessed nearly $2B worth of mega-rounds over $100M, down 78% QoQ. Mega rounds account for a 26% share of the total funding, down from a peak share of 67% in 2021. Where to see the impact: Within the fintech sector, payments startups witnessed the largest decline in funding of 75% QoQ, ending the quarter with $2B. Digital lending startups declined by 44% to $1B. Relevance: Five startups in the fintech sector held IPO listings in Q2, of which four occurred outside the U.S. The number indicates a slight resurgence over the preceding quarter's tally of four. Despite the increase, the total exit value contracted by 20% QoQ due to a drop in M&A activity in the fintech sector. | | | |
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| 3 | | Andreessen Horowitz roped in Anjney Midha to lead its AI investment efforts. Midha was the co-founder and former CEO of Ubiquity6. Discord acquired Ubiquity6 in 2021, giving Midha the role of VP of platform ecosystem. The firm is not setting up a standalone fund for AI as it expects to divert capital from the $8B worth of dry powder accumulated since 2021. Benchmark and Mach49 also announced new hires today. Hires: - Benchmark hired Victor Lazarte as its newest investment partner.
- Benchmark led a $60M Series A funding into Lazarte's startup Wildlife at a $1.3B valuation.
- He stepped down from the CEO role at Wildlife earlier this March, handing over the reins to former Amazon executive Peter Hill.
- Lazarte's appointment ups the partner count at Benchmark to six. The others are Peter Fenton, Eric Vishria, Chetan Puttagunta, Sarah Tavel, and Miles Grimshaw.
- Growth incubator Mach49 appointed Kevin Ye and Chris Cusack as managing partners of the firm's VC investment division.
- The duo previously worked across several roles at Village Capital.
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| 4 | | SoftBank Group and warehouse automation company Symbotic are forming a joint venture to build AI-powered warehouses. The JV called GreenBox Systems will provide a warehouse-as-a-service offering to clients. SoftBank invested $100M for a 65% stake in the JV. More: - GreenBox inked a contract to buy AI systems worth $7.5B from Symbotic over the next six years.
- The agreement is expected to bring in nearly $500M in annual recurring revenue (ARR) for Symbotic.
Zoom out: - Symbotic went public last year via a SPAC merger with a blank check firm formed by SoftBank at a $5.5B valuation.
- SoftBank made a PIPE investment in Symbotic during the transaction, increasing its stake from 5% to 8%.
- Symbotic's current share prices give it a market capitalization of $22B.
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| 5 | | Sequoia Capital laid off seven members of its talent team as it continues a restructuring amid a venture capital retrenchment. The talent team, which will continue with about two-thirds of its previous headcount, helps portfolio startups with their talent needs. Sequoia's COO Sumaiya Balbale told Forbes that the move was inevitable after the company implemented a hiring freeze. More: - The move is part of efforts to shift from offering "support on a one-on-one level to something that could be delivered to more founders simultaneously," Balbale said.
- With the new model in place, Sequoia will be able to "deliver more support in a scalable way, whether it's a peak or non-peak moment."
- The talent team's leader Jaime Bott departed the firm in April.
Zoom out: - Since the start of the venture capital downturn, the firm lowered its management fees and allowed limited partners to withdraw capital from its evergreen fund.
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| 6 | | Today's Funding: Fintech - Dutch neobank Bunq raised a €100M ($111M) Series C flat round, keeping the same €1.65B ($1.8B) valuation from its last $228M funding round in 2021. Previous backers Pollen Street Capital, Raymond Kasiman, and founder and CEO Ali Niknam provided the funding.
Food - Israeli alternative proteins startup Brevel raised $18.5M in seed funding led by NevaTeam Partners.
Healthcare - Blood diagnostics startup Vital Biosciences has raised $48M in funding to date from Lachy Groom, Northpond Ventures, Sam Altman, Marc Benioff, Labcorp, Inovia Capital, and others.
- Synthetic biology startup A-Alpha Bio nabbed $22.4M in Series A-2 funding led by Perceptive Xontogeny Ventures, with participation from Madrona, Breakout Ventures, and others.
- Medical device company Laplace International held the first close of its Series B round at $12.9M. ShangBay Capital and Features Capital co-led the funding round with additional support from Engage Venture Partners and JWC Ventures.
Space - Space logistics startup Impulse Space raised a $45M Series A funding round led by Raytheon Technologies' venture arm RTX Ventures.
Security - Closed-circuit camera systems startup Solink nabbed $60M in fresh funding. The Series C round was led by Goldman Sachs, and also included Omers Ventures and BDC IT Ventures.
Software - Software startup Nuqleous raised $26M in fresh funding from Blue Ladder Capital.
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| 7 | | Quick Hits - Invest in Virtuix before they ship their VR treadmills to their waitlist, a $100M opportunity. This opportunity ends on 8/10.*
- U.K.'s Treasury Committee called on the government to introduce more tax advantage schemes for startups founded by women and ethnic minorities, which account for only 2% of total venture capital.
- Titletown Tech, a VC firm founded by NFL team Green Bay Packers and Microsoft, secured $70M in capital commitments from 27 investors towards its second fund. The fund will back sports, entertainment, health, agriculture, environment, manufacturing, and supply chain startups around the Midwest.
- Valhalla Ventures announced a $66M fund to back seed-stage startups across deeptech and gaming sectors.
- Singaporean VC firm Resolution Ventures held the final close of its fintech-focused fund Resolution Fintech Fund I.
- Discover how collagen helps reduce loose skin, deep wrinkles, and dark spots.*
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INSIDE VENTURE CAPITAL LEADERBOARD (30 DAYS) |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Eduardo Garcia | |
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