Inside Venture Capital

Here's a look at today's VC briefing.

• 󠀠🛰️ Global spacetech funding dipped by 35% in 2023
• 📈 One-year rolling IRRs showed a slight improvement in Q2 2023
• 🏦 FTX's debtors believe the bankrupt crypto exchange might be able to repay creditors, customers

Thank you.

Karan
p/karan-chafekar

Global spacetech startups raked in $4.6B in VC funding in 2023, 35% less than the previous year, per Crunchbase. Early-stage investor Space Capital's managing partner Chad Anderson expects app startups in spacetech to increase as satellite-enabled information streams mature. Anderson is particularly excited about the prospects of geospatial satellite intelligence, insurance applications, climate change modeling, and crop management applications within the spacetech domain. 

More:

• Despite the dip, investors remain bullish about the space infrastructure, probably due to its importance to defense tech and the government's funding support for the sector. 
  • Additionally, investors and startups are finding the sector appealing due to the lowered cost of launching a satellite. 
• Nearly all the funding went to Series A through Series D stage startups within the sector. 
• Notable funding rounds that closed in 2023 include commercial space station startup Axiom Space's $330M round from August, Sierra Space's $290M Series B round at a $5.3B valuation in September, and internet access satellite firm Astranis' $200M venture round at a $1.6B valuation in April.

Andrew Dietderich, an attorney representing FTX's debtors, believes the bankrupt crypto exchange might be able to fully repay customers and creditors. The debtors came to the conclusion after lawyers and accountants reconstructed the company's records. The argument gained traction due to the surge in crypto prices held by FTX since its insolvency. 

More:

• FTX also plans to liquidate its equity stake in AI unicorn Anthropic, which could net about $2B in returns at the current valuation. 
  • The crypto exchange had invested $500M in Anthropic when it was valued at $3.4B. 
• Dietderich believes finding a buyer for the FTX exchange's assets is improbable. 
• FTX's VC investors could be next in line to get some returns, should any surplus proceeds remain after paying off the customers and creditors. 
  • FTX had raised about $2B in VC funding from Sequoia Capital and Paradigm, both of which have marked down their stakes to zero.

Open-source proof-of-stake public ledger firm Hendera launched a $250M Web3-focused VC fund in partnership with the Saudi Ministry of Investment. The strategic alliance has a term of five years. In addition to the fund, the duo will set up a DeepTech Venture Studio in Saudi Arabia's capital city, Riyadh. 

More:

• The venture studio is part of Saudi's broader ambition to diversify its income away from oil. 
  • This move will help it gain traction amidst international companies across industries, such as AI and quantum computing. 

Zoom out:

• The launch of the VC fund and the venture studio comes as Hedera Hashgraph focuses on inking partnership deals and hitting growth milestones. 
• Earlier last month, Hedera allocated 5B HBAR, Hedera Hashgraph's native cryptocurrency, for ecosystem development and to increase its decentralized governance.

Today's Funding: 

Cleantech 

• Hybrid direct air capture technology cleantech startup Avnos bagged $36M in Series A funding. NextEra Energy Resources led the round, with additional support from Shell Ventures, Safran Corporate Ventures, Envisioning Partners, and Rusheen Capital Management. 

Cybersecurity

• Endpoint management, security, and monitoring startup NinjaOne touched a valuation of $1.9B after raising a $231.5M Series C round led by Iconiq Growth. The round was backed by Snowflake chairman and CEO Frank Slootman and Datadog Inc. president Amit Agarwal. 

Enterprise software

• Enterprise edge computing solutions provider Zededa doubled its valuation from $193M in 2022 to about $400M while raising a $72M funding round. Smith Point Capital led the round, joined by existing investors Lux Capital, Chevron Technology Ventures, and Porsche Ventures. 

Foodtech

• Plant-based foodtech startup Heura Foods closed its Series B round at €40M ($43M). Names of the investors were not disclosed. 

Manufacturing

• Glass container manufacturing firm Arglass bagged $230M in equity and debt funding from unnamed investors. 

Quick Hits:

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• Co-founder Adam Neumann has reportedly given a $200M financing package offer to revive the bankrupt company WeWork Inc., a move which could effectively put him back in control of the company. DGIM Law founding partner Daniel Gielchinsky argues that putting ousted leader Neumann "back at the helm of this company would almost certainly spell its demise in the long run."
• OpenAI Startup Fund secured $10M from two unnamed investors through an SPV, per SEC filings seen by Business Insider. The firm, which is affiliated with ChatGPT maker OpenAI, raised a $175M fund last year to back AI startups. 
• Indian early growth stage focused VC firm Cactus Venture Partners closed its debut fund at ~$75.9M (6.3B INR). The firm will primarily invest in Series A and Series B startups in climate tech, health tech, and B2B SaaS sectors. 
• Dice Enterprises, an Indian startup that helps businesses with expenses, invoicing, and payments, is reportedly in talks with Pavestone Capital to raise a new round of funding. 
• Chinese deeptech VC firm TH Capital hopes to reach its target of $100M for its debut USD-denominated fund by mid-year. 

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