Is the Great Rebound underway?

    Recent Developments from the USA Front Show Promise.

   The BVP Nasdaq Emerging Cloud Index, a barometer of public tech valuations in the US, reveals an impressive +17% surge from January through September. However, a somewhat concerning -10% net change in Q3-23 warrants attention.

   September witnessed significant IPOs on the NYSE, notably the highly anticipated $55bn offering of the British Softbank-owned chip-designer Arm, marking the largest IPO on the exchange in two years, alongside marketing software giant Klaviyo at $10bn.

   These triumphant IPOs are poised to pave the way for more to come, reigniting ambitious aspirations among private market investors.

   Turning our gaze to France’s private market, signs of recovery are emerging. The colossal €2.2bn secured by electric battery manufacturer Verkor in September, comprising €850m in equity, €600m in debt, and €650m in subsidies, bodes well for the sector.

   Moreover, the cumulative funds raised by French Tech startups have plateaued at approximately €2bn for a fourth consecutive quarter. M&A activity in Q3-23 reached a total deal value of €1.6bn, marking one of the highest quarters in the past two years.

   In terms of capital increase multiples, Fintech and Medtech have experienced the most pronounced impacts, with an approximate 30% decline in their EV multiples compared to the previous year, whereas other sectors have seen positive shifts.

   Regarding exits, the subscription model is receiving more acclaim than ever, with a +16% EV multiple expansion year over year.

Arthur Porré, Founding Partner, October 4th, 2023