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| Here's a look at today's VC briefing. - Chinese president attempts to lure American investors
- Coatue slashes fund management fees for its new $1.4B companion fund
- Former VC Mike Rothenberg found guilty on 21 counts of defrauding investors
We have also rounded up the top late-stage funding rounds of this week. Thank you. Karan
p/karan-chafekar | |
| 1 | | Chinese President Xi Jinping is attempting to lure American investors in his first trip to the U.S. in six years. Xi's trip comes amidst a background of dwindling U.S. investment in China. More: - China's regulatory crackdown and rising tensions with the U.S. caused an estimated $1T loss for tech companies.
- U.S. limited partners lowered their commitments to Chinese funds and startups by 74.4% from 2019 to 2020.
- From 2018 to 2022, U.S. LPs have lowered their commitments by 64.8% and 56.5% in VC and PE funds in China and Hong Kong, respectively.
- Earlier this August, the Biden administration restricted U.S. PE and VC funding in Chinese AI, quantum computing, and semiconductor companies.
- As a result, several public pension plans, including the Teacher Retirement System of Texas and Florida's public employee pension, opted to reduce their investment in Chinese companies.
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| 2 | | VCs deployed $1.1B in late-stage and beyond global startups this week between Nov. 11 and Nov. 17, per Crunchbase data. Energy startups raked in 25% of the funding this week. 3D printing, AI, and fashion startups nabbed 21%, 14%, and 13% of the financing, respectively. 
Here are the top five largest rounds announced this week: - Chinese solar energy firm Huasun Energy raised $276.3M (2B yuan) in fresh funding. China Green Development Investment Group led the Series C round.
- Generative AI and 3D printing-powered digital manufacturing system provider Divergent Technologies secured $230M in Series D funding. Hexagon AB led the round, contributing $100M of the total.
- British fashion brand Urbanic bagged $150M in Series C funding from Mirabaud Lifestyle Impact & Innovation Fund, D1 Capital Partners, Jam Fund, and other investors.
- Cryptocurrency exchange and wallet services provider Blockchain.com closed its Series E funding round at $110M. The firm's valuation plunged by more than half compared to its previous $14B valuation from 2022. Kingsway Capital led the round, joined by Baillie Gifford, Lakestar, Lightspeed Venture Partners, and Coinbase Ventures.
- Cytovale, a startup working on diagnostics for detecting early cases of sepsis, secured $84M in Series C funding led by Norwest Venture Partners. Sands Capital and Global Health Investment Corporation joined the funding round.
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| 3 | | Coatue Management has reportedly raised a $1.4B companion fund, sources informed The Information. The firm will not charge limited partners the typical 2% fund management fee. Per The Information, the firm may have slashed the fund management fee to entice investors to provide capital to the fund amidst a backdrop of VC fundraising headwinds. More: - The new fund will be a companion fund to the $7.7B growth equity fund, Coatue Growth Fund V.
- News of the new fund comes as the firm recently reported a 30% paper loss on the previous fund, marking down the fund to 0.71, net of fees, as of Sept. 30.
- Coatue's growth fund has lost its valuation due to the markdowns on valuations of portfolio startups.
- The firm marked down the value of its stake in MoonPay, OpenSea, Calendly, and Notion by 90%, 90%, 70%, and 40%, respectively.
- Meanwhile, it raised the valuation of enterprise software provider OneTrust by 50%.
- Coatue still has $1.8B in dry powder available for new investments from its growth fund.
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| 4 | | An Oakland, California, jury found former venture capitalist Mike Rothenberg guilty of 21 counts of defrauding investors. The charges include bank fraud, falsifying statements, four counts of money laundering, and 15 counts of wire fraud. More: - Rothenberg will be sentenced on March 1, 2024.
- Each wire fraud charge carries "maximum statutory penalties of up to 20 years in prison, not more than three years supervised release, and a $250,000 fine," per a DOJ statement.
- Rothenberg's venture firm began spiraling in 2016 after a report uncovered his misuse of funds and internal disarray.
- The SEC charged Rothenberg for overcharging investors in 2018.
- Rothenberg paid "tens of millions of dollars" in disgorgement penalties as a settlement in 2019.
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| 5 | | Menlo Ventures has secured capital commitments worth $1.35B from investors "to support the forthcoming generation of AI startups." 80% of the capital will be invested in AI companies, said partner Matt Murphy. $550M of the capital is earmarked for its flagship early-stage fund, Menlo XVI, with the remaining $800M set aside for its growth fund, Inflection III. More: - Menlo XVI will invest in startups with zero to $3M in annual recurring revenue, while Inflection III will back startups that have between $3M and $10M ARR.
- Both funds are larger than their predecessors.
- Notable AI startups in its portfolio include Anthropic, Typeface, Pinecone, and Cleanlab.
Zoom out: - Including the new fund, the firm has raised $3.8B in capital from investors across eight funds and has $5.6B worth of assets under management.
- In addition, the firm has also distributed $5.2B capital to LPs after successfully exiting 80 companies, 15 of which went public.
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| 6 | | Today's Funding: Biotech - RA Capital Management led a $47.5M in Series B in biotech startup Nature's Toolbox.
Climate tech - Canadian carbon capture tech startup Deep Sky Corp. raised $55M (CA$77M) in Series A funding co-led by Whitecap Venture Partners and BrightSpark Ventures.
Enterprise software - Ingenious.Build, a firm developing project management software for real estate and construction sectors, closed its Series A round at $37M. Morpheus Ventures and Navitas Capital co-led the round, joined by Koch Real Estate Investments, JLL Spark Global Ventures, and American Family Ventures.
- Workplace inclusion platform Inclusively raised $13M in Series A funding led by Firework Ventures.
Semiconductor - Chinese chip design startup Moore Threads has reportedly raised ~$138.5M (1B yuan) in Series B+ funding at a post-money valuation of $3.4B (24.8B yuan), sources informed Reuters.
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| 7 | | Quick Hits: - The Kubernetes Cookbook is your comprehensive companion, equipping you with the knowledge and techniques to harness the full potential of Kubernetes.*
- SoftBank is planning on liquidating a portion of its 14% stake in Indian logistics startup Delhivery. The firm is reportedly planning to sell off a 4% stake worth $150M.
- Latin American ride-hailing platform InDrive launched a new venture and M&A division called New Ventures. The firm armed it with $100M to invest in startups within emerging markets.
- San Francisco-based Red Tree Venture Capital is expanding to San Diego to tap into more biotech startups. The firm hired former Versant Ventures and Third Rock Ventures executive Jeremy Caldwell as a partner.
- VC firm Traction Capital acquired Nu-Star, the parent company of PowerPusher, for an undisclosed sum.
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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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