KPIs

The week’s top performance indicators

Partner

3i Members: Access Alternative Deal Flow

3i Members is a network for accomplished private investors made up of 400+ members—all of whom have exited a company or lead a family office. Recently, 3i surveyed their network to assess members' investment trends. The notable change? Private equity reached its highest point in 12 months, hitting 34%. 3i actively curates opportunity sets by considering member preferences and market cycles over time, and in their recent Monthly Deal Meeting, they showcased two deals within the private equity space.

Learn how 3i sources & diligences investment opportunities

Dots & Lines

The week’s top takeaways

• Going public is middling: It’s halftime of 2024, and signals are mixed for the backlog of Pre-IPO unicorns looking to go public. New issues like Reddit, Rubrik and Astera Labs have been well-received, raised significant amounts of capital, and the stocks have performed. But the market’s expectations for new public companies remain stubbornly high, with few offerings taking place, which may be keeping most unicorns on the sidelines for now. The window is ajar, to be certain - not closed like it was for most of 2023 - and as more companies get through, it should open further. The back half of the year may bring macro volatility with an election and geopolitical uncertainty, but could also feature rate cuts or positive economic news. Look for a larger cohort of Pre-IPO companies to make the jump in the second half, but don’t expect floodgates to open prior to 2025.

• Next device still sought: On a planet with more computers than people, the opportunity to own the next interface is massive. This year featured quite a few new entrants, but supplanting the iPhone remains elusive. Apple’s Vision Pro second version is being abandoned in favor of a lighter, cheaper alternative. Humane, with the category’s most ambitious and creative concept, is selling its tech. Other entrants look bound for the dustbin of tech history. But with advances in hardware, the emergence of GenAI and the frustration smartphones, this opportunity is bound to attract yet more well-funded suitors.

  

  Humane’s new UI - original and creative, but not resonating with users

• Seedpocalypse time: It was inevitable. Just a few years ago liquidity was widespread, new seed funds were popping up en masse and multi-stage funds started to play earlier. This swelled the ranks of seed-stage companies. In today’s market, expectations for Series A rounds are creeping higher and a traffic jam has arisen. The “Seedpocalypse,” as VC Tomas Tunguz dubbed it, has hit the market, with five seed companies per A round getting done. Carta data echoed this, showing the gap spans across sectors with a “graduation rate” for raising an A within two years after a seed round below half of recent norms. Look out for this crunch to drive combinations, pivots and shutdowns in coming quarters.

• Hamilton Lane was the latest to close a mega-secondaries fund, with $5.6B to hunt for mispriced assets

• Cerebras, an Nvidia challenger that raised $720M and was valued above $4B in its last round, filed for an IPO

• Data juggernauts are battling it out for the lead in warehousing and use of AI, with Databricks priced privately at 18x forward revenues while its public competitor Snowflake trades at 10x

• Waabi, a Toronto-based self driving truck startup founded by the former Chief Scientist of Uber’s Advanced Technology Group, raised $200M Series B led by Uber and Khosla

• Maryland-based Huntress, a cybersecurity provider to small businesses, raised a $150M Series D led by Kleiner and Sapphire

• Spanish space exploration company EOS-X Space raised a $123M Series D led by FTI Capital Advisors

• AI Video generation platform HeyGen raised a $60M Series A at a $500M valuation led by Benchmark, and announced it had grown ARR to $35M

• As the search for liquidity broadens for investors and teams, European challenger bank Revolut is looking to sell $500M in a secondary at a $40B valuation

• Ecommerce company Shein, founded in China and last valued at $600B, has just about ruled out any possibility of a US IPO as it finds itself caught in a tangled web of geopolitics

• General Catalyst absorbed Venture Highway, an Indian seed firm whose last fund was $60M, as it looks to deploy $1B in the region

• Packy McCormick’s missive “The Goldilocks Zone” compares AI to oil, suggesting that it most likely does not pose existential risks and will drive the next era of growth

• OpenAI’s former Chief Scientist Ilya Sutskever announced Safe Superintelligence, Inc. (SSI) his new AI company focused on safety in its quest to develop a breakthrough AI system