Venture capital – Marianne Bluger http://mariannebluger.com/ Tue, 27 Sep 2022 18:24:29 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://mariannebluger.com/wp-content/uploads/2021/10/favicon-2-120x120.png Venture capital – Marianne Bluger http://mariannebluger.com/ 32 32 Why 9 Innovators Just Got Venture Capital Rounds https://mariannebluger.com/why-9-innovators-just-got-venture-capital-rounds/ Mon, 26 Sep 2022 15:30:00 +0000 https://mariannebluger.com/why-9-innovators-just-got-venture-capital-rounds/ The Sturm und Drang that dominates many conversations about the economy at the end of 2022 may give the impression that difficult times are dampening the spirit of innovation, especially in the technology industry. Nothing could be further from the truth. There is still a healthy flow of venture capital investment into startups, based on […]]]>

The Sturm und Drang that dominates many conversations about the economy at the end of 2022 may give the impression that difficult times are dampening the spirit of innovation, especially in the technology industry.

Nothing could be further from the truth. There is still a healthy flow of venture capital investment into startups, based on innovative ideas coming from those startups.

For readers of Acceleration Economy, it’s essential to understand where innovation is happening, where the venture capital community is placing its bets, and which companies have strong potential to help you reinvent your business to dazzle customers.

In this second monthly report, I review nine timely investment rounds, the technology that’s appealing to investors, and the plans these companies hope will help them win customers. Some infusions place startups in or near this rarefied unicorn class of $1 billion valuations. There are also smaller rounds aimed at companies tackling a diverse set of business challenges.

Fast: retail technology that builds loyalty

Based in Seattle Rapidly secured $100 million in a round led by BRV Capital Management, bringing total funding to $210 million and its valuation to over $1 billion. Swiftly’s omnichannel retail technology is designed for physical stores to build strong digital relationships with customers. Clients include Family Dollar.

Swiftly says its tools give customers a more personalized and connected shopping experience, along with exclusive personalized discounts and simple mobile payment. Swiftly also offers a retail media network so customers can develop advertising revenue streams.

“Our mission is to enable brick-and-mortar retailers to move from analog to algorithmic, as the winners of this new era of commerce will be determined by how quickly they can reinvent their business to capture shoppers digitally and monetize those digital relationships” , said Henry Kim, co-founder and CEO of Swiftly, in announcing the funding round.

Datamaran: ESG risk management

Developer of ESG risk management software platform, Datamaran secured around $13.3m (£11.7m) led by two clients who were listed companies: Fortive and American Electric Power.

The Datamaran platform provides factual information and near real-time assessment of ESG risks that can be tailored to a client’s industry, geography or stakeholder context.

Datamaran identifies and monitors over 400 external risk factors – including environmental, social and corporate governance (ESG) issues, innovation and technology, and geopolitical issues – through continuous analysis of regulatory environments, media and corporate disclosure. The company says the C-suite audience now accounts for over 40% of revenue and continues to grow rapidly.

TrueFoundry: democratizing AI

There is no shortage of companies or research pointing to the need to democratize AI in order to improve the success rate of AI projects. TrueFoundryfounded by Facebook alumni, raised a $2.3 million funding round led by Sequoia India and Surge in Southeast Asia to support its mission to democratize AI.

Business leaders say nearly 90% of machine learning (ML) models don’t end up in production and 50% fail. While large companies can deploy large teams to overcome such outcomes, small companies cannot.

“TrueFoundry was born from the idea that no company, large or small, should miss the opportunities of machine learning. With our automated platform, data scientists and engineers are able to deploy models machine learning at the speed and maturity of big tech, reducing their lead times from weeks to hours,” they said in a blog post announcing their funding.

Skitty: Collaboration + Avatars and Metavers

Place, which has developed an avatar-based Metaverse experience as well as team chat and video conferencing tools to improve the employee experience and productivity, has secured $5.5 million in seed funding led by Freestyle. The company positions its software as a more complete platform than Slack or Teams.

Customers communicate within its platform using virtual avatars in a branded desktop environment. Organizations can create their own customizable virtual workspace that reflects company branding and culture. Team members can host meetings, share screens, collaborate instantly, or start a conversation simply by interacting with avatars in the space.

TractionAg: better farm management

An Indianapolis-based developer of cloud-based farm management software that manages accounting and operations, TractionAg raised $3 million in seed funding. The Indianapolis startup plays in the same market we recently profiled, Cropin, which introduced industry cloud software Cropin Cloud for agriculture, though the latter’s products and ambitions are broader. – suitable for a company that has existed for more than 10 years.

TractionAg offers a suite of farm-specific features, including accounting, operations, and a fully digital payroll system that automatically files and pays producer federal and state payroll taxes. The company claims that 60% of farmers use accounting systems that are not specific to agriculture and therefore lack information on farm management.

The muse: job search and career development

The New York-based company start said it received $8 million in new investments led by MBM Capital.

The company says its platform is already used by 75 million people every year, with a high concentration among Gen Z and millennial job seekers. It’s also used by 10% of Fortune 500 companies seeking to attract and hire the best talent. The company claims that candidates applying through its platform are three times more likely to be hired than candidates applying through other platforms.

With additional resources, the company said it plans to seek out and acquire other quality brands that appeal to high-demand job seekers.

Afresh: AI for healthy and profitable products

Based in San Francisco Again develops AI-based software that tracks demand and manages fresh produce orders in grocery stores. The company secured $115 million in a round led by Spark Capital, bringing total funding to $148 million.

