A $60M venture fund with a twist, and more startup-on-startup acquisitions | Equity Podcast

This episode is presented by invest Puerto Rico if you believe your business Can go anywhere Puerto Rico is the [Music] Place hello and welcome back to equity The Tech runch podcast where we unpack The numbers and the Nuance behind the Headlines this is Alex and today is April 10th 20 2024 Welcome to our Wednesday show where We dig into the critical startup and Venture Capital stories from the week Thus far and Today's Show is packed Because there was so much good stuff to Choose from so here's what I picked Guy's Big new round that shows just how Hard it is to get a unicorn price tag These days another startup buying a Startup story you know I love those why Monad Labs is such a gutsy Venture deal Cerra and cyber security and finally a New $60 million Venture fund that has a Very interesting geographical twist Let's Go first up today is guesty a platform That helps accommodation managers handle Their business on platforms like Airbnb And verbo it just raised $130 million and sources tell Tech runch That the company's valuation at its Series F was around $900 million post Money now the startup is based out of New York but does have roots in Israel And says that its Revenue grew 5x in the

Last 3 years and it expects to turn Profitable this year I'm reading the Profitability point as I don't know cash Flow positivity but regardless those are Pretty impressive numbers now the Company wouldn't give us actual Revenue Figures but I do think when we compare Its price to its performance we do get An indication about how things have Changed in the world of venture Valuations KKR this round and the space That guesty competes in is heating up so Guesty last raised a Series E of 1070 Million that valued it at 690 million Back in August of 2022 and guest's close competitor Hostway raised $175 Million last May and Then within a day of that news get your Guide raised $194 million so lots of Capital going into the space I think Because people are once again traveling And therefore managing airb and Bs is a Bigger business so there's more people To sell to now how did guesty manage to Raise so much money in today's market in Such a competitive space I dug in just a Little bit and it turns out the company Offers a blizzard of services for Short-term rental providers things like Payments and websites and actually even Capital so the company has gone broad Inside of its Niche to help get big and Keep growing ah man it's a lot of work To not be a unicorn but then again the

Venture Market is probably back back to Normal pricing now which only feels Weird because of how long that last Bubble Lasted next up more startup buying Startup stories I'm a complete sucker For these so I will always put them on The show when I get a chance today Multiverse which is a uk-based unicorn That Tech runch says builds Apprenticeship programs for people to Learn Tech skills well on the job has Made an acquisition to actually upskill Itself now in this case the company is Buying search light with which is a Startup that builds AI based Recruitment And assessment products so why the tieup Well Tech runch reports that the plan Will be to use search lights Tech to Create new AI products that Multiverse Its new parent company can use to expand Its Training Services for professionals Very cool now to give some scale here Multiverse has raised over $400 million According to Crunch base search light in Contrast has raised less than 20 million So we're talking about a roughly 20x Differential in capital raised so it Makes sense that Multiverse is doing the Acquiring and search light is doing the Selling this deal reminds me of the Wonders school early day transaction That we saw recently and actually had The CEOs from on the show a few weeks

Back I'll throw a link to that in the Show notes in short we are seeing larger And better funded startups by smaller Less well-funded rivals or tuck and Services really that can bolster their Overall product mix and therefore Velocity recall that guesty does a lot Of different stuff well one way to avoid Having to build all that new stuff from Scratch is to Simply absorb a smaller Company that might have struggled to Raise a round at an attractive price and Already built what you might want to Have built yourself right I love these As they come out we'll talk about each And every single one of them that I see Next up is a very interesting Venture Capital funding event that made me sit Up and wonder what I was reading and That's what I love to see in a venture Capital deal because it should be a Little bit out there right that's the Case with monad Labs so Fortune got the Scoop here I'm going to go ahead and Quote them monad Labs quote finalized a $225 million round LED by Paradigm with Additional funding by investors Including Electric Capital and Green Oaks to build a layer one blockchain to Challenge competitors such as salana Okay this is awesome so what does all That mean well it means that Paradigm And the monad crew think that there is Room in the market for another base

