- Figma Thrives Post-Merger Fallout with $600M Revenue and Adobe's Billion-Dollar Parting Gift: Despite the canceled $20 billion Adobe-Figma merger, Figma expects robust financials, with over $600 million in annual recurring revenue (40% YoY increase). Positioned for a potential 2025 IPO, the company's balance sheet benefits from the billion-dollar breakup fee from Adobe. (Link)
- Relativity Space Eyes $4.2 Billion Valuation in Ongoing Funding Round Led by Bond and Social Capital: Relativity Space, known for its 3D-printed rocket, is in talks for a funding round at a $4.2 billion valuation, led by existing investors Bond and Social Capital. The round is partially closed, with ongoing fundraising efforts. (Link)
- Crunchbase Reader Survey: Optimism for 2024 Tech, Skepticism on IPOs and AI Impact: Readers express increased optimism about the economy and the startup landscape for 2024 compared to the previous year. However, skepticism remains regarding an IPO market rebound, and many do not anticipate a significant AI-driven transformation in the tech industry this year. (Link)
1. Family Offices Increasingly Investing Direct
- Family Offices Impact: Family Office AUM surged 78% to $25 trillion, with their market share now almost 30% of alternative assets
- Alternative Investments Rise: Private debt and alternatives grew 128% to $23.4 trillion
- Hedge Funds and Private Equity Plateau: Despite $22.6 trillion and $20 trillion AUM, they've shown stagnant growth since 2017, with market shares around 27% and 24% respectively.
- Venture Capital Challenges: AUM reached $19.6 trillion, up 67% since 2012, but its market share remains at 24%, unchanged since 2017, reflecting slow growth
2. Number of Generative AI Companies Explodes
- Marketing & Sales Leads Funding: 49 startups in Text - Marketing and Sales received funding, comprising 12.2% of 400 funded Generative AI startups.
- Audio and Customer Support/Chatbots Follow: Audio and Customer Support/Chatbot applications rank second and third, with 48 and 43 funded startups, making up 12.0% and 10.8% of total startups.
- Investment in Image Generation and MLOps/Platforms: 38 startups each in Image Generation and MLOps/Platforms attracted investment, constituting 9.5% of the total.
3. California vs. the World: AI Startup Headquarters Breakdown
- California's AI Startup Dominance: California hosts 70% of the top 50 AI startups, with 35 headquartered in the state, showcasing a significant regional advantage.
- Limited Representation Beyond California: Only 5 of the remaining top AI startups are outside California (4 in New York, 2 in Texas, 1 in Massachusetts), suggesting investment opportunities in emerging AI ecosystems beyond the state.
- Global AI Innovation Presence: While California leads, 7 foreign companies are among the top 50, emphasizing the global nature of AI innovation and the potential for international partnerships and investments.
4. Global VC Deal Activity normalizes, down 35% from 2022 and 54% from 2021
- Deal Activity Normalizes: After the staggering run up of 2021 and 2022 in deal making, 2023 returned to normalized levels from 2018 - 2020
- The Impact Of Alternative Funding Sources: The rise in Special Purpose Vehicles (SPVs) providers contributed to the run up in asset prices. This allowed an explosion of new investors in the market - with more family offices, individuals and small funds investing directly.
5. Global VC Exit Activity Remain Well Below Annual Averages
- 2021 Remains Historic Year For VC: 2021 was a historic year for venture capital. With the sharp rise in rates, exit activity has dropped significantly below historic averages.
- Limited Partners Remain Over-Allocated To Space: Investors piled into illiquid VC assets in 2021. Additionally, LPs that received record distributions invested those back into funds - leaving them over extended to the asset class.
Explore the potential of Syndicate VC at?www.privateventuresgroup.com.
Subscribe to our newsletter for more insightful content!
