Good day. Venture-capital firms have struggled to return capital to investors over the past several years with public listings drying up and M&A activity sputtering. A new fund aims to capitalize on this liquidity crunch.
Scenic Management, a late-stage, private growth equity investment manager, has raised a $150 million sophomore fund, doubling down on its strategy to purchase shares of private companies from early-stage venture firms and senior-level employees. Scenic Management has also raised a variety of co-investment special-purpose vehicles.
The demand for the fund reflects the relative lack of exits in the past few years, Scenic Management co-founder and President Mike Sobel said. That market dynamic has created opportunity in the so-called secondary market, where shares of private companies can be traded before a potential initial public offering or acquisition.
San Francisco-based Scenic tapped institutional investors, family offices and wealthy individuals to raise the fund, called Scenic Private Access Fund II. Scenic will deploy the fund over two years and is aiming to return capital to its investors within five years, which would provide investors with a shorter exit timeline than is typical for private investments, Sobel said. Roughly 20% of the fund will be used to make direct equity investments in companies, Sobel added.
And now on to the news…
Top News
Round values Abridge at $5.3 billion. Abridge, a startup that has automated doctors’ note-taking with artificial intelligence, on Tuesday said it had raised $300 million in funding, The Wall Street Journal reports. The round, led by venture-capital firm Andreessen Horowitz with participation from Khosla Ventures, values the startup at $5.3 billion. In February, Abridge raised $250 million at a valuation of $2.75 billion. The fundraise comes at a time where so-called ambient-listening tech, which tunes in to the exchanges between doctor and patient and then transcribes the conversations, is gaining traction at hospitals and health systems.
80+
The number of Chinese companies that have delisted their shares from U.S. exchanges since 2019, according to data provider Wind.
Stablecoin World Opens Up to Main Street Banks
Thousands of Main Street banks struggling to keep up with crypto’s push into mainstream finance will soon get an opening to the rapidly evolving world of stablecoins, WSJ reports. Financial-technology giant Fiserv plans to launch a stablecoin and platform that could be used by its clients, which include roughly 3,000 regional and community banks, executives told The Wall Street Journal. The platform is expected to be compatible with other stablecoins and allow for easy connection with the other 10,000 financial institutions and millions of merchant locations that Fiserv works with.
FTV Joins Lightyear as Co-Owner of Legal Tech Company ProfitSolv
FTV Capital is joining Lightyear Capital as a co-owner of legal and accounting technology company ProfitSolv to capitalize on an artificial intelligence boom, zeroing in on businesses that traditionally lag behind in tech adoption, WSJ Pro reports. The deal marks an exit for minority investor Greater Sum Ventures, FTV and Lightyear executives said, and a strategic shift for Lightyear, which explored selling the business before bringing in FTV as an equal co-owner.
Industry News
People
Emerging, a growth-capital firm investing in restaurant-entertainment concepts and restaurant-technology companies, said it has appointed G.J. Hart as managing partner. Hart previously was president, chief executive and director of Red Robin Gourmet Burgers.
New Money
Legal AI company Harvey, based in San Francisco, raised a $300 million Series E round at a $5 billion valuation. Kleiner Perkins and Coatue co led the round. Other investors included Sequoia, GV, DST Global, Conviction, Elad Gil, OpenAI Startup Fund, Elemental, SV Angel, Kris Fredrickson, and REV, the venture arm of RELX Group, which owns LexisNexis. The entire round was primary, a company representative said.
PhysicsX, a London company that’s developing AI engineering software for physical industries, raised $135 million as part of its Series B financing. Atomico led the round, with participation from Temasek, Siemens, Applied Materials, July Fund, and existing investors including General Catalyst, NGP, Radius Capital, Standard Investments, and Allen & Co.
Conquest Planning, a Winnipeg, Manitoba-based provider of financial planning software, raised C$110 million ($80 million) Series B funding round led by Growth Equity at Goldman Sachs, with participation from Canapi Ventures, BDC, Citi Ventures, TIAA Ventures, USAA, and existing investors BNY Ventures and Portage.
Kognitos, a San Jose, Calif.-based AI automation platform for business operations, secured $25 million in Series B financing led by Prosperity7 Ventures.
Snowcap Compute, a Palo Alto, Calif.-based startup developing a superconductor platform for data centers, raised $23 million in seed funding led by Playground Global. This is the first investment by former Intel Chief Executive Pat Gelsinger since he joined Playground as a general partner earlier this year. Other investors in Snowcap’s seed round include Cambium Capital and Vsquared Ventures.
Tadaweb, a Luxembourg-headquartered provider of a small data operating system for publicly available information and open-source intelligence, picked up a $20 million investment from Arsenal Growth and others.
Lyceum, an AI cloud startup with headquarters in Berlin and Zurich, landed a €10.3 million pre-seed investment led by redalpine.
BackOps AI, a San Francisco-based AI supply-chain management startup, raised a $6 million seed round led by Construct Capital.
Tech News
- Millions of résumés never make it past the bots. One man is trying to find out why.
- Hims & Hers stock drops more than 30% after Novo Nordisk breakup.
- The Holy Grail of automation: Now a robot can unload a truck.
- New York to build one of first U.S. nuclear-power plants in generation .
Around the Web
- How ex-OpenAI CTO Murati’s startup plans to compete with OpenAI and others (The Information).
- The music industry is building the tech to hunt down AI songs (The Verge)
The WSJ Pro VC Team
This newsletter was compiled by Yuliya Chernova, Matthew Strozier and Zachary Cole.
WSJ Pro Venture Capital is a premium service of The Wall Street Journal. We cover venture capital and the global startup ecosystem. Share your tips, comments and questions: vcnews@wsj.com
