’21 The Year of Super Rounds

Money is certainly moving in Q1 and it’s moving in large quantities.

Supergiant funding rounds of $100 million or more are taking headlines so far in 2021. We’re just barely into the new year, investors already put at least $46 billion globally into such deals, according to Crunchbase data. That puts 2021 on track to come in well above 2020’s already historically lofty levels.

Not many years ago it would be a rare occurrence to see the amount of $100m+ rounds we are seeing so far this year. It was common to see a couple supergiant deals in a week, as of this year it’s routine to see several in a single day. Often rounds are several multiples of $100 million. And so far this year, at least seven private, venture-backed companies have closed investments of $1 billion or more.

When looking at these types of rounds there has been a steady increase over time. There also is sector bias for these rounds and I’ll list out those sectors below:

Top sectors include transportation, fintech, health care, e-commerce and enterprise software. Here’s how it breaks down:

  • Transportation: This is the biggest category, with $7.7 billion across nine rounds of $100 million and up. Investments run the gamut from autonomous vehicles to electric bikes.
  • Financial services: The next-biggest category is fintech and financial services with $5.5 billion invested across 21 rounds. Focus areas include online stock trading, lending platforms and faster checkouts.
  • Enterprise software and analytics: The enterprise space was also big for supergiant fundings, with $5.1 billion invested across 21 rounds, per Crunchbase data, dominated by cloud, analytics and AI.
  • Health care: As usual, health care was also one of the big categories. Investors have put $4.1 billion to work across 24 supergiant health-related rounds this year, including at least 10 early-stage deals. Biotech dominated the list, with a bit of insuretech and health data as well.

These are the supergiant funding sectors of interest and they track fairly closely with what we’re seeing on public markets, which have been highly receptive in recent months to venture-backed offerings in the sectors mentioned above.

With that statement we’ve seen a lot of major rounds for companies that are planning to go public.

  • Rivian, which raised $2.65 billion in a growth round led by T. Rowe Price and joined by several private-equity investors. The funding comes as the Michigan-based maker of electric trucks and SUVs is reportedly considering going public later this year.
  • Robinhood, another talked-about IPO candidate for this year, has pulled in $3.4 billion since January in financing led by existing investors amid record customer growth for the Silicon Valley company’s zero-fee stock trading platform.
  • UiPath, the robotic process automation unicorn, raised $750 million in a Series F round led by Coatue and Alkeon Capital Management. The financing, at a reported post-money valuation of $35 billion, comes as the company preps for an IPO later this year.

It’s not only late-stage companies that are getting these major checks from investors. There are at least 41 of the supergiant funding rounds so far this year have been Series A and B deals, per Crunchbase data. Looking at U.S. rounds, they include $500 million for EQRx, a startup focused on making medicines more affordable; $350 million for Calendly, a scheduling tool; and $115 million for Savage X Fenty, the acclaimed lingerie brand founded by the superstar musician Rihanna.

With massive funding rounds on the rise, it poses the question of, where do we go from here?

Primarily Growth & Venture Content // Avid Art Collector and Newfound Traveler (All Thoughts are My Own)