The company seeks to have a social impact by eliminating the waste of fresh food; he cites studies indicating that 40% of all food in the United States is thrown away.

According to Afresh, customers (including Albertsons and SaveMart) are reducing food waste by 25% and seeing a 2-4% increase in revenue and a 40% increase in operating margin for their products.

“Food, more than anything else, shapes the health of people and our planet. We founded Afresh with the goal of eliminating food waste and making nutritious food more accessible,” said CEO and co-founder Matthew Schwartz, noting that the company aims to serve thousands more stores across the United States and in Europe, and expand to support new fresh produce categories. like meat and bakery.

Pie Insurance: disruptive for small businesses

A Denver-based small business workers’ compensation technology provider Pie insurance raised a $315 million investment round led by Centerbridge Partners and Allianz X. This round brings total capital raised to over $615 million. The company says it is disrupting a fragmented market by more accurately pricing and underwriting insurance risk.

The company intends to invest more in innovating its proprietary pricing algorithms, as well as delivering experiences directly to small businesses and the agent partners who serve them.

OpenStore: buy Shopify merchants

Open Store, a year-long venture that acquires Shopify businesses to enable entrepreneurs to make quick exits, closed at $32 million in a funding round led by Lux Capital that values ​​OpenStore at $970 million. Total equity financing now exceeds $150 million

Over the past 18 months, OpenStore has acquired dozens of companies generating tens of millions in revenue. It represents a pathway to liquidity for traders.


For more exclusive coverage of innovative cloud companies, check out Cloud Wars Horizon here:

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Like Venture Capital Firms Only Better: 3 BDCs for Dividend Investors https://mariannebluger.com/like-venture-capital-firms-only-better-3-bdcs-for-dividend-investors/ Sat, 24 Sep 2022 16:45:00 +0000 https://mariannebluger.com/like-venture-capital-firms-only-better-3-bdcs-for-dividend-investors/ business development companies, or BDC, are similar to private equity firms, but with a distinct advantage for investors. These closed-end investment companies typically make debt or equity investments in small private companies that cannot easily access financing. But BDCs tend to rely more on debt investments to generate interest income, which is then widely distributed […]]]>

business development companies, or BDC, are similar to private equity firms, but with a distinct advantage for investors. These closed-end investment companies typically make debt or equity investments in small private companies that cannot easily access financing. But BDCs tend to rely more on debt investments to generate interest income, which is then widely distributed to shareholders in the form of dividends.

As a bonus, they typically offer high dividend yields – with some offering double-digit yields and most around at least 5%. Risks come with these returns, but we’ll highlight three BDCs we like today for their high current returns.

Drive to Main Street (Capital)

Founded in 2007, Main Street Capital (MAIN) is a BDC that specializes in equity investing in lower middle market companies. Main Street does recapitalizations, management buyouts, refinances, family estate planning, and more. It also provides loan capital to target companies to grow through acquisitions or investments in the business. Main Street is active in a wide variety of industries, preferring diversification to specialization.

Main Street generates approximately $340 million in annual revenue and trades today with a market capitalization of $2.9 billion.

Like most BDCs, Main Street’s dividend per share has been volatile. This is because BDCs are required to pay out nearly all of their profits as dividends to shareholders, so when profits decline from year to year, the dividend generally follows suit. However, over the past 10 years, eight of them have produced higher dividends year over year. So while the company’s current dividend streak is only two years, it has a strong track record.

We see the benefit of the current annual payment of $2.64 – which is paid monthly – as limited. However, the current payout ratio of 88% is actually lower than it has been at any time in the past decade, so Main Street’s dividend safety has improved significantly. Above all, we think today’s dividend is very sustainable.

The current yield is 6.8%, more than four times that of the S&P 500. Given the combination of outstanding yield and payment security, we believe Main Street is an income stock today. very solid.

Horizon Technology Finance (HRZN), which is a BDC specializing in lending and investing in early-stage companies in the technology, life sciences, healthcare and cleantech sectors. Unlike Main Street, which seeks high levels of diversification, Horizon deliberately chooses specialization, believing that the industries mentioned offer superior returns over time, particularly through capital appreciation.

The company was founded in 2008, generates approximately $70 million in annual revenue, and trades today with a market capitalization of $281 million.

Horizon’s dividend for this year is expected to be slightly lower than last year, so its streak of dividend increases is zero. But while there have been cuts to the company’s payouts over the past decade, the current dividend of $1.20 per share per year – paid in monthly installments – is only 15 cents lower. to what it was 10 years ago. While we obviously prefer rising dividends, Horizon makes up for this lack of dividend growth with its massive current yield of 10.8%. That’s more than six times that of the S&P 500, so on a pure income basis, Horizon is terrific.

The payout ratio is 89% for this year, so despite the massive yield, we think the dividend looks pretty safe at the moment. BDCs still have high payout ratios, and Horizon has paid out more than 100% of its earnings in recent years, but has reduced its payouts to the point where it is no longer necessary.

We currently expect the dividend to remain at $1.20 per share per year for the foreseeable future as management is likely keen to avoid another cut down the road.

TriplePoint Venture Growth

Our latest stock is TriplePoint Venture Growth (TPVG), a BDC that invests in growth-stage venture-backed companies. It also provides debt financing to venture capital growth companies in various ways. Like Horizon, TriplePoint is focused rather than diversified. TriplePoint primarily invests in e-commerce, entertainment, technology and life science companies. This includes software companies, networking and communication companies, biotechnology, surgical and health services, etc.

