Happy Friday. Here’s what we’ve got today…

• A look at StepStone’s venture secondaries strategy

• Plus, Ares contemplates deal for GLP Capital Partners

Venture secondaries is having its moment:

By Bob Clair

StepStone Group announced earlier this month that it held a $3.3 billion final close for its sixth venture secondaries fund, the largest ever raised for the asset class.

The fund surpassed its $2.6 billion target and handily beat the previous venture secondaries record—a $1.45 billion fund raised by Industry Ventures last September.

Speaking to Transacted, StepStone partner John Avirett attributed the outcome to a combination of track record and market timing.

“This was our sixth fund, so we like to think we know what we’re doing,” said Avirett, whose team joined StepStone as part of its acquisition of Greenspring Associates in 2021.

StepStone’s fund will provide liquidity to founders and early investors in mature venture-backed companies, purchase interests in venture capital funds from LPs, and assist fund managers with structured solutions such as portfolio strip sales, tender offers, and continuation funds.

“We’ll do a direct secondary if we really like the business, but we can then buy more of that company by buying a fund position where that company makes up a big piece of the NAV,” says Avirett. “We’re ultimately using tools in the toolbox to build exposures into the companies that matter, and if you do that correctly, you can produce returns that look highly differentiated versus traditional secondaries.”

Growing market acceptance may also provide a tailwind for the asset class as a whole.

“The traditional view is that venture capital is a cradle-to-grave industry where the only exit opportunities come from a full acquisition or IPO,” Avirett said. “With exit timelines extending by several years and trillions of dollars locked up in illiquid private companies, that mindset is starting to change.”

Hunter Somerville, a partner at StepStone, provided added color on the calculus taken ahead of secondaries exits.

“As people have taken their medicine and done discretionary markdowns, things have now mostly settled to a point where it’s time to consider it,” Somerville said. “We’ve seen a pretty significant supply pickup over the last two to three quarters.”

Current conditions could continue to support elevated activity through at least the end of the year.

“Interest rates are still an issue, and until the presidential election, a lot of companies aren’t going to do anything drastic,” said Somerville. “The secondaries market is a safe option for a lot of organizations,” added Avirett.

• Ares (NYSE: ARES) is in talks to merge with GLP Capital Partners, a real estate investment firm that manages around $66 billion of assets across Japan, Southeast Asia, Europe, the US and Brazil, per Bloomberg.

• Hellman & Friedman, TPG, and Vista Equity Partners are among the remaining bidders for Aareon, the software business of German real estate lender Aareal Bank, which is targeting a valuation of around €3 billion, per Bloomberg.

• Sony Pictures acquired cinema chain Alamo Drafthouse from Altamont Capital Partners and Fortress Investment Group.

• The Carlyle Group and KfW are in talks to acquire a majority stake in Thyssenkrupp’s submarine unit in a deal that could value the business at up to €1.6 billion, per Reuters.

• Kirin Holdings agreed to acquire Fancl, a Japanese cosmetics and dietary supplements maker, for around $1.4 billion.

• Seed Health, a microbial sciences company, is exploring a sale that could value it at more than $1 billion and has retained Centerview Partners as its advisor, per Reuters.

• The French government offered to acquire the defense-strategic assets of Atos, a French IT services company, including its advanced computing and cybersecurity businesses, for around €700 million in order to keep them under French control through Atos' restructuring.

• Sixth Street Partners acquired a portion of Echo Minerals' net royalty acres in the Permian and Anadarko basins for more than $500 million.

• Leonard Green & Partners invested in RedSail Technologies, a provider of pharmacy management software, with additional investment from existing backer Francisco Partners.

• EQT acquired a majority stake in CluePoints, a provider risk-based quality management software for clinical trials, from Summit Partners and Clinimetrics SA.

• Ardian has entered exclusive negotiations to acquire a majority stake in Alstef Group, a provider of automated and robotic solutions for the airport, logistics, and parcel sorting markets.

• Great Point Partners acquired Lyocontract, a German CDMO focused on aseptic liquid filling, lyophilization, and parenteral drug packaging.

• Clearhaven Partners acquired Zixi, a provider of broadcast-quality live video delivery solutions.

• Serent Capital invested in HarperDB, a distributed systems platform.

• Intuit (Nasdaq: INTU) agreed to acquire Zendrive, a mobility risk intelligence provider.

• London Stock Exchange Group (LSE: LSEG) is in advanced talks to acquire parts of PrimaryBid, a UK-based fintech that helps companies raise capital by offering shares to retail investors.

• Brightside Health acquired Lionrock Recovery, a virtual substance abuse counseling platform.

• EPAM Systems (NYSE: EPAM) acquired Odysseus Data Services, a health data analytics company.

• Simulations Plus (Nasdaq: SLP) acquired Pro-ficiency Holdings, a provider of life sciences intelligence solutions for medical affairs and commercialization teams, from QHP Capital for $100 million.

Portfolio Company Add-Ons

• 3t, backed by Bluewater, acquired ALL STOP!, a Houston, Texas-based provider of safety training for the oil and gas industry.

• GenServe, a portfolio company of GenNx360 Capital Partners, acquired Electro-Motion, a provider of generator maintenance services in the San Francisco Bay Area.

