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Big money-management corporations expanded their dominance in Silicon Valley final quarter, crowding out enterprise capitalists in a once-niche enterprise and placing 2021 on tempo to almost double final 12 months’s document in startup financing.
Hedge funds, mutual funds, pensions, sovereign-wealth teams and different so-called nontraditional venture investors had been extra energetic within the second quarter than in any earlier interval, in keeping with analysis firm PitchBook Data Inc. These corporations participated in 42% of startup financing offers, and people offers accounted for greater than three-quarters of the invested capital, in keeping with Pitchbook.
Investment in U.S. startups for the primary half of 2021 hit $150 billion, eclipsing full-year funding yearly earlier than 2020, in keeping with a report from PitchBook.
The massive asset corporations have large swimming pools of capital, transfer rapidly and are much less prone to ask for board seats or involvement in firm choices, usually making them extra interesting to founders, in keeping with interviews with buyers and startup executives. The end result has been a dizzying tempo of deal making.
“It’s like speed dating but more extreme,” stated Peter Fishman, a longtime Silicon Valley tech skilled who final 12 months co-founded data-automation startup Mozart Data Inc.
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