The company was founded in 2013, generates approximately $110 million in annual revenue, and trades with a market capitalization of $415 million.

TriplePoint began paying dividends to shareholders in 2014 and since then has never reduced its payouts. This is unusual for a BDC – in a good way – in that TriplePoint has managed to sustain its earnings enough to keep dividends paid to shareholders at a rate of $1.44 per share per year. Unlike the first two stocks on our list, TriplePoint pays its dividend on a typical quarterly basis, rather than monthly.

TriplePoint’s payout ratio has generally been below 100% during its time as a public company, and it is 90% today. Given that we expect modest earnings growth in the coming years, but a payout that is expected to remain stable, the payout ratio and dividend safety should improve over time. At this point, we have no concerns about the safety of dividends, barring a massive contraction in earnings.

TriplePoint also stands out among the crowd on the basis of yield, offering a colossal current dividend yield of 12.1% based on share price declines so far this year. This sets the company apart from almost any other stock on the market today, and especially from stocks for which we consider the dividend safe.

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The Case for US Venture Capital’s Outperformance • TechCrunch https://mariannebluger.com/the-case-for-us-venture-capitals-outperformance-techcrunch/ Fri, 23 Sep 2022 17:00:24 +0000 https://mariannebluger.com/the-case-for-us-venture-capitals-outperformance-techcrunch/ Jean Zic is a partner and founding member of the EQUIAM team. He spends most of his time struggling with fragmented and imperfect private market data in a never-ending effort to derive market-beating investment signals. Shahi Shah is director of commercial operations at EQUIAM. She is passionate about leading the design, implementation and oversight of […]]]>

We have seen widespread losses in global equity markets this year. After a decade on the rise, many venture capital funds have found themselves holding overvalued stocks of companies whose IPO prospects have either been eliminated or significantly delayed.

Markets have now become capricious, as evidenced by the widespread correlation between asset classes. There are certainly structural factors sowing the seeds of pessimism such as high inflation; a hawkish US Federal Reserve leading a global trend of higher interest rates; an evolving European energy crisis; the first land war in Europe in 70 years; various supply chain disruptions; an ongoing global pandemic; rising global trade tensions and, to top it off, a slowly collapsing Chinese credit bubble.

Although public markets have priced in some of these headwinds, their severity and duration remain uncertain. Turning to the US tech sector, the Nasdaq Composite Index is down sharply year-to-date, price-earnings ratios are at six-year lows, and venture capital funding has slowed significantly. Large-cap public tech revenues and earnings have generally held up well so far, but are expected to weaken in the coming quarters due to Fed-induced demand destruction.

Despite all of these current and high-profile pressures, we believe the narrative of the technology and innovation supercycle remains unchanged and many companies are primed for growth. Private tech companies are refocusing on fundamentals and valuations are returning to reasonable levels.

We also believe that current economic conditions create a unique opportunity for venture capital funds holding dry powder to achieve significant returns, as was the case for VCs that deployed during the period 2010-2014.

Although the Fed prevented the natural three-year transition period between the reversal in yields and the golden period, we still believe that the 2023/2024 vintages will indeed achieve golden period status.

A sound investment process analyzes both macroeconomic trends and fundamental data to assess the likelihood of various potential outcomes. We have identified two distinct potential outcomes for the US private tech sector over the next 6-12 months.

Scenario 1: additional pain before recovery

A few weeks ago, Federal Reserve Chairman Jerome Powell predicted that the Federal Reserve’s efforts to contain inflation would lead to a “prolonged period of below-trend growth” that “would cause suffering for households and businesses”.

This implies a period of stagnation in US stock prices in a lower range over the next 12 to 24 months. Such an outcome is likely in the short term if the following negative economic and geopolitical developments were to occur:

Aggressive Federal Reserve

An overly hawkish Federal Reserve in the face of deteriorating economic conditions in the United States could trigger stock market stagnation and potentially lead to another 20-25% decline in public stock prices. Such circumstances would continue to suppress price/earnings multiples and negatively impact sales performance.

While parts of the economy remain strong, it now seems clear that Fed Chairman Powell is having a Paul Volker moment: a resolute aim to break the back of inflation, whatever the consequences. Orchestrating a “soft” landing was a “hopeful” strategy that is proving increasingly elusive.

Assuming we see further interest rate hikes in the short to medium term, the prospect of long-term profitability for the US tech sector, perhaps counterintuitively, remains strong. A suppressed market would likely lead to above-average returns for the tech sector (particularly SaaS and cloud-enabled businesses) due to its ability to scale quickly without the additional infrastructure and blockchain ramp-ups. supply that will be required by the traditional brick. and mortar companies.

Rising geopolitical tensions around Ukraine

It has been more than six months since Russia invaded Ukraine, and the economic impact of rising commodity prices is beginning to be felt across Europe. While it is too early to predict the military outcome of the conflict, it is clear that Europe and the United States are morally and financially invested in preventing Russia from successfully annexing parts of Ukraine.

Current circumstances suggest a stalemate as the best-case scenario. The conflict in Ukraine resembles the Soviet-Afghan War of the 1980s, a protracted war of attrition in which the West funds, trains and arms local fighters in an effort to stress the Russian economy and thus force a withdrawal of the region. A threatened and cornered Russia could resort to ultimate tantrums, either by including nuclear threats or by restricting/eliminating Europe’s access to its energy and raw material resources.

