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| Here’s a look at today’s VC briefing. - 🌎 VC funding for Latin American startups slumped by 63% in 2023
- 🦄 Unicorn creation count slowed down in the U.S. in 2023
- 💰 Foundry’s current fund will be its last, said co-founder Seth Levine in a blog post.
Thank you. Karan
p/karan-chafekar | |
| 1 | | VCs invested $2.9B in Latin American startups in 2023, per Crunchbase. Funding for the region dropped 63% compared to 2022 and 84% compared to the record highs of 2021, making it one of the fastest shrinking regions for VC funding two years in a row. More: - Crunchbase believes the slump has nothing to do with the regional economic and political conditions.
- Instead, the slump can be attributed to the perceived issues in the region's economies and the global VC funding slump.
- Most of the largest funding rounds were inked by Brazilian startups.
- Tech-enabled credit provider QI Tech raised a $200M Series B round, and online real estate platform Loft secured $100M in fresh funding.
- Despite the dip, early-stage and seed-stage dealmaking showed some resilience.
- VCs invested $520M in early-stage startups in Q4 2023, more than double the $230M invested in later-stage companies in the same quarter.
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| 2 | | Only 45 startups bagged valuations of more than $1B and entered the unicorn club in 2023, per Pitchbook. 
What the numbers say: The unicorn creation count slowed by 87% compared to the 344 new unicorns minted in 2021. Most startups entering the unicorn club in 2023 belonged to the generative AI sector. New entrants to the list include defense tech startup Shield AI, large language model startup Adept, and deep-learning AI infrastructure platform Lambda. Relevance: Several AI startups received massive step-ups in their valuation in 2023, defying the global VC funding slump. Lambda's valuation jumped by about 812% from $170M in late 2022 to $1.55B in a span of 11 months. What happened: Due to the prolonged VC funding slump, several prominent startups risk losing their unicorn status. According to seed-stage-focused Cowboy Ventures' founder Aileen Lee, stakes of about 40% of U.S.-based unicorn tech startups are trading below the $1B valuation mark in the secondary markets. Lee added, "Given the chilly current M&A environment, founder resistance to recaps and investor fear of 'catching a falling knife' investing in a down round — we expect more abrupt shutdowns in 2024." Some startups may need to start considering raising down rounds or even a distressed sale. | | | |
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| 3 | | Last year, 205 companies debuted on India's two biggest stock exchanges, the Bombay Stock Exchange and the National Stock Exchange. The number of IPO market listings in India touched a five-year high. India had a strong number of public listings, while IPOs remained muted globally, especially in the U.S. and Europe. More: - Among the companies that debuted on Indian stock exchanges in 2023, 33 had been backed by private equity and venture capital firms.
- The privately backed companies collectively raised about $1.7B from the IPOs.
- The largest VC-backed company to hold an IPO listing was household consumer product company Cello, which raised $228M from its listing at a $1.7B valuation.
- Pitchbook expects IPO activity to remain strong in India this year, with several startups lining up their debuts for this year.
- Temasek and SoftBank-backed electric scooter manufacturer Ola Electric is looking to raise about $664M from its upcoming IPO listing.
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| 4 | | Foundry's co-founder and partner, Seth Levine, announced in a blog post that the firm's current Foundry 2022 fund will be its last, and it will not raise any subsequent funds. The firm didn't make the decision due to the ongoing market conditions. Instead, Levine said the firm had "intentionally decided not to build a legacy or generational firm" when it started out in 2006. More: - The Boulder, Colorado-based VC firm has backed nearly 200 early-stage startups and 50 VC funds to date.
- It currently has about 70 active investments, with the most notable being Havenly, SendGrid, JumpCloud, Fitbit, Seat Geek, and Spekit.
- Denver Business Journal estimates Foundry's assets under management to be about $4.29B.
- The firm will continue to invest through its $500M Foundry 2022 fund, mostly leading Series A and B rounds, at least until the next decade, per Levine.
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| 5 | | Canadian AI startup Cohere is looking to raise between $500M and $1B in fresh funding, sources informed Reuters. The startup intends to use the proceeds from the upcoming round to further develop its product, expand its team, and grow its sales activities. More: - The firm has raised $434M in total funding to date from Nvidia, Oracle, Salesforce Ventures, SentinelOne, Mirae Asset, Thomvest Ventures, Index Ventures, and other investors.
- Cohere had last raised a $270M Series C funding round at a $2.2B valuation in June 2023.
Zoom out: - The news of Cohere's fundraising comes amidst an investment frenzy for the AI sector, which bagged a third of the total funding invested in U.S. startups last year.
- AI startups raised $50B in VC funding in 2023, including eight rounds of more than $500M.
- Just last month, another AI startup, Anthropic, was in talks with investors to raise a $750M funding round, with Menlo Ventures potentially set to lead the round.
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| 6 | | Today's Funding: AI - AI voice cloning startup ElevenLabs cemented its unicorn status with a $80M Series B round co-led by Andreessen Horowitz, former GitHub CEO Nat Friedman, and Daniel Gross. The firm was valued at $1.1B at the funding round. Sequoia Capital, Smash Capital, SV Angel, BroadLight Capital, and Credo Ventures participated in the round.
Biotech - Precision oncology solutions biotech startup Certis Oncology Solutions raised $10M in Series C funding. Names of the investors were not disclosed.
Cleantech - Captura, a cleantech startup developing technology to capture CO2 from the ocean, extended its Series A round with an additional $21.5M provided by Maersk Growth, Eni Next, and EDP Ventures.
Transportation - Fully electric RV maker Lightship secured a $34M Series B round co-led by Obvious Ventures and Prelude Ventures. Allegis Capital, Congruent Ventures, HyperGuap, Alumni Ventures, and others backed the funding round.
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- U.S. investment firm Adams Street Partners has secured $478.6M worth of commitments towards its newest early-stage focused VC fund of funds, per SEC filing documents viewed by Deal Street Asia.
- Singaporean VC firm Clime Capital held the first close of its South East Asia Clean Energy Fund II at $127M. The fund aims to back early-stage renewable energy generation, energy efficiency, electric mobility, and electrical grid startups.
- Indian B2B harvest-to-retail marketplace Captain Fresh is in talks with Nekkanti Sea Foods, SBI Investment, Evolvence, Tiger Global, and Prosus Ventures to raise up to $50M in fresh funding. The firm was last valued at $500M when it raised a $100M round in March 2022.
- Standard Chartered's investment division, SC Ventures, is planning to set up an office in Abu Dhabi to take advantage of the blooming tech ecosystem in the UAE.
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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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