This Week In VC covering vc from a student perspective

September 06 (TWIVC Newsletter #07)

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This is a weekly newsletter covering the top stories in startups, venture capital, and cutting-edge technologies. The newsletter is organized into three sections: a recap of the biggest stories of the week, a long-form deep dive into a specific topic, and a profile of a lesser-known fund.


Weekly Recap

  1. 💵 Neon Pagamentos receives a large cash deposit

    Brazilian fintech Neon Pagamentos raised $300 million in a Series C, following its $92 million Series B last November. The startup functions as a digital bank, offering credit cards, personal loans, and investment products. Neon plans to use the funding to expand the team, grow user bases across the B2C and B2B verticals, and develop new products on the company’s digital platform. The round was led by General Atlantic with participation from Vulcan Capital, PayPal Ventures, Endeavor Catalyst, and Blackrock.

  2. 💊 Biofourmis gets new (cash) medicine

    Digital therapeutics startup Biofourmis raised $100 million in a new round of funding this past week. The Boston-based company focuses on predicting diseases before they happen via an array of patient-facing tools like biosensors and an app. Biofourmis plans to use the funding to develop, validate, and commercialize released and unreleased digital therapeutics products and services. The round was led by SoftBank, with participation from existing investors EDBI, MassMutual Ventures, Openspace Ventures and Sequoia Capital.

  3. ⚡️💻 Myst AI raises an electrifying round of capital

    San Francisco-based Myst AI raised $6 million in Series A financing, bringing its total funding to $8 million to date. The startup focuses on using AI to create a data analysis platform for electricity demand and supply forecasting. Myst AI plans to use the funding to expand its Forecasting-as-a-service product offering to customers. The round was led by Valo Ventures with participation from Gradient Ventures.

  4. 🤖Sarcos Robotics builds a new round of funding

    Salt Lake City-based Sarcos Robotics raised $40 million in Series C funding, bringing its total funding to $96.1 million. Sarcos produces robots that augment humans to enhance productivity and safety, especially in industrial applications. The company plans to use the funding to begin commercial production of its ‘Guardian XO’ industrial exoskeleton for release in 2021. The funding was led by Rotor Capital, with participation from existing investors like Schlumberger.

  5. 🧬 Erasca cures a new round of capital

    Oncology drug developer Erasca raised an additional $36 million to bring its Series B round to a close with a total of $236 million. The company develops oncology drugs intended to provide precision oncology options. Erasca will use the funding to further support the clinical development of oncology programs, drive corporate development efforts, and further advance the in-house drug discovery pipeline. The extension added Partner Fund Management and OrbiMed to the main round led by ARCH Venture Partners and Cormorant Asset Management with EDBI, Terra Magnum Capital Partners, and Invus participating.

  6. ⚙️ Transposit operates itself to new funding

    San Francisco-based Transposit raised $35 million in Series B funding this week, bringing its total funding to date to $50.4 million. The startup focuses on providing automation, integration, and extensibility to DevOps teams to keep infrastructure and systems running smoothly. The funding will be used to expand the sales and engineering teams and build out its go-to-market initiatives. The round was led by Altimeter Capital with participation from Sutter Hill Ventures, SignalFire, and Unusual Ventures.


VC Profile

I like to profile lesser-known venture funds who are focused on impact investing, run specialized mandates, or have a diverse set of GP’s leading the fund. Let me know if you come across an interesting fund!

This week, I’ll be profiling Acumen, a non-profit impact investment fund that invests in social enterprises that serve low-income communities across Sub-Saharan Africa, South Asia, Latin America, and the United States. To-date, they’ve invested over $126 million in 126 companies in 14 separate countries around the world. Acumen emphasizes their philosophy of “patient capital” in order to provide entrepreneurs the flexibility and security to grow their businesses. Acumen focuses on six verticals - agriculture, education, energy, heath, housing, and water/sanitation.

Acumen focuses on seed and early-stage investments in order to enable social enterprises to validate assumptions, bring products and services to market, and begin scaling. I would like to emphasize that they invest in non-profit enterprises.

Acumen is led by Jacqueline Novogratz, who founded the fund in 2001. Novogratz had previously created Rwanda’s first microfinance institution, Duterimbere, which inspired her to write The Blue Sweater: Bridging the Gap between the Rich and Poor. She sits on the boards of the Aspen Institute and 60 Decibels and sits on the Advisory Councils of the Harvard Business School Social Enterprise Initiative, the Oxford Said Global Leadership Council, the NYU Stern Center for Business and Human Rights, and UNICEF.

I’m excited by these recent investments:

Recent exits include:


Sector Analysis: FoodTech!

Continuing the sector by sector focus of major VC activity in place of the long-term for a couple weeks!

Foodtech is a red-hot space that has begun emerging in the last few years with the rise of alternative food manufacturers like Beyond Meat and Impossible Foods along with delivery companies like Grubhub, Uber Eats, and Instacart. The space includes technology-driven startups developing products and services that are changing the traditional structure of how food is discovered, purchased, delivered, prepared, and consumed. The space is generally broken into five areas: bio-engineered foods, food suppliers, intermediaries and delivery, discovery and review, and industrial & consumer tech.

With the COVID-19 pandemic staying omnipresent for the last few months, the food tech space has exploded. A surge in demand for food delivery and marketplace apps as a result of social distancing protocols has resulted in increased revenues, valuations, and market entrants. Much of the forced innovation as a result of the pandemic will become permanent, with the food ecosystem slowly shifting towards improved delivery, pickup, and functionality.

The main trends over the last few years in FoodTech include:

1) Online grocery becoming more mainstream

2) Plant and lab-based meat garners significant market share

3) The rise of ghost kitchens with no brick-and mortar dining location

Beyond online grocery and food delivery, VC activity was significantly down for Q2 2020. Major raises were Deliveroo with a $575 million Series G investment led by Amazon, DoorDash with a $400 million series H investment, and Manus Bio with a $340 million Series B.

A great market map by Pitchbook can be seen below.

Top VC’s investing in FoodTech include:

Investor Name Deal Count (since 2019)
CPT Capital 18
Unovis Partners 12
Agronomics 11
Enterprise Ireland 9
Social Starts 9
Horizons Ventures 8
Artesian Capital Management 8
Clear Current Capital 7
Beyond Investing 7
Kale United 7

Addendum

If you have any suggestions, comments, or ideas, please feel free to reach out to me at rohil at upenn dot edu.