Rise in geopolitical tensions around Taiwan

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Capital Factory hosts Fed Supernova, connecting top venture capital and military procurement experts with startup entrepreneurs https://mariannebluger.com/capital-factory-hosts-fed-supernova-connecting-top-venture-capital-and-military-procurement-experts-with-startup-entrepreneurs/ Wed, 21 Sep 2022 14:11:00 +0000 https://mariannebluger.com/capital-factory-hosts-fed-supernova-connecting-top-venture-capital-and-military-procurement-experts-with-startup-entrepreneurs/ AUSTIN, Texas–(BUSINESS WIRE)–Texas’ leading innovation and mentorship center for tech entrepreneurs, Capital Factory, will host Fed Supernova, Presented by IBM, September 27-29, 2022. The gathering targets industry, academia, military, venture capitalists, startups and acquisition experts for a premier event designed to enable global defense decision makers to bridge the gap between commercial technology and defense […]]]>

AUSTIN, Texas–(BUSINESS WIRE)–Texas’ leading innovation and mentorship center for tech entrepreneurs, Capital Factory, will host Fed Supernova, Presented by IBM, September 27-29, 2022.

The gathering targets industry, academia, military, venture capitalists, startups and acquisition experts for a premier event designed to enable global defense decision makers to bridge the gap between commercial technology and defense requirements.

Last year, Fed Supernova hosted more than 140 speakers and 2,000 registrants, all focused on bringing new technologies to the Department of Defense as well as the defense of partner nations.

“The Capital Factory Defense Innovation Center is the only location in the country where multiple Defense Innovation Units from different forces and agencies all work together in the same physical space,” said Joshua Baer, founder and managing director of Capital Factory. “Fed Supernova is our biggest event of the year where we help entrepreneurs connect to the investors, customers and talent they need to excel while driving innovation in the defense industry.”

This year’s event – like those that have gone before – will focus on how startups can traverse the “Valley of Death”, while demonstrating market trends in the space, the development of software and artificial intelligence, among others.

IBM, DuploCloud, Raytheon Technologies and Second Front Systems, together with other event partners, will be present for more than 60 sessions and panels designed to educate, inform and expose entrepreneurs, industry and government decision makers on the latest in the industry. trends across technology and multinational defense.

Scheduled speakers include:

  • Mr. Young Bang, Principal Deputy Assistant Secretary of the Army (Acquisition, Logistics and Technology)

  • Lieutenant General Thomas Todd, Deputy Commanding General, Acquisition and Systems Management, United States Army Futures Command

  • Major General Alice W. Treviño, Deputy Assistant Secretary for Contracts, Office of the Air Force Assistant Secretary for Acquisition, Technology, and Logistics

  • Ms. ShaChelle Manning, Chief Commercial Strategy Officer, Defense Advanced Research Projects Agency

  • Mr. Steven “Bucky” Butow, Director, Space Portfolio, Defense Innovation Unit

  • Col Martin Salinas, Chief Operating Officer, AFWERX

“This is a unique opportunity to hear from the highest levels of the Department of Defense and learn about the challenges, priorities and funding opportunities that will allow us to work together to ensure our national security. collective,” Butow said.

Anyone interested in defense innovation can register for Supernova Fed to access briefings from the US Air Force, US Army, US Navy, National Geospatial-Intelligence Agency (NGA), and more. The three-day conference helps cultivate and propel government modernization by creating a rare opportunity for the entire ecosystem to converge in the same place, at the same time, and with a common goal.

Additional information and the link to register for Fed Supernova are available at www.fedsupernova.com.

About Capital Factory

Capital Factory is the center of gravity for entrepreneurs in Texas, the number one state for startups in the United States. Thousands of entrepreneurs, programmers and designers gather day and night, in person and online for meetings, courses and coworking. With boots on the ground in Austin, Dallas, Houston and San Antonio, we meet the best entrepreneurs in Texas and introduce them to investors, employees, mentors and clients. According to Pitchbook, Capital Factory has been the most active seed investor in Texas since 2010. Visit capitalfactory.com.

About Fed Supernova

Fed Supernova is an annual event, hosted by Capital Factory, where defense priorities and tech trends collide for good. The conference is being held in person in Austin. Learn more about this force multiplier for defense innovation at www.fedsupernova.com.

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Lower venture capital investments in the biomedical sector https://mariannebluger.com/lower-venture-capital-investments-in-the-biomedical-sector/ Tue, 20 Sep 2022 06:32:36 +0000 https://mariannebluger.com/lower-venture-capital-investments-in-the-biomedical-sector/ The biomedical industry, which was the biggest investment destination for venture capital (VC) firms from 2018 to 2020, fell to third place in the first half of this year. Investments in the biomedical industry from venture capitalists are declining. According to a report by the Biotech Policy Research Center, […]]]>

The biomedical industry, which was the biggest investment destination for venture capital (VC) firms from 2018 to 2020, fell to third place in the first half of this year.


Investments in the biomedical industry from venture capitalists are declining.


According to a report by the Biotech Policy Research Center, new venture capital investments in the biomedical industry amounted to 675.8 billion won ($486.2 million) in June 2022, ranking third after ICT (1.49 trillion won) and distribution and service industry (760.3 million won). billion won).


Venture capital investment in the biomedical industry began to rise after the Korea Stock Exchange (KRX) introduced the special technology listing system in 2005.


