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| Here’s your daily Startups briefing: - 🤝 Multiverse acquired Searchlight to expand training services for professional environments
- 🛫 Seed startups are using extension and bridge rounds to extend cash runways
- 🛴 Lime plans to invest $55M to expand fleet, re-enter Greece and Mexico
Thank you. Karan
p/karan-chafekar | |
| 1 | | Apprenticeship program startup Multiverse acquired AI-based recruitment and assessment startup Searchlight for an undisclosed sum. The acquisition will help Multiverse expand its training services for professional environments. More: - Multiverse's founder and CEO, Euan Blair, said, "Searchlight's AI, platform, and exceptional talent will allow us to better diagnose the skills needed within companies and deliver impactful solutions."
- The U.K. edtech unicorn touched a post-money valuation of $1.7B in June 2022 when it raised a $220M Series D round co-led by StepStone Group, Lightspeed Venture Partners, and General Catalyst.
- Searchlight's co-founders Kerry and Anna Wang will become the director of product and head of AI at Multiverse, respectively.
Zoom out: - This is Multiverse's second acquisition following the purchase of Eduflow in May 2023.
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| 2 | | Seed-stage startups are raising extensions and bridge rounds to extend their cash runway, per a new report from Carta. 
What happened: Earlier in 2023, several startups opted for down rounds as VC dealmaking slowed. More than 19% of the rounds completed on the Carta platform in 2023 were down rounds. Towards the end of the year, seed-stage startups started opting for extension and bridge rounds to avoid valuation markdowns that come with down rounds. Startups are also structuring the rounds as SAFE to postpone the valuation repricing until a later date. What the numbers say: 45% of all Series A rounds that closed in Q4 2023 on the Carta platform were bridge rounds, the highest for any stage in any quarter so far this decade. Relevance: Investors and startup founders typically avoid bridge rounds and extensions. However, they have changed their attitude towards such rounds during the ongoing VC funding slump. The main aim of startups is to extend their runway as much as possible to survive the economic slump. | | | |
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| 3 | | Cybersecurity unicorn startup Claroty is gearing up for an IPO listing in the U.S. The firm has met with potential underwriters to help with the offering. The firm plans to go public at the start of 2025 at a valuation of $3.5B. More: - To date, Claroty has raised $735M from investors, including a $400M funding round in 2021 led by SoftBank.
- Investors participating in the round include Bessemer Venture Partners, NightDragon, Warburg Pincus, Siemens, Schneider Electric, Rockwell, LG, General Motors, and BMW.
- Claroty used the proceeds of the funding round in 2021 to acquire medical devices firm Medigate.
- A month ago, the Israeli startup touched a valuation of $2.5B when it raised $100M in equity funding.
- Claroty crossed the $100M mark in annual recurring revenue and has seen a customer growth rate of 300%.
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| 4 | | Shared electric bike and scooter network Lime aims to add more than 30,000 new bikes to its fleet and re-enter Greece and Mexico markets. The Uber-backed startup will spend about $55M on the fleet expansion. The new bikes will be added across North America, Europe, and Australia. More: - In 2023, Lime reported a 32% surge in gross bookings, ending the year at $616M.
- Its adjusted earnings before interest, taxes, depreciation, and amortization surpassed the $90M mark, increasing 500% compared to the previous year.
- The firm has a fleet of about 200,000 bikes and scooters.
Zoom out: - Lime's expansion comes as competitors struggle to stay afloat.
- Last year, Bird Global went bankrupt, Superpedestrian shut down U.S. operations, and Lyft was planning to offload Citi Bike to a strategic partner.
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| 5 | | EV leasing startup Zevvy has shut down due to volatile market conditions. The shutdown can be attributed to the rising interest rates, slowing EV sales, and slumping resale values of EVs. In the LinkedIn post announcing the decision, CEO Andrew Krulewitz wrote, "Good ideas don't always make for good startups." More: - Krulewitz co-founded Zevvy along with Alex Shulman, Miranda Spradlin, and James Greff in 2021.
- Zevvy catered primarily to gig workers, giving them cheaper monthly lease terms than Uber and Lyft.
- The startup also offered users the option to buy the car eventually.
- The startup stopped all leasing operations at the end of 2023 and officially shut down at the start of 2024.
- Zevvy's vehicle assets were liquidated in a sale, while other assets were assigned to a senior secured creditor.
- The startup had raised $2.4M in equity funding and $3M in debt from BoxGroup, MaC Venture Capital, Mission One Capital, MobilityFund, Alumni Ventures, Climate Capital, I2BF Global Ventures, Natural Bridge Ventures, and Pareto Holdings.
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| 6 | | Indian quick-commerce startup Zepto crossed the $1B mark in annual sales, per existing investor Goldman Sachs. The company achieved the milestone in just 29 months since its inception. Zepto is close to bagging the second-highest market share of the quick-commerce market in India, which is currently dominated by Zomato-owned Blinkit and SoftBank-backed Swiggy Instamart. More: - Zepto cemented its unicorn status last year.
- Notable backers of the firm include YC Continuity, StepStone Group, Glade Brook Capital, and Contrary.
- The startup has a network of over 300 dark stores in seven Indian cities to facilitate quick delivery of items to customers within 10 minutes.
- Zepto expects to break even at the EBITDA level in the next quarter.
- "The company expects a steady state contribution margin of 12%, with steady-state EBITDA margin of 7%," Zepto said in a statement.
Zoom out: - According to TechCrunch, India's quick-commerce sector has grown to $5B.
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| 7 | | Quick Hits: - When it's time to grow your company, make Ohio your competitive advantage with better sites, sharper talent, earlier funding, and less red tape.*
- Fulfillment services provider Stord acquired third-party logistics services startup ProPack for an undisclosed sum. The move will help Stord expand its fulfillment network across the U.S. and Canada.
- Social media manager Hootsuite acquired consumer intelligence and deep listening tech firm Talkwalker. Financial details of the transaction were not disclosed.
- Healthtech startup Neurovalens' second head-mounted noninvasive electrical stimulation device to treat generalized anxiety disorder received clearance from the FDA last week.
- Digital payment solutions provider Hokodo availed a €100M ($108.6M) debt facility from Viola Credit.
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Karan Chafekar | |
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