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| Here’s your daily VC briefing: - 🤝 Akamai gears up to acquire Noname Security for $500M
- ⛔ Pitchbook expects startup shutdowns to ramp up in 2024
- 🗽 New York City witnessed the highest inflow of tech workers in 2023
Thank you. Karan
p/karan-chafekar | |
| 1 | | American software company Akamai is reportedly set to acquire Israeli cybersecurity company Noname Security for $500M. The acquisition price offered by Akamai is half compared to Noname's last known private valuation of $1B from Dec. 2021, when it raised a $135M Series C funding round. The deal value represents a 15x multiple over the firm's annual recurring revenue, sources informed TechCrunch. More: - Despite the markdown in the valuation, the deal could still provide a significant windfall for Noname's early-stage investors.
- Noname has bagged $220M in total funding to date from Georgian, Lightspeed, Insight Partners, ForgePoint, Cyberstarts, Next47, and The Syndicate Group.
- Akamai will take over all 200 employees of Noname.
- Earlier this January, The Information reported that Noname was trying to raise a downround.
- In the next month, Calcalist reported that Noname was negotiating with several potential buyers, including Akamai.
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| 2 | | Pitchbook anticipates a surge in startup shutdowns this year, driven by the intensifying fundraising competition among over 55,000 VC-backed startups in the U.S. amidst the current VC funding downturn. 
What the numbers say: In the first three quarters of 2023, about 2,000 VC firms halted new investments. About 3,200 startups shuttered in 2023, a number which is expected to pick up this year. Relevance: The demand for capital from late-stage and venture growth startups was more than twice the capital invested by investors in Q1 2024. Limited partners have curbed their capital deployment into the venture capital asset class, forcing general partners to exercise caution with new investments. VCs are conducting stringent due diligence and being sensible about valuations, except for AI and machine learning sector investments. Additionally, GPs now expect potential startups to demonstrate cash flow positivity at earlier stages and a clear path towards profitability. After analyzing capital availability, seed deals, and exits, Pitchbook concludes that there is a surplus of startups in the U.S. | | | |
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| 3 | | The greater New York City was the top destination for relocating tech workers, according to LinkedIn data analyzed by VC firm SignalFire. The region attracted 14.3% of tech workers relocating in the nation and lost 10.7% to the other areas, giving it an effective net gain of 3.6%. SignalFire's head of research, Asher Bantock, said the surge in tech workers is helping New York-based startups find the right talent. More: - About 37% of tech workers relocating to New York originated from San Francisco.
- New York is only second to the San Francisco Bay Area in attracting venture capital, per the Pitchbook-NVCA Venture Monitor.
- Overall, tech employment in New York increased by 17% compared to pre-pandemic levels.
- Austin, Texas reported the second-highest gain of 1.4%, followed by Los Angeles at 0.6%.
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| 4 | | AI startup Upstage has secured $72M in Series B funding to expand in the U.S., Japan, and Southeast Asia, per Bloomberg. The startup provides a document processing engine and large-language model to increase work efficiency across e-commerce, legal, healthcare, and other industries. Upstage is opening a new office in San Jose, California. More: - SK Networks Co., KT Corp, Korea Development Bank, Shinhan Venture Investment Co., and SoftBank Ventures Asia participated in the funding round.
- The new funding round's size is triple that of its previous round from 2021, when it secured $27M from SBVA and Company K Partners.
- The latest capital infusion brings Upstage's total funding raised to date to over $100M.
- Naver Corp.'s head of AI, Sung Kim, co-founded the startup in Oct. 2020 along with Lee Hal-Seok and Park Eun-Jung.
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| 5 | | Used-car marketplace startup Carra is looking to raise $100M in pre-IPO funding from investors at a valuation of $1.5B, CEO Aaron Tan informed Bloomberg. News about the upcoming funding round comes as the firm posted its first annual operating profit. Carro plans to expand operations to Japan and Hong Kong later this year. More: - The Singaporean startup is developing a tool that can analyze the health of a used car from the sound of its motor.
- Carra is backed by SoftBank, Singapore's GIC, and Temasek.
- The startup's EBITDA jumped from $3M in the previous fiscal year to $33M in the recent one.
- Tan founded the startup along with two fellow Carnegie Mellon graduates.
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| 6 | | Retail media startup PRIZM has exhausted 96% of the capital raised so far, sparking fears of total capital depletion. PRIZM reported operating losses of $14M on revenue of $1.18M last year. The startup operates a media commerce platform, serving about 70 brands. More: - Losses have increased compared to the $12M loss reported in the previous year against a revenue of $560,345.
- The firm had raised about $28.74M in total funding to date, half of which came in through a seed round shortly after its launch while the remaining came in through a pre-A investment round last year.
- South Korean social commerce giant Ticket Monster's former chairman Yoo Han-ik founded PRIZM.
- Notable backers of the firm include Z Venture Capital and JTBC-JoongAng Group.
- At the end of last year, the firm had just 3% of the capital remaining, or around $1.23M.
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| 7 | | Quick Hits: - Hims provides access to a range of hair loss treatments suited for your routine. Unlimited access to medical providers and complete care through the app.*
- German embedded solutions fintech startup finmid secured €23M ($24.7M) in Series A funding at a post-money valuation of €100M ($107M). Blossom Capital and Earlybird VC participated in the funding round.
- SIX Group led a $21M Series A funding round into Bridgwise, a startup that uses AI to provide investment research for global securities. Group 11 and L4 Venture Builder participated in the round.
- Kode Labs, a startup that automates systems in commercial buildings, raised a $30M Series B funding round, led by Maverix Private Equity. Other investors participating in the round include I Squared Capital and Telus Ventures.
- Proptech startup Radious launched a new national curation service, expanding its reach across the U.S.
- Pattern released a 30-page insights report for beauty brands selling on Amazon.*
*This is sponsored content | | | |
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18 | | Register now for Lacework's deep dive on what cybersecurity professionals need to know about the world's #1 attack vector. * | | | | | | | APR
18 | | Join us for pitches, drinks and networking at Pier 17 in SF on April 18, 2024 from 5:30pm. * | | | | | | | APR
25 | | Find out how to effectively align product and marketing teams during Optimizely's online session, "Bridging the Gap Between Marketing and Product."* | | | | | | * This is a sponsored event | | | |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Karan Chafekar | |
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