The system mitigates certain listing requirements, such as meeting certain profit requirements, for Kosdaq listing applicants based on their technological strength and growth potential.


In 2018, the biomedical sector became the most invested area by venture capital firms after registering an investment of 841.7 billion won. During this period, 17 of the 21 companies (80.9%) that went public through the Special Technology Registration System were biomedical-related companies.


The biomedical field has ranked first in venture capital investment for three consecutive years after receiving 1.10 trillion and 1.07 trillion won in 2019 and 2020, respectively.


However, the sector lagged behind the ICT industry in 2021, despite the increase in new venture capital investment to 7.68 trillion won, a strong increase of 78.4% from the previous year. ‘last year.


Venture capital firms invested a total of 2.42 trillion won in the ICT sector in 2021, nearly double the 1.76 trillion won invested in 2020. The amount of new venture capital investment in biomedical industry in 2021 was 1.677 trillion won.


The report attributes the downward trend in venture capital investment in the biomedical industry to the recent decline in the number of biomedical companies made public through the Special Technology Listing System.


The number of newly listed companies on the Kosdaq using the Special Technology Listing System has continued to grow each year, with 39 going public through the system in 2021.


However, unlike the high proportion of biomedical companies that went public through the system in 2018, only 14 out of 39 companies (35.9%) were biomedical companies in 2021.


These companies include VUNO, Prestige Biologics, NeoImmuneTech, BIODYNE, Life Semantics, Genesystem, curacle, DEEPNOID, ViGenCell, ABION, From Bio, CHA Vaccine Research Institute, GENINUS and ToolGen.


“Recently, the biomedical sector has been hit by a series of negative issues such as controversy over accounting irregularities and clinical failures,” the report said. “The filter technology special listing system is expected to be enforced more strictly, which, in turn, will affect listing and investment.”

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Carbon capture and removal receives record venture capital https://mariannebluger.com/carbon-capture-and-removal-receives-record-venture-capital/ Fri, 16 Sep 2022 13:26:58 +0000 https://mariannebluger.com/carbon-capture-and-removal-receives-record-venture-capital/ We live in the midst of a carbon capture boom. A new pitchbook data analysis published on Friday shows a record amount of venture capital investment flowing into post-combustion carbon capture companies and startups in the second quarter of this year. VCs invested an incredible $882.2 million across 11 deals, which easily set an industry […]]]>

We live in the midst of a carbon capture boom.


A new pitchbook data analysis published on Friday shows a record amount of venture capital investment flowing into post-combustion carbon capture companies and startups in the second quarter of this year. VCs invested an incredible $882.2 million across 11 deals, which easily set an industry record. For context, total investment in the sector for the previous four quarters combined totaled $432.1 million.

Post-combustion capture consists of removing carbon dioxide after it has been released. This includes point source capture – that is, the removal of carbon dioxide at the stack or wherever it is emitted – or direct air capture, which is the removal of carbon from the ‘ambiant air. The advantage of both forms over other forms of carbon capture is that they “can easily integrate (and capture carbon) with existing infrastructure,” according to PitchBook’s senior analyst analysis for emerging technologies, John MacDonagh.

Clearly, climate tech investors are taking notice. The biggest contributors to the significant uptick in investment were two big deals: Climeworks’ $634.4 million Series F round and Carbon Clean’s $190.7 Series C increase, with the former being the biggest investment ever in direct air capture technology. Carbon Clean also said its funding round was the largest ever for a point-source carbon capture company.

Carbon removal has a critical role to play in a net-zero world, although the amount needed depends on how quickly we reduce emissions now and in the decades to come. Industries like aviation, which are heavily dependent on fossil fuels and for which renewable energy alternatives are currently difficult or impossible to source, are part of the reason why direct air capture has taken off. scale.

Point-in-time carbon capture will also be crucial for industries like cement, which is responsible for 8% of global carbon emissions. Eliminating them from the manufacturing process will be extremely difficult, making carbon capture a near necessity for the industry.

While there are a growing number of companies looking to extract carbon from the skies or chimneys that attract VCs, regulations and policies are also aligning to make this a particularly attractive investment. Changes to the 45Q tax credit under the Cut Inflation Act, in particular, have made carbon capture more attractive. The IRA raised the value of carbon captured and used to extract more oil from the ground – a process with dubious climate benefits – from $35 a tonne to $60 a tonne. And it increased the tax credit for a tonne of carbon collected by direct air capture from $50 to $180.

Changes to the tax credit also lowered the eligibility threshold for projects, making it easier for small start-ups to qualify. That’s important “given the relative immaturity of the DAC space,” MacDonagh wrote, and it could help more startups get a foothold and grow.

Beyond venture capital funding, big tech companies have offered hundreds of millions up front to buy carbon removal services. This includes Frontier – Stripe, Alphabet and Meta are among its members – which has pledged to spend $925 million on zero carbon this decade. (The group made its first purchases this summer.)

As money pours into the space, technologies remain unproven at scale. And while regulations that could spur the growth of carbon capture and removal are in place, oversight is still relatively sparse. Parts of the carbon removal community are working on frameworks to ensure the technology does no harm, but a huge gap remains and any commitment would be voluntary at best.

There are also real concerns that the promise of carbon removal that works at some point could slow emissions cuts in the short term. This despite the fact that a ton of carbon not emitted today does not need to be eliminated tomorrow. Oil companies are investing heavily in carbon capture, which could give fossil fuels a lifeline or act as a front for greenwashing. (Carbon Clean’s Series C investment round was led by Chevron.)