Layer blockchain or L1 if you want to Use the term so think Bitcoin and Ethereum and salana not l2s or layer 2 Chains like bass if you need a super Crude and stupid analogy well boy do I Have one for you l1s are like operating Systems to l2s which are more like apps That's clearly too far of a stretch but You get the idea and that's why the Monad lab's funding round is so Interesting another L1 is a big deal if It actually has a shot at working and The monad crew just put nearly a quar Billion dollars of investor Capital into Their pockets to try to give it a try I Don't think it's really that great that We live in a two horse mobile OS world And nearly as limited a PC OS world just To be honest so more l1s returning to my Tortured analogy are fine by me and There is other stuff going on in the World of web3 tech rench also recently Reported that Kiki world just raised $7 Million for its hybrid Beauty startup SL Web3 service so how does that work well Tech wench writes that the company Intends to allow its community members To vote on the features they want before The beauty products are made and then if You do vote you get points and digital Tokens now the thing that kind of threw Me here is the blockchain aspect of Kiki Is kind of obscured users will be able To vote via email which then makes me

Kind of wonder why you need the Blockchain but maybe this kind of like IRL SL web3 thing is going to work I Don't know but Kiki just got 7 million For its plan so let's see and I guess Let's see if they eventually build it on Whatever L1 monad comes up with what's Next in Tech that's not the right Question it's where Puerto Rico more Than just a Tropical Paradise it's an Innovations Paradise where startups and Global players coexist in a vast and Vibrant ecosystem where Talent runs deep Highly skilled and bilingual plus the Island offers the most competitive tax Incentives in the US if you believe your Business can go anywhere Puerto Rico is The place find out more at invest pr.org Crunch [Music] I'm going to squeeze one more startup Story in today of course we will have Deals of the week on the Friday news Roundup but very briefly cerra just Raised $300 million at a $1.4 billion Price deag and that's Cy e r a this is a Lot of capital at a unicorn price so it Caught my eye because we don't see this Too often and then the deal is doubly Interesting because the company raised $100 million last year we don't see that Many companies doing back-to-back yearly Raises let alone in the nine figure Range let alone tripling from 100 to

$300 million so clearly whatever Sierra Is working on investors are excited by It and what is it doing well data Focus Cyber security of course data is once Again the hottest thing out there Because AI wants to eat all of it and Cyber security is very important because Well everyone's getting hacked I have Been a little confused by the lack of Big cyber security rounds in the market Lately and that's because their Public Market comps companies like crowd strike And zscaler are some of the fastest Growing companies out there in the Market but this Sierra round does in Fact help me understand what's been Going on because the company just raised Enough money for five or six big cyber Security rounds all at once so I guess Investors were just waiting for cerra to Go back into the [Music] Market before we go a little bit Venture Capital news to throw into the mix this Morning Tech run reports that verid Keple Africa Ventures or vka plans to Back up to 21 growth stage companies Across the continent after closing its First fund of $60 million now the fund Saw its first and second close back in 2022 and is now just done fundraising Which I think just goes to show how Difficult and how much the funding Market has changed for the Seas but

Given that Africa as a continent has Seen its total Venture Capital Activities slow in recent years it's Good to see more Africa HQ funds Investing in the area because it's good News for local Founders now vered kepal Africa Ventures bkav is based in Nigeria But techren rights is part of a growing Number of African VCS that are receiving Backing from Japanese institutional Investors looking to diversify their Risks this is very interesting if you go Back in time there's been a lot of Coverage of different countries Investing in Africa there was China Doing a lot of infra in Africa for a While for example and now we're talking About Japan investing in African VCS Again just super cool and I'll just say That I think we'll probably see more of This over time especially in societies That have shrinking and aging Populations kind of looking outside Their borders to invest anyways bkav 60 Million Africa love It that's our show for this lovely Wednesday morning our Friday Roundup With Maryann aeto going into deals of The week and the biggest themes from This week in startup and Venture Capital News will drop Friday morning we'll of Course see you then but if you need even More from Team Equity well we are Equity Pod over on xn threads and we are Tech

Runch pods over on Tik Tok my name is Alex this is equity Wednesday I'll talk To you soon Bye Equity is hosted by myself Alex Wilhelm and Tech rench senior reporter Mary an aeto we are produced by Teresa Loans solo with editing by Kell Bryce Durban is our illustrator and a big Thank you to the audience development Team and Henry pette who manages Tech Runch audio products thank you so much For listening and we'll talk to you next Time