Venture funding dip in Asia levels off / Yale’s endowment posts 1.8% gain / Beyond Next Ventures raises $67.7M deeptech fund

Plus, former SoftBank exec Marcelo Claure acquires stake in EB Capital

Inside Venture Capital

For October 11, 2023

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Here are the latest stories:

Venture funding dip in Asia levels off as late-stage funding increases 51% YoY
Yale’s endowment posts a gain for the 14th consecutive year
Beyond Next Ventures raises $67.7M deeptech fund against a target of $168M

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Venture funding for Asian startups increased by 8% in Q3 compared to the previous quarter, per Crunchbase. The funding was just 8% lower than the same time last year, suggesting that the funding dip has leveled off in the region.

More:

Startups in the region secured $22.3B in Q3 2023, up from $20.6B in Q2.
- Asian startups bagged $24.4B VC funding in the same quarter last year.
The slight quarter-on-quarter increase in the funding was due to a slight bump in venture funding for late- and growth-stage startups.
Funding for late- and growth-stage startups increased 25% from $11.7B in Q2 to $14.6B in Q3.
- Q3's tally was 51% higher than the $9.6B raised by late- and growth-stage startups in Q3 2022.
Notable late- and growth-stage funding rounds that closed in the quarter include GTA Semiconductor's $1.9B, Runpeng Semiconductor's $1.7B, and EV startup Hozon's $961M funding rounds.
Early-stage startups were able to rake in $6.2B in VC funding, down 15% QoQ and 51% YoY.
Seed stage funding also witnessed a decline of 8% QoQ and 29% YoY, ending the recent quarter with $1.5B.
Deal values increased despite a 17% drop in deal count.

Q: Do you think Asia will emerge from the VC funding dip before North America and Europe? Join the conversation here.

Yale University's endowment has posted a 1.8% gain on investments in the fiscal year ending June.

What the numbers say: Yale University's endowment achieved a return of $759M in the 12-month period ending June. The endowment has posted gains for the 14th straight year. However, Yale had to allocate $1.8B to the university's operating budget, which reduced the endowment's total value to $40.7B.

What happened: Yale has invested across several asset classes, including public equities, leveraged buyouts, venture capital, and real assets. Typically, larger endowments prefer to invest in VC and hedge funds, while the smaller endowments favor public equities more. While Yale posted gains, its peers Duke University and the Massachusetts Institute of Technology have posted investment losses of 1% and 2.9%, respectively.

Where to see the impact: Yale was able to post gains of less than 1% last year, making it the only one of the Ivy League colleges to do so. The gains in 2022 were modest compared to the 40% gains recorded by Yale in 2021, which made it the best year on record since the 1980s. However, fortunes reversed the next year as global nations faced economic instability. Endowments posted median losses of 10.2% in 2022, making it the biggest decline since 2009.

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Japanese early-stage VC firm Beyond Next Ventures secured $67.7M (~10B yen) in capital commitments toward its third fund. The firm expects to reach its fund target of $168M (25B yen) by March 2024. The firm aims to invest in around 25 deeptech startups across sectors like robotics and biotechnology.

More:

The firm will write checks ranging from $670,000 to $2M.
Beyond Next Ventures is willing to invest up to $13M in promising startups across multiple rounds.
The firm will invest across seed, Series A, and later-stage rounds.
With the new fund, Beyond Next will have more than $316M worth of assets under management.
MUFG Bank, Dai-ichi Life Holdings, Tokyo Century, SMBC Nikko Securities, Mitsubishi UFJ Trust, and FFG Venture Business Partners contributed to the new fund as limited partners.
Beyond Next has backed 80 healthcare, agri-food, and deeptech startups across Japan and India, the most notable of which are CureApp, Susmed, Elephantech, and iCare.

Zoom out:

Due to the relatively smaller venture capital market in Japan and the new institutional investors in the space, VC firms typically focus on seed and early-stage startups in the nation.
As a result, there is a funding deficit for late-stage Japanese startups.

Former SoftBank Group executive Marcelo Claure acquired a "significant" stake in Brazilian investment firm EB Capital. Claure did not reveal the amount invested or the percentage stake acquired by him. EB Capital announced that Claure will take up the roles of partner and vice chairman of the firm.

More:

EB Capital, which has $987M (5B reais) worth of assets under management, has invested in healthcare, education, green energy, and telecommunications companies.
Claure said, "Brazil's emerging as potentially the green power in the entire world."
He added, "And I found in EB Capital what I like to call an emerging platform — one that is fast-growing and, more importantly, one that shares the same vision that I have for the country."

Zoom out:

Claure's family office has $4B of assets under management.
Earlier this year, Claure launched a new venture capital firm called Bicycle Capital with former SoftBank colleague Mwashuma "Shu" Nyatta.
The firm secured $440M in capital commitments toward its debut fund.

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Abu Dhabi's sovereign wealth fund Mubadala Capital closed its second Brazil-specific fund at $710M, more than double its predecessor. The news of the new fund comes as the firm pledged to invest $1B every year in the nation. The firm is bullish about Brazil's growth prospects under President Luiz Inacio Lula da Silva.

More:

Oscar Fahlgren, the head of Mubadala Capital in Brazil, said the firm has already invested more than $5B in the nation.
The firm will raise a larger dedicated fund in 2024, said Fahlgren.
Mubadala, which has over $20B in assets under management, intends to scoop up distressed assets at attractive valuations.
Fahlgren believes that the scale and potential of returns in Brazil make it the most attractive investment opportunity in South America.
"GDP is growing more than expected, and we've seen political stability since the new administration took over," said Fahlgreen.

Today's Funding:

Biotech

Agomab Therapeutics, a biotech startup developing novel treatments to resolve fibrosis, repair tissue structure, and restore organ function, closed its Series C funding round at $100M. Fidelity Management & Research Company led the round with participation from EQT Life Sciences, Canaan, Dawn Biopharma, KKR, and others.

Data

Automated data curation solution Cleanlab bagged $25M in Series A funding co-led by Menlo Ventures and TQ Ventures.

Deeptech

Orbem, a deeptech German startup that uses AI-powered MRI technology to scan biological samples, raised €30M ($31.8M) in Series A funding led by 83 North.

Fashion

D2C eyewear brand Pair Eyewear secured $75M in fresh funding to pursue international expansion. The Series C round was led by Prysm Capital and supported by existing investors New Enterprise Associates and Javelin Venture Partners.

Fintech

German digital wealth fintech startup Upvest secured $31.8M (€30M) in fresh funding from BlackRock, Bessemer Venture Partners, HV Capital, Earlybird, Notion, ABN Amro Ventures, and 10x Capital.

Insurtech

Indian insurance policy aggregator InsuranceDekho raised $60M in Series B funding from Mitsubishi UFJ Financial Group, BNP Paribas, Eurazeo, and Beams Fintech Fund.

Salestech

AI-powered salestech platform Conveyor raised a $12.5M Series A round led by Cervin Ventures.

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German luxury footwear company Birkenstock raised $1.48B at its IPO debut on the NYSE. Shares were priced at $46 a piece, giving the firm a valuation of $9.3B.
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