Ultimately, venture capital investments are one piece of the puzzle in bringing the industry to maturity and ensuring it is used wisely and fairly.

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Institutional and Venture Capital Flowing Into Crypto Despite Market Slowdown https://mariannebluger.com/institutional-and-venture-capital-flowing-into-crypto-despite-market-slowdown/ Thu, 15 Sep 2022 03:00:00 +0000 https://mariannebluger.com/institutional-and-venture-capital-flowing-into-crypto-despite-market-slowdown/ It may be “crypto winter,” but investment in the sector continues to pour in, indicating a belief in the industry’s ability to rebound and generate profits. North area In one of the biggest moves in the crypto space recently, London-based venture capital giant Northzone has raised €1 billion (about $1 billion) to form a fund […]]]>

It may be “crypto winter,” but investment in the sector continues to pour in, indicating a belief in the industry’s ability to rebound and generate profits.

North area

In one of the biggest moves in the crypto space recently, London-based venture capital giant Northzone has raised €1 billion (about $1 billion) to form a fund that will focus on crypto and fintech startups.

The company, which has previously invested in companies like Spotify and Klarna, and web3 and DeFi startups like Sunscreen, Gro, and Magic Labs, plans to fund companies from early stages through initial public offerings.

Wendy Xiao Schadeck, a partner at Northzone, said the fund sees the digital asset industry as its “core sector” for them. “We’re keeping an incredibly open mind for the next generation of founders to define totally new categories as well,” she added.

Fidelity Crypto History

Fidelity Investments, one of the largest US stockbrokers, is considering allowing Bitcoin trading for individual investors, sources say. There has been no official announcement to customers yet, but Fidelity plans to provide the service to its more than 34.3 million brokerage accounts.

The CEO of a digital bank and crypto services platform, Galaxy Digital, Mike Novogratz, has hinted that Fidelity could become his client in the near future.

“A bird told me that Fidelity, a little bird in my ear, will soon transition its retail customers to crypto. I hope that bird is right. And so we are seeing this institutional march,” he said at the SALT conference in New York.

Fidelity “came” into Bitcoin in 2018 by offering Bitcoin trading activity to their hedge funds and institutional investors in 2018. Earlier this year, it launched 401(k) retirement plan offerings to corporate clients. .

JPMorgan & Ownera

JPMorgan, joined by a private management company LRC Group, participated in a $20 million round for tokenized asset infrastructure startup Ownera.

Ownera, an open-source protocol that supports the tokenization of securities on a public or private blockchain, plans to bridge tokenized platforms and traditional financial firms.

Last year, JPMorgan became one of the first major US banks to offer crypto trading to its clients. The company began advising its wealth management clients on access to cryptocurrency funds and raised approximately $45 million to offer the service through two different funds.

KKR & Securitize

A San Francisco-based digital asset securities company, Securitize has become the first company to offer a symbolic exhibition to a global investment fund, Kohlberg Kravis Roberts & Co., or KKR.

The Securitize fund is managed by Securitize’s digital asset management arm, Securitize Capital, which will provide exposure to KKR’s Healthcare Strategic Growth Fund II (“HCSG II”) using the public blockchain Avalanche.

The digital asset security platform leverages blockchain to raise capital, issue tokenized assets, onboard investors, and provide secondary trading.

Dan Parant, Managing Director and Co-Head of U.S. Private Wealth at KKR, explains the global fund’s desire to try blockchain: “With its ability to digitize operational inefficiencies and increase ease of use for individual investors , blockchain technology has the potential to play an important role in the future of private markets.

EDX Markets

An EDXM market backed by financial industry giants like Fidelity Digital Assets, Charles Schwab, Sequoia Capital, Citadel Securities and Virtu Financial has become fully operational.

EDXM is a platform that supports trading of digital assets through trusted intermediaries available to US retail and institutional investors. The platform will be powered by MEMX technology, a customer-centric marketplace operator founded in 2019.

Platform representatives say they have big plans for the future of EDXM, with other big players joining the board soon.

We look forward to welcoming additional participants to the exchange, which will drive continued trading in this important asset class while creating a virtuous cycle of continuously improved liquidity and efficiency underpinned by MEMX’s technology,” said said EDX Markets CEO Jamil Nazarali.

Web3 is also supported

But it’s not just trading platforms and digital asset services that are getting funding right now. According to the last DappRadar reportMetaverse and Web3 gaming projects have raised $748 million in investments since August from investment giants like Temasek.

“The amount of investment demonstrates that despite challenging and uncertain conditions in digital asset markets, leading investment entities remain bullish on the GameFi industry,” the DappRadar report said.

Disclaimer

All information contained on our website is published in good faith and for general information purposes only. Any action the reader takes on the information found on our website is strictly at their own risk.

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Venture capital tide ‘begins to die down’ https://mariannebluger.com/venture-capital-tide-begins-to-die-down/ Sun, 11 Sep 2022 15:39:04 +0000 https://mariannebluger.com/venture-capital-tide-begins-to-die-down/ Venture capital investment in Irish tech companies in the first half of the year rose 21% to a record €780 million, according to the Irish Venture Capital Association VenturePulse survey published in association with Guillaume Fry. However, this was largely due to an exceptional first quarter when funding reached 380 million euros. Funding in the […]]]>

Venture capital investment in Irish tech companies in the first half of the year rose 21% to a record €780 million, according to the Irish Venture Capital Association VenturePulse survey published in association with Guillaume Fry.

