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| Here’s a look at today's Startups briefing. - 💵 Startups that failed in 2023 had raised over $27B in VC funding.
- 📉 M&A activity dropped by 17% in the first nine months of 2023, per Carta.
- 🤝 TotalEnergies acquired three startups that emerged from the Station F incubator.
Thank you. Karan
p/karan-chafekar | |
| 1 | | 3,200 startups have failed so far this year, per Pitchbook data reviewed by The New York Times and Entrepreneur. Startups that failed had raised over $27B in VC funding since founding, nearly matching the $29.8B funding deployed into startups in Q3 2023. More: - Co-working space company WeWork, which filed for bankruptcy in November, had raised more than $11B in private capital before its public listing.
- Shuttered pizza automation technology firm Zume and freight startup Convoy had raised $500M and $1B, respectively.
- Investment firm IVP's general partner Tom Loverro has called the recent period a "mass extinction event" for startups.
- The dip in VC funding is partly responsible for the failure of startups.
- VC funding for startups dropped from $183.9B in the first nine months of 2022 to $104.5B in the same time this year.
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| 2 | | In the first nine months of the year, 429 startups on Carta's platform were either acquired by or merged with larger organizations. 
What the numbers say: Per Carta, the M&A activity has dropped by 17% compared to the same time last year. The dip is in line with the broader M&A activity slump seen globally. In the first eight months of 2023, global M&A deal value and volume dropped by 41% and 14% YoY, respectively, per BCG's latest global M&A report. Relevance: Investors remain optimistic about M&A prospects going into 2024 despite the current grim situation. BCG's Danny Friedman believes there will be "quite a bit of deal activity going into 2024," citing the vast reserves of dry powder available with investors and strategic acquirers and the stabilization of inflation and interest rates expected next year. Additionally, corporations will likely acquire firms to boost their growth, make supply chains resilient, and gain access to newer technologies and intellectual property. | | | |
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| 3 | | French energy and petroleum company TotalEnergies acquired three startups that were part of its TotalEnergies On accelerator program at Station F incubator in Paris. In addition, the firm acquired a 56% majority stake in French charging venture Time2plug. The acquisitions will help accelerate TotalEnergies' electricity and energy business. The acquisitions were valued at "a few tens of millions of euros," per Total's vice president Francois Badoual. More: - The three startups acquired are Swiss AI-powered energy price predictions firm Predictive Layer, French energy usage software maker Dsflow, and German renewable-project designer Nash Renewables.
- TotalEnergies aims to leverage Dsflow's solutions to provide procurement strategy optimization SaaS platform for multi-site electricity-intensive B2B customers and use Time2plug's technology to accelerate the deployment of EV charging stations in France.
- It will incorporate Nash Renewables' software platform to optimize the design and operating parameters of its renewable projects and Predictive Layer's machine learning and AI solutions to improve the performance of its trading operations.
Zoom out: - Total has hosted a program at the Station F incubator since 2022 to support early-stage startups working on renewable energy generation, battery storage, distributed energy management, power trading and retail, and electric mobility.
- 10 other startups in the accelerator program are set to receive commercial contracts from TotalEnergies.
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| 4 | | French startup studio Hexa is expanding beyond its studio model and is looking to partner with startups facing growth issues to help them with operations, international expansion, product development, and marketing. The firm is ideally looking for seed to Series A stage B2B startups that are generating between €1M to €10M in recurring revenue every year. More: - Augustin Celier, who previously co-founded Uptime, Shuffle, Marc&Aurèle, and CoursdePhilo, is tasked with leading the new initiative, dubbed Hexa Scale.
- In addition to helping startups, the firm will also provide them with capital.
- Hexa raised $22M (€20M) in fresh capital last month to launch B2B software companies.
- Hexa is most popularly known for starting successful startups like Front, Aircall, and Spendesk.
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| 5 | | Surveillance and reconnaissance spacecraft maker True Anomaly Inc. raised $100M in Series B funding. The firm will use the proceeds to scale its business and expand its team. The firm expects to grow its team to 190 employees by the end of 2024. It has already doubled its team size from 50 to 107 employees in the past year. More: - The firm completed the assembly of two of its autonomous orbital vehicles, Jackal, which will be deployed into low Earth orbit by SpaceX's Transporter-10 mission in 2024.
- Riot Ventures led the round, with additional support from Eclipse Ventures, ACME Capital, Narya, 645 Ventures, Rocketship.vc, and Menlo Ventures.
- The U.S. Space Force awarded the firm a $17.4M research grant earlier this year to continue development of its Mosaic software, which uses AI and automation to help fly dozens of small satellites in coordination with each other.
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| 6 | | Mark Cuban-backed climate startup dClimate signed a memorandum of understanding (MoU) with the Democratic Republic of Congo (DRC). dClimate will compensate the DRC for the right to store 100 million tons of carbon dioxide over roughly 500,000 hectares of peatlands for ten years. More: - dClimate will oversee the land to stop deforestation, assist Congo in creating a carbon-credit registry, and sell these credits in the open market.
- The credits are expected to be worth $7 to $10, giving the total contract a value of $1B, per co-founder Siddhartha Jha.
- Decentralized climate data infrastructure network startup dClimate will keep 10% to 20% of the credit payments as a fee.
Zoom out: - Per the World Bank, Congo forests are able to capture nearly 822 million tons of greenhouse gas annually.
- Congo's credits trade at $5 per ton of carbon dioxide in the market, substantially cheaper than regulated markets of the U.S. and Europe, where prices range from $80 to $140.
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| 7 | | Quick Hits: - Want to master Kubernetes? The Kubernetes Cookbook is a must-have guide to discover guidance on cloud architecture analytics, optimization, governance, and more.*
- Serial founder Eileen Lee has succeeded Aaron Hurst as the managing director of the accelerator program Endeavor Atlanta.
- Financial services company Singlife has started the second cohort of its Singlife Connect accelerator program to support promising insurtech and ecosystem enterprises.
- Indian Prime Minister Narendra Modi said that the government will launch an AI Mission to bring AI compute power to startups tackling healthcare, agriculture, and education problems.
- French procurement startup Pivot is in the process of raising $21.6M (€20M) in Series A funding from existing backers Visionaries, Emblem, Anamcara, and Oliver Samwer.
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 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Vibha Chapparike | |
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