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| Hey Insiders, We interviewed Tim Guleri, the managing partner of Sierra Ventures, which closed its 13th fund last week. You can read excerpts from the interview below and watch the entire interview using the link provided. Keep watching this space as we have some more interviews lined up starting the first week of October. If you find this newsletter useful, please share it with your friends and colleagues. Thank you. Thanks, Karan
p/karan-chafekar | |
| 1 | | VC firm GGV Capital split the firm into two independent entities amidst rising tensions between the U.S. and China. The two new entities will have distinct brands, with the move expected to be completed by next March. The move comes a few months after a U.S. congressional committee notified GGV Capital and three other American VC firms that it is investigating its investments in Chinese companies involved in semiconductor, AI, and quantum computing. More: - The U.S.-based entity will continue to invest primarily in the U.S. and Europe, whereas the Asia division will invest in China, Southeast Asia, and South Asia.
- Managing partners Glen Solomon, Hans Tung, Jeff Richards, and Oren Yunger will lead the U.S. division.
- The Asia division will be headquartered in Singapore and led by Jenny Lee and Jinxun Foo.
- The firm also has yuan-denominated funds, which will be operated by a separate brand called Jiyuan.
- GGV had nearly $9.2B in assets under management.
- Notable firms backed by the firm over the years include Alibaba, Airbnb, ByteDance, Xiaomi, Didi Global, and Slack.
Zoom out: Q: Could Sequoia's and GGV's recent separation from their China investment partners potentially influence other VC firms to take a similar path? Join the conversation here. |     | |
| 2 | | VCs deployed $913.8M in late-stage and beyond global startups this week between Sept. 15 and Sept. 22, per Crunchbase data. Transportation startups raked in 31% of the funding this week. Healthcare, insurance, and cybersecurity startups nabbed 20%, 11%, and 8% of the financing, respectively. 
Here are the top five largest rounds announced this week: - Location mapping platform Mapbox closed its Series E funding round at $280M. SoftBank Group led the funding round.
- Surgical robotics startup CMR Surgical raised a $165M Series D funding round from Ally Bridge Group, Cambridge Innovation Capital, Escala Capital, Lightrock, RPMI Railpen, SoftBank Vision Fund 2, Tencent, and Watrium.
- Eden Global Partners led a $100M Series D funding round into insurtech startup Openly.
- Industrial cybersecurity startup Dragos extended its Series D funding round with an additional $74M. The firm maintained its $1.7B post-money valuation from earlier. WestCap led the funding round.
- Curve, a banking platform that consolidates cards and accounts into a single platform, extended its Series C funding round with an additional £58M ($71M) funding, bringing the total raised under the round to £133M ($163M). Britannia, IDC Ventures, Cercano Management, Outward VC, Cohen Circle, and others provided the funding.
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| 3 | | Sierra Ventures closed its 13th fund at $265M on Oct. 12, exceeding the initial target of $250M. We interviewed Sierra Ventures' managing partner, Tim Guleri, where he talked about the firm's investment focus and fundraising strategy. We further dove into the impact of AI, catching outliers, and supporting portfolio startup founders through the downturn. 
Here's a sneak peek into some of the highlights: When asked about the transformational power of generative AI, Tim said, "Generative AI is a brand new animal, which I think is so transformational that I think it has the option and opportunity to rethink existing markets and actually be emergent in building brand new products and classic enterprise pain points… And I think generative AI is going to be quite transformational that we think it's going to have a bull run for multiple decades." We asked Tim about the "right size" fund approach, to which he replied, "So we fundamentally believe that, in general, size is the enemy of returns. So when the funds get massive, the returns don't follow because you have to really find every outsized recurrent company, which statistically are less in every cycle. So we tend to not want to depend on that, and we raise what I call 'right sized funds' to have enough capital to give these companies out of seed or Series A." Finally, we asked Tim about the biggest challenges startups face and how Sierra's CXO network helps founders. Tim said, "So I think the biggest challenge that entrepreneurs have is they need to find product market fit. So they have an idea, then they want to have product-market fit, and then they want to have sales-market fit. So, product market fit is hard because you have to have customers that are willing to spend time with you or prospects. So with us, that's easy because we've known these CIOs for almost two decades now… And that causes entrepreneurs to either find product market fit quickly or fail fast, which is also very important." You can watch the entire interview here. | | | |
| 4 | | British chip design firm Arm Holdings' stock prices briefly dipped below its IPO listing price a week after its public markets debut. Share prices dropped below its IPO listing price of $51 a piece to a low of $49.85 before recovering to $52.16. More: - Arm's share prices, which rallied to nearly $67 after its debut, have consistently dipped for five straight days as the excitement about its IPO fizzles away.
- Some analysts had criticized the firm's IPO valuation, with Bernstein giving it an underperform rating after suggesting that the company might not benefit from the AI boom as investors had hoped.
- Short sellers are reportedly betting against the chip design firm.
Zoom out: - Arm raised $5.23B from its IPO debut on Sept. 13, raising hopes that the market was ready for fresh listings after a draught of 18 months.
- Arm's drop was in line with the 1.8% dip seen in the Nasdaq, as investors were concerned about the Federal Reserve's monetary policy.
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| 5 | | Voyager Capital is looking to raise a sixth fund with a target corpus of $100M, per an SEC filing seen by GeekWire. Voyager's managing director, Diane Fraiman, said that the fund has a hard cap of $125M. The firm invests in B2B startups working in SaaS, cloud infrastructure, AI, and ML sectors. More: - The new fund's size is the same as its predecessor from 2019.
- Voyager had invested in nearly 75 startups in the Pacific Midwest, across Washington, Oregon, British Columbia, and Alberta.
- Notable startups in its portfolio are Carbon Robotics, Treasury24, WellSaid Labs, Hiya, and Syndio.
- The firm has more than $520M in assets under management.
Zoom out: - The fundraising climate has become tough this year, with 233 VC funds raising just $33.3B in capital.
- In comparison, VC firms raised funds worth $167B in 2022.
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| 6 | | Today's Funding: Fintech - Digital asset transfer, crypto payments, and account aggregation fintech Mesh, formerly Front Finance, bagged $22M in funding. Money Forward led the Series A round with participation from Galaxy, Samsung Next, Streamlined Ventures, SNR.VC, Valon Capital, Florida Funders, and Altair Capital.
Robotics - Healthcare automation robotics startup Diligent Robotics secured $25M in fresh funding led by Canaan. True Ventures, DNX Ventures, Next Coast Ventures, and Northwestern Medicine Innovation participated in the funding round.
Transportation - Germany-based self-driving truck startup Fernride extended its Series A funding round with $19M in fresh funding, which brings the total raised under the round to $50M. Deep Tech and Climate Funds (DTCF), Munich Re Ventures, Bayern Kapital, and Klaus Kleinfeld provided the funding.
Web3 - Bastion, a Web3 startup launched by former Andreessen Horowitz executives Nassim Eddequiouaq and Riyaz Faizullabhoy, bagged $25M in seed funding. A16z crypto led the funding, joined by Autograph, Laser Digital Ventures, Not Boring Capital, Robot Ventures, Alchemy Ventures, and Aptos Ventures.
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- Cisco Systems is set to acquire cybersecurity firm Splunk for $28B. The acquisition cost translates to $157 per share, representing a 31% premium over Splunk's last closing price.
- Former SoftBank Vision Fund's vice president Justina Chung joined Bessemer Venture Partners.
- Early-stage B2B investor Underscore VC has set a target of $50M for its third fund.
- Blume Equity secured a €40M ($42.6M) commitment from the European Investment Fund's InvestEU program.
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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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