Business & Legal Developments

9 min readMar 13, 2025

Friends,

In last month’s newsletter, we dove into two pivotal trends shaping the venture capital (VC) landscape heading into 2025: the surge in AI-driven investments and the growing role of corporate venture capital (CVC) in larger funding rounds.

This month, we examine the evolving dynamics of VC dealmaking and the ongoing challenges startups face in raising capital. We also take a closer look at the evolving landscape of CVC and its impact on mergers and acquisitions.

Despite making up nearly half of the total VC deal value over the past decade, CVC investments have not translated into a high volume of acquisitions. Data from PitchBook reveals that fewer than four percent of CVC-backed companies were acquired by their corporate investors. Instead, many corporations use minority investments to gain access to innovation, market insights, and strategic partnerships without committing to a full acquisition. This approach allows corporations to remain flexible and mitigate risks, especially as many startups view IPOs and alternative exits as more favorable forms of investment than acquisitions. While some