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Investment Highlight: Are Public Companies Damaging Private Markets?

Investment Highlight: Are Public Companies Damaging Private Markets?
February 1, 2022

The Daily Stack is a daily private market insights newsletter by PrivCo, a private company intelligence platform. Read our previous insights.
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Happy Chinese New Year & Welcome to the 1st Day of Black History Month. Don't worry if you're not feeling celebratory. It is, after all, the start of the shortest month of the year, with the most dismal weather and the highest daily rate in your rent or mortgage payment. Still, we're closer to the first day of Spring than the start of Winter (meteorologically).

Has the Bubble Burst?
The year 2021 set the record for global capital raised at $643BN, more than doubling 2020's previous record. With all that money flying about, and competition from nontraditional investors pushing valuations and funding rounds higher and higher, there has been much speculation about whether we might have reached another tech bubble. The recent stock market volatility and tech-stock sell-off have led many to believe the bubble has indeed burst, at least for late-stage investments.

What's next for dealmaking?
A factor in favor of the enormous investments and outsized valuations over the last year has been the unbeatable performance of public tech companies. Now that the NASDAQ is already down 15% in the new year, investors are seeing valuations through less rosy-colored glasses. Expect to see down-rounds in late-stage deals (where valuations are lower than or equal to previous funding rounds) and companies scrapping plans to go public. 

Who will be victorious?
Still, some companies have managed to secure huge raises already this year. Swiggy, the Indian food delivery startup, raised $700MM at a $10.7BN just last week. Crypto-asset platform Fireblocks raised $550MM to reach an $8BN valuation after quadrupling its customer base in 2021. The lesson in all this dealmaking, if there is one, is that good business models and wise financial decision-making are always the safest bet.

The Meta Transformation
How's the transformation of the company fka Facebook to the metaverse shaping up?
[NY Times]
Tax Season Shuffle
Busy season for public accountants has become quitting season.
[The Verge]
Since last week, PrivCo has added:
2,225 Companies | 237 Funding Activities | 194 M&A Deals

Funding & Deal Highlights:

 

 

Lumavate raises $6MM from Gutbrain Ventures

PaaS • Equity • Carmel, Indiana
 

Pennylane raises $57MM from Sequoia Capital

Fintech •Equity • Cherbourg, FR
 

Wonderment raises $6MM from Charles River Ventures

E-Commerce • Seed • Boston, MA
 

Deepnote raises $20MM from Index Ventures

Data Science • Round A • San Francisco, CA


Purely Elizabeth raises $50MM from SEMCAP Food & Nutrition

Food • Round B • Boulder, CO


The Desire Company raises $8MM from Valor Equity Partners

Consumer Reviews • Round A • Atlanta, GA


Vendelux raises $2.4MM from Tenacity Venture Capital

Digital Marketing • Seed • New York, NY


Appcues raises $39.1MM from NewSpring Capital & BridgeBank

Product Design • Debt & Equity • Boston, MA


Descartes Underwriting raises $120MM from Highland Europe

Insurtech • Round B • Paris, France


Continu raises $13.5MM from Five Elms Capital

CRM • Round A • San Francisco, CA


Athelas raises $72MM from General Catalyst Partners

Diagnostics • Round B • Mountain View, CA


Vynca raises $30MM from Questa Capital Management

Digital Health • Equity • Palo Alto, CA


Phantom raises $109MM from Paradigm.xyz

NFT • Equity • San Francisco, CA


Olive.com acquires Uproar.car Corporation

Auto • Acquisition • Seattle, WA


Midgal acquires Global Energy Generation for $355MM 

Renewable Energy • Acquisition • Philadelphia, PA


Cengage Group acquires Infosec Institute for $190.8MM

Cyber Security • Acquisition • Madison, WI
 

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