However, this was largely due to an exceptional first quarter when funding reached 380 million euros. Funding in the second quarter increased less than 2% year-on-year to 400 million euros.

“It was an overall strong first half for Irish tech companies raising funds, particularly considering the geopolitical and economic headwinds and the downturn in listed tech stocks during this period,” said Leo HamillPresident of IVCA.

“It remains to be seen whether the significant slowdown in second-quarter growth to below 2% heralds a tougher second half.”

Hamill also pointed to a 50% drop in funding from foreign investors which fell in the second quarter to 150 million euros against 300 million euros the previous year.

“This overreliance on foreign investment threatens Ireland’s ability to continue to develop world-class indigenous technology companies,” Hamill added.

“The tide of available global capital is beginning to ebb, underscoring the importance of our pre-budget submission recommending measures to boost domestic sources of finance.”

Seed financing, which represents first-round investments in the start-up phase, decreased by 7% to 47 million euros in the first half.

Sarah Jane Larkinchief executive of the Irish Venture Capital Association, said there was a rally in the second quarter, although she warned it was a weak base.

Seed funding in the second quarter increased 77% to €25 million from €14 million a year earlier.

“We are optimistic that this resumption of significant seed funding will continue as the government’s €90 million fund for Irish start-ups comes into effect in the second half of the year,” Larkin said.

Financing below €1m fell by 19% in H1 to €21m.

Deals in the €1-5m category fell 9% to €84m while deals in the €5-10m bracket fell 43% to €44m.

Source: IVCA/William Fry

The overall growth for the semester is due to an increase in transactions in the €10-30m bracket which increased by 50% to €260m, and in the above €30m bracket which increased by 36% to €370m. €.

“Based on trade size, it’s quite difficult to analyze what’s happening in the market until we see results for the next two quarters,” Larkin said.

“If the biggest deals don’t materialize in the second half of the year, then we could start to see a general slowdown. But if the big deals are big, it’s critical that start-ups and those looking to raise less than 5 million euros can find funding.

Download the list of venture capital recipients Q2 2022

Fintech led the way in the first half with 29% of the total, followed by software (24%) and life sciences (17%).

VenturePulse survey data covers equity raised by Irish SMEs and other SMEs headquartered on the island of Ireland from a wide range of investors.

This research is the result of information provided internally by members of the Irish Venture Capital Association and published information where IVCA members were not involved.

Photo: Leo Hamill, IVCA. (Photo: Chris Bellew/Fennell)

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Biden’s big climate bill isn’t a venture fund https://mariannebluger.com/bidens-big-climate-bill-isnt-a-venture-fund/ Fri, 09 Sep 2022 16:11:59 +0000 https://mariannebluger.com/bidens-big-climate-bill-isnt-a-venture-fund/ The Cut Inflation Act, signed into law last month by President Biden, earmarks about $370 billion for clean energy development and adoption. But it’s not a venture capital fund, despite the viral tweets to that effect. Why is this important: $370 billion is a ton of taxpayers’ money, and it will deserve careful scrutiny that […]]]>

The Cut Inflation Act, signed into law last month by President Biden, earmarks about $370 billion for clean energy development and adoption. But it’s not a venture capital fund, despite the viral tweets to that effect.

Why is this important: $370 billion is a ton of taxpayers’ money, and it will deserve careful scrutiny that starts from a place of common understanding — rather than a strawman’s top.

Tweets: David Sacks, founder of Craft Ventures, wrote:

“The biggest venture capital fund ever, except for no LP reporting, no measurable IRR, and no NYT or WSJ blockbuster stories about how managers of funds fell short of expectations. By comparison, the total value of all venture capital investments in the United States was $330 billion. And that was a bubble year. It was $167 billion. dollars in 2020 and $145 billion in 2019.”

Reality check: More than $200 billion of the $370 billion are tax credits over the next decade, including for solar power farms, electric vehicle purchases, and energy-efficient appliance purchases. Some of these measures include extensions of existing tax credits.

  • There are also additional appropriations for things like agriculture conservation programs ($20 billion), wildfire management ($2 billion), and coastal protection and restoration ($2.6 billion). billions of dollars).
  • Yes, tax credits can help boost the fortune private companies, such as those developing electric vehicles or microgrid hardware. But they are not in the same vein as equity investments in specific companies, either structurally or philosophically.

Sacks did not return a request for additional comment.

Capital risk : The closest thing to a “venture capital fund” in the IRA would be $11.7 billion for Ministry of Energy Loan Guaranteeswhich authorizes $350 billion in loan guarantee authority.

  • Yes, these are the same types of DOE loans that once supported Solyndra. But notice that $281 billion delta? This is because the overall default rate on these loans is extremely low, particularly because the DOE does not see itself as taking technology risks for a venture capitalist. Even in the 2000s, the program’s biggest loan was not to Solyndra, but rather to help Georgia Power build a pair of next-generation nuclear reactors.
  • Moreover, even the Solyndra-era DOE loan guarantee program generated about $30 billion in profits. And we know that because there were public accounts.

The bottom line: Governments often stumble when trying to play venture capitalist. Fortunately, that’s not a problem in this case, no matter how you feel about the Global IRA or its climate goals.

[Correction: An earlier version of this story had an incorrect dollar figure for the DOE loan guarantees included in the IRA.]