• Sellers Dorsey, a portfolio company of Consonance Capital Partners, acquired HealthDataViz, a healthcare data analytics and visualization firm.

• HMH Holding, a joint venture between Baker Hughes' Subsea Drilling Systems business and Akastor's MHWirth AS, has selected JPMorgan Chase, Piper Sandler, and Evercore as underwriters for its IPO, which could come as soon as September and is targeting a valuation of around $1.5 billion, per Bloomberg.

Tech, Vertical SaaS, & Misc. Enterprise

• Cognigy, an AI-first customer service automation platform, raised $100 million in Series C funding led by Eurazeo Growth, with participation from Insight Partners, DTCP, and DN Capital.

• Learn to Win, an enterprise training software provider, raised $30 million in Series A funding led by the Westly Group, with participation from Norwest Venture Partners and Pear VC.

• Findigs, a NYC-based proptech focused on rental screening, raised $27 million in Series B funding led by Nyca Partners, with participation from RPM Ventures, Streamlined Ventures, Expa Ventures, Activant Capital, Colle Capital, and Frontier Venture Capital.

Fintech

• AccountsIQ, a Dublin-based cloud accounting platform, raised €60 million in Series C funding led by Axiom Equity.

• Layer3, an identity and distribution protocol, raised $15 million in Series A funding co-led by ParaFi and Greenfield Capital, with participation from Electric Capital, Immutable, Lattice, Tioga, LeadBlock, and Amber.

• Light, a Copenhagen-based general ledger platform, raised $13 million in seed funding led by Atomico, with participation from Entrée Capital, Cherry Ventures, and Seedcamp.

• Sidekick, a London-based wealth management platform, raised £8.5 million in seed funding co-led by Pact VC and TheVentureCity, with participation from MS&AD, Blackwood, 1818, Octopus Ventures, Seedcamp, and Semantic Ventures.

• CleverCards, a Dublin-based digital payments platform, raised €8 million in new funding from Pluxee.

• EnFi, a Boston-based AI fintech startup, raised $7.5 million in seed funding led by Unusual Ventures, with participation from Boston Seed, Argon Ventures, and Impellent Ventures.

• Sahl, a Cairo-based mobile bill payment app, raised $6 million in Series A and seed funding led by Ayady for Investment and Development, with participation from Egypt Pay, Delta Electronic Systems, and E-Finance.

• Jump, an AI software platform for financial advisors, raised $4.6 million in new funding from Sorenson Capital and Pelion Venture Partners.

Consumer & Media

• FUZE Technology, a Los Angeles-based provider of pay-per-use mobile charging stations, raised $11.5 million in Series A funding led by Beverly Pacific, with participation from Palm Tree Crew, Bain Capital Ventures Scout Fund, Dream Ventures, Live Nation Entertainment, ASM Global, SCIENCE Ventures, Haslem Sports Group, Sunday Ventures, SeaHorse Express, and Locker One Ventures.

• Roamless, a travel connectivity startup, raised $5 million in seed funding led by Shorooq Partners, with participation from Revo Capital, Paribu Ventures, Finberg, and Deba Ventures.

Healthcare

• Enveda Biosciences, a biotech using AI to translate natural compounds into new medicines, raised $55 million in Series B2 funding led by Premji Invest, Lingotto Investment Fund, Microsoft, and The Nature Conservancy, with participation from Kinnevik, True Ventures, FPV, Level Ventures, and Jazz Venture Partners.

• AVAVA, a Waltham, MA-based medical aesthetics company, raised $35 million in Series C funding from Jeisys Medical and Catalio Capital Management.

• Better Health, a San Francisco-based medical supply provider for people with chronic conditions, raised $14 million in new funding from Healthworx, UHealth, Mosaic, Samsung Next, Caffeinated Capital, General Catalyst, Bill Ackman's family office Table Management, and at.inc/.

Industrials, Greentech, & Other

• Echion Technologies, a UK-based developer of niobium-based, fast-charging battery materials, raised £29 million in Series B funding led by Volta Energy Technologies, with participation from CBMM, BGF, and Cambridge Enterprise Ventures.

• Swift Solar, a San Carlos, CA-based developer of perovskite photovoltaics solar tech, raised $27 million in Series A funding co-led by Eni Next and Fontinalis Partners, with participation from Stanford University, Good Growth Capital, BlueScopeX, HL Ventures, Toba Capital, and Climate Capital.

• Aepnus Technology, developer of an electrochemical platform to improve circularity and reduce emissions in battery supply chain chemicals, raised $8 million in seed funding led by Clean Energy Ventures, with participation from Voyager Ventures, Lowercarbon Capital, Impact Science Ventures, Muus Climate Partners and Gravity Climate Fund.

• PAG is planning to hold a $4 billion final close for its fourth pan-Asian buyout fund, less than half of its original $9 billion target set in 2022, per Bloomberg.

• MidOcean Partners raised $765 million for its third Tactical Credit Fund.

• J.P. Morgan Asset Management raised $500 million for the launch of its Life Sciences Private Capital fund, which is targeting early and growth stage investments across genetic medicines, oncology, rare and neurodegenerative diseases, and healthcare AI/ML.

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