Biotech and Energytech Take the Lead: A Look at the Top VC Investments

The last month shows us a very clear focus on biotech and energytech, with the three companies having secured the most funding in the past 30 days all coming from these sectors. Apart from fintech, the sectors of biotech and energytech are among the most influential and therefore also popular areas VCs are currently investing in.

The high interest for these segments is a good thing not only because of the positive impact on society and environment, but also for the VCs themselves: The demand for new medical treatments and sustainable energy solutions is growing rapidly, and by investing in these areas, VC institutions are positioning themselves to benefit from the financial returns that are looking to be outrageously high if the demand keeps rising as it has in the past years.

As always, I invite you to read and share your opinion on this topic and also on the other international venture capital topics I have put together for you this month.

Biotech is coming in strong this month with Cambridge (MA) based Orbital Therapeutics taking the cake.

ARCH Venture Partners has led a Series A round for the startup, which raised $270 million to advance its programmable RNA therapeutics portfolio. The funds will be used to increase the application of RNA-based medicines for the development of new vaccines, immunomodulation, and protein replacement.

Orbital is currently working on an RNA platform that can combine different RNA technologies and delivery systems to increase the durability and enhance delivery to various cell types and tissues.

Apart from the development of new vaccines, Orbital has also made new appointments in the C-Suite, naming a new COO and CFO.

In a public statement Giuseppe Ciaramella – Orbital’s co-founder and CEO – emphasised that RNA-based therapeutics have significant potential for the future of medicine, and the company is dedicated to exploring that potential.

Early investors included a16z Bio + Health and Newpath Partners, while new investors were Exor, Invus, the Redmile Group, the Abu Dhabi Growth Fund, Moore Strategic Ventures, the iGlobe Platinum Fund Group, and Casdin Capital.

Green hydrogen company Ohmium is the runner up in this month’s list of highest funding secured. The Fremont and San Francisco based startup landed $250 million. Ohmium specialises in design, manufacturing, and deployment of advanced proton exchange membrane (PEM) electrolyzer systems.

The round was led by TPG Rise Climate, the dedicated climate investing strategy of TPG’s global impact investing platform TPG Rise, and included participation from

Hanover Technology Investment Management as well as existing investors Energy Transition Ventures and Fenice Investment Group.

The funds will be used to expand Ohmium’s annual manufacturing capacity, as well as to support the deployment of projects for the company’s growing global customer pipeline in key regions such as the U.S., Europe, India, and the Middle East. In addition, the investment provides significant capital to accelerate Ohmium’s business growth, including research and development programs aimed at reducing the cost of green hydrogen production.

This is good news for the broader green hydrogen industry, as it demonstrates continued investor confidence in the potential for this technology to play a significant role in the transition to a more sustainable energy futu

The third company in this month’s bio and energy tech trio is Vedanta Biosciences, also a Cambridge (Massachusetts) based biotech startup like Orbital Therapeutics.

The cushy $106.5 million in funding was co-led by AXA IM Alts and AMR Action Fund. This brings the total amount raised by the company to over $430 million since being founded in 2010.

The latest funding round will enable Vedanta Biosciences to advance its efforts in developing oral therapies for Clostridioides difficile infection (CDI), a bacteria that causes diarrhea and colitis. According to the company, CDI leads to around half a million infections annually in the United States alone, and has been associated with up to 45,000 deaths each year.

With the support of new and existing investors, Vedanta Biosciences is well-positioned to continue its important work in addressing the significant unmet medical need associated with CDI.

Existing investors were the Bill & Melinda Gates Foundation, Skyviews Life Science, Reimagined Ventures, Fiscus Ventures, PEAK6, and Atlantic Neptune. New investors were K2 HealthVentures, Korea Investment Partners, Korea Investment & Securities Asia Ltd. and Korea Investment & Securities US, Inc.

Polarium is putting Sweden on the map when it comes to tech startups in the sustainability sector. Their recent evolution to unicorn status is only the last in a string of events.

Polarium, a Stockholm-headquartered firm that specialises in providing energy storage solutions based on lithium-ion technology for industrial, commercial, and telecom sectors, has secured approximately $100 million from Swedish pension company AMF. This investment has enabled Polarium to attain a valuation of $1B. The partnership with the Swedish company AMF is expected to further Polarium’s expansion plans.

Established in 2015, Polarium has committed to working for a sustainable future by providing intelligent, adaptable energy storage solutions that utilise lithium-ion technology. The rapidly expanding Swedish firm achieved a compound annual growth rate of approximately 150 percent from 2016 to 2021. The funds raised through equity financing will enable Polarium to sustain its rapid growth trajectory, speed up its innovation efforts, and make investments in all operational areas.

Shareholders of Google’s parent company are not having a good time at the moment, and Samsung is to blame in this case.

Alphabet, the parent company of Google, suffered a loss of up to $55 billion in market value in mid-April, with the stock falling by 4%. All of this was due to a report by The New York Times, which revealed that competition in the mobile search market is heating up, and this could lead to Alphabet losing its annual revenue of about $3 billion.