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Venture capital investment: what it is and where it goes https://mariannebluger.com/venture-capital-investment-what-it-is-and-where-it-goes/ Wed, 07 Sep 2022 15:37:59 +0000 https://mariannebluger.com/venture-capital-investment-what-it-is-and-where-it-goes/ OK, we heard you and we just need to point out a consistent theme – high school students have a pervasive entrepreneurial spirit. You tackle innovation issues and often take steps to start your own school clubs, or even real entrepreneurial ventures, to put ideas into action. Vera H., a 14-year-old sophomore from Texas and […]]]>

OK, we heard you and we just need to point out a consistent theme – high school students have a pervasive entrepreneurial spirit. You tackle innovation issues and often take steps to start your own school clubs, or even real entrepreneurial ventures, to put ideas into action. Vera H., a 14-year-old sophomore from Texas and grand prize winner of the 2022 Wharton Global Youth Comment & Win competition, puts it this way: “The opportunity to make discoveries, to create something of our own ; it’s what drives us to do our best.

Fuel for emerging businesses

While the passion that emanates from participants in our high school programs is a core business trait, it’s only part of the story of getting started, notes Dr. Luke Taylor, John B. Neff Wharton Professor of Finance and co-director of the Rodney L. White Center for Financial Research. “To start a business, it is not enough to have a good idea or a good product. You also need a lot of money,” says Taylor.

A key source of this initial funding is venture capital.

Venture capital funding is the fuel that propels start-ups and ambitious entrepreneurs around the world. Venture capital funds provide the capital – raised from high net worth individuals and institutions like investment banks, pension funds and endowments – to help start-up companies grow. VCs can also provide technical and managerial expertise to startups.

“It’s a very risky form of investing, because a large majority (about 95%) of startups fail,” says Sergei Netessin, Wharton Senior Associate Dean for Innovation and Global Initiatives and Professor of Operations, Information and Decisions. “However, those who do succeed can, in some cases, bring outsized returns to investors.”

Despite how simple these Shark Tank trades are on TV, investors rarely, if ever, see the returns overnight. “A venture capitalist gives money to a startup to help that company grow,” Taylor says. “The VC hopes to recoup that money – plus a return – several years later when the startup is bought by a larger company or goes public in an initial public offering.”

Trendy eyewear brand Warby Parker, founded in 2010 by two Wharton MBAs, is one example. The company secured its first venture capital funding in 2011 when it raised $1.5 million from investors in a Series A funding, or first round of venture capital funding. The company received six more VC injections (each indicating a new round of VC funding) via a $120 million Series G in 2020. In 2021, Warby Parker went public and began trading its shares on the New York Stock Exchange. The company was valued at $6.8 billion after its first day of trading on the stock exchange.

Warby Parker’s 2020 Series G was considered a mega-deal, Taylor notes, of which there have been many in recent years. Venture capital has long been a vital source of funding for high-growth startups, like Amazon, Facebook and Microsoft, and therefore a powerful contributor to the economy. For this reason and more, researchers and trade analysts closely monitor venture capital market activity and industry trends.

Netessine names DeepTech (technology based on new types of scientific and engineering advances and discoveries), FinTech (financial technology) and PharmTech (advances in healthcare products) as three innovation hotspots attracting capital funding -risk.

“Various Leadership and Thoughts”

An even broader and deeper trend in start-up funding seeks to improve the inclusiveness of the venture capital landscape, both from the perspective of investors and entrepreneurs. In recent years, the attention of the venture capital industry has focused on the funding gap faced by minority and female business founders. According to data from Crunchbase, for example, only about 1.3% of US venture capital went to black-founded companies in 2021.

Venture capitalist Josh Kopelman (W’92), managing partner of Philadelphia’s First Round Capital, spoke about the venture capital industry’s poor track record of funding entrepreneurs of color at the Tarnopol Speaker Series in Wharton Dean Erika James on the breed trade. “While the venture capital industry is seen as an industry whose superpower is seeing trends early and imagining alternative and better futures,” Kopelman said, “when it comes to racial equity, the venture capital industry has been a laggard, not a leader.”

Many companies are striving to incorporate diversity into the venture capital ecosystem. For example, fans of tennis great Serena Williams may have heard her talk about her venture capital firm Serena Ventures, a small company that invests in underrepresented entrepreneurs, including women, black founders and Latinos.

General partner Alison Rapaport Stillman, who majored in finance and operations at Wharton as an undergraduate, said people have finally realized that inequality exists in all aspects of life. “I want to emphasize that we are not investing in women and people of color to just tick a box,” Rapaport Stillman told the online publication. All increases. “We invest in diverse teams because we believe that diverse leadership and diverse thinking have the best returns, both financially and socially.”

What is Rapaport Stillman looking for in potential investors? A self-aware founder who can build a team of people with varying skills and strengths. For all those budding young entrepreneurs looking for funding, VCs care a lot about who they invest in. “The most important factor that VCs take into account is the team member’s experience, abilities, cohesion, etc.,” says Netessine. “Especially in the beginning, when little other data, like revenue or number of customers, is available.”

While getting venture capital investment is a standard way to grow a business, it’s not the only way, adds Netessine, who cites other sources of capital like angel investors, banks, accelerators and incubators (both of which support startups with resources until they are big enough to do it on their own). “Many companies prefer to start their growth with personal savings or the money of family and friends, rather than giving up significant equity. [company ownership] and power to the VCs.

Discover PS27 Ventures TikTok here.

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