Venture firms in general have had trouble this year raising new capital, but that didn't stop Canaan Ventures from pulling in $850 million total for two new funds.
The 35-year-old Menlo Park firm raised $650 million for its 13th flagship fund, which will focus on investing in early-stage companies, it announced Thursday. It also raised $200 million for a fund it plans to use to make add-on investments in the companies that are already in its portfolio.
Canaan's announcement came the same day that PitchBook Data reported that U.S. venture firms are on pace this year to record their lowest total fundraising total since 2017 and the smallest number of new funds in more than 10 years.
In the press release announcing Canaan's new funds, John Pacifico, a general partner at the firm and its chief operating and chief financial officer, thanked the investors who put money into the new vehicles. Many of them had invested with the firm in the past, he noted.
"Their belief in the firm and our consistent approach to venture allowed for a fast and efficient fundraising process despite market conditions, Pacifico said.
The firm's latest flagship fund is smaller than its last two. Both its 11th and 12 flagship funds, which it raised in 2017 and 2020, respectively, were $800 million vehicles.
In its press release, the firm touted its success. In the past five years, 14 of its portfolio companies went public — 10 through initial public offerings — and eight were acquired, it said. The total value Canaan realized from those exits was $1.7 billion, it said.
The firm has prided itself on being the first investor in some of the most promising companies, general partner Maha Ibrahim said in the press release.
"This consistent approach is intrinsic to who we are and how we work," Ibrahim said. "It's also invaluable to aspiring entrepreneurs during times of uncertainty."
Here's more startup and venture news from the end of the week:
Fundings
- HeartFlow Holdings Inc., Mountain View, $215 million, Series F: Bain Capital Life Sciences led the round for this developer of cardiac health diagnostic software. Janus Henderson, Baillie Gifford, Capricorn Investment Group, Hayfin Capital Management, HealthCor Inc., Martis Capital, U.S. Venture Partners and Wellington Management also invested.
- Hound Technology Inc. (dba Honeycomb), San Francisco, $50 million, Series D: Headline led the round for this provider of app debugging software. Insight Partners and Scale Venture Partners also participated.
- Chroma Inc., San Francisco, $18 million, Seed: Quiet Capital led the round for this developer of open-source database software for generative artificial intelligence applications.
- LightMetrics Inc., San Jose, $8.5 million: Sequoia Capital India led the round for this company that sells vehicle dash cameras and software designed to improve the safety of commercial fleets.
- Field Materials Inc., San Jose, $4.65 million, Seed: Blumberg Capital led the round for this provider of an online procurement marketplace for construction materials. Zacua Ventures also invested.
- Alga Biosciences Inc., San Francisco, $4 million, Seed: Collaborative Fund led the round for this developer of an algae-based feed additive for cows. Y Combinator, Day One Ventures, Cool Climate Collective, Pioneer Fund and Overview Capital.
M&A
- Navan Inc. acquired Tripeur. The companies didn't disclose the terms of the deal. Based in Palo Alto and formerly known as Trip Actions, Navan offers travel and expense management services. Based in India and legally known as Shorebird Technologies Pvt. Ltd.,Tripeur offers similar services.
- Learneo Inc. acquired Language Tool for an undisclosed amount. Based in Redwood City, and formerly known as Course Hero Inc., Learneo operates a collection of online learning businesses, including CliffsNotes. Germany-based Language Tool — legally, LanguageTooler GmbH — offers a multilingual grammar, style and spellchecking service.
- The Raine Group acquired Code Advisors LLC. The companies didn't disclose the financial terms. Raine is a New York-based merchant bank. Code Advisors is an investment bank based in San Francisco.