Samsung is reportedly considering replacing Google with Microsoft’s Bing as the default search engine across its range of devices. This move could seriously jeopardize Google’s revenue and market share. To make matters worse for the tech-giant, Alphabet’s contract with Apple, which accounts for roughly $20 billion in annual revenue, is up for renewal later this year.

Although Google has held a near-monopoly on the search market, commanding a market share of about 90%, it is now facing increased competition after Microsoft integrated OpenAI’s ChatGPT into its Bing search results earlier this year.

Alphabet is fighting back, though. The company is working to protect its market share by incorporating artificial intelligence features into its Google search product, with a team of over 160 people dedicated to the task. However, this might not be enough if Samsung chooses Bing as the default search engine across the hundreds of millions of devices it ships each year.

The only silver lining for Alphabet is that negotiations between Samsung and Microsoft are still ongoing, and Google could still end up being the default provider. Plus, Alphabet has some exciting plans up its sleeve. The company is currently working on its own answer to ChatGPT, called Bard. While the initial release hasn’t been successful so far, Alphabet is determined to stay competitive in the generative AI search market, in which ChatGPT is thriving.

A few months ago, I reported that the African venture capital scene was displaying immunity towards the global slowdown. This has changed, as also African startups are starting to feel the bite of the sluggish global economic situation.

Recent data has shown us that funding has slowed in the past few quarters, with March being described as the worst month in 2.5 years for the continent. However, it’s not all “doom and gloom” – deals are still being made, including a $4 million round for Nigerian mobility company Shuttlers and a $2.5 million round for Senegal-based Chargel.

The bigger picture however, is not particularly motivating so far. In 2022, 633 African tech startups raised a combined $3.3 billion, a growth of 12.2% from the previous year. However, this year’s Q1 has seen less than half the number of startups secure funding compared to last year, and a combined total of $649 million. If the trend continues, it could mean a decline of over 50% in year-on-year funding. It’s important to keep a close eye on these developments as Africa’s startup scene plays an increasingly important role in the global tech ecosystem.

Another factor to consider is that – just as the Russo-Ukrainian war is affecting the European landscape, current conflicts in Africa, e.g. the civil war in South Sudan are also impacting the continent in many ways. Venture Capital is of course not immune to that either.

Dropbox, the cloud-based file hosting service, is taking bold steps towards the future by laying off around 500 employees, accounting for approximately 16% of the company’s entire workforce. CEO Drew Houston sees this as an opportunity to build out their AI division and put Dropbox at the “forefront of the AI era,” while citing the current economic situation as the main reason for the layoffs.

Houston has always been a strong supporter of the AI environment, and is now making moves towards “machine intelligence” that will allow Dropbox to better understand and serve its customers. To achieve this, the company has already introduced AI-powered features, such as automatic text recognition in 2018. However, the latest action to replace current employees with those experienced in AI signals Dropbox’s commitment to making a significant shift towards this.

As part of this change, Dropbox plans to consolidate its core and document workflow businesses, and it’s making adjustments to its product development teams. Houston believes that all hands on deck will be needed to take advantage of machine intelligence and reimagine existing businesses and invent new ones.

Dropbox is and will continue to be profitable after the layoffs, which Houston described as a “natural maturation” for the business.

As was announced last February, Falon Fatemi and Mark Cuban’s interactive streaming platform Fireside has now confirmed having raised $25 million at a $138 million valuation, confirming its funding and valuation through a recent investor update.

What definitely helped secure the funds in Series A is the innovative character of the app, which enables creators to distribute their shows everywhere: with just a click of a button, creators can distribute their shows outside of the app and benefit from what the company calls “sophisticated analytics” that enable them to understand what type of content resonates with audiences in real time.

Apart from this, Fireside has acquired Stremium, a streaming TV platform, enabling the company to expand its offerings and bring interactive technology to smart TVs. This development will allow viewers to watch content on the big screen while engaging with it via their phone, with comments appearing on the TV screen. In a statement by the company itself stated their unique selling point in being the “only platform that turns creators, celebrities, brands, and IP owners into the studio, networks, and streaming services of the future.”

Given this background, there is not much room for doubt that this startup will be highly successful. Fatemi, at only 31 years, is known for making sound business decisions as she has as CEO of Node and Mark Cuban isn’t very unsuccessful himself when it comes to entrepreneurship.

This month gave us a good overview of how important innovation and competition (these are sentences I normally only write in my antitrust articles) can be in the venture capital scene. Alphabet’s huge loss in valuation is a constant reminder to us that companies, no matter how dominant, need to stay in touch with consumer’s needs and partner relations if they want to stay on top. A fallout with Samsung and the rise of Bing’s ChatGPT shows that even a 90 % market shareholder can have that power chipped away from under its feet very fast.

Apart from this, Africa’s VC scene is currently declining as political situations all over the world continue to be unstable. Where at first it seemed that the African startup scene was relatively immune to the worldwide slump we saw in the past years, it seems to have caught up with the African region in the form of low Q1 numbers.

Good news on the other hand is a sharp incline in bio and energytech, as the trend towards these sections keeps increasing. The winners of this month are Orbital Therapeutics, Ohmium International and Vedanta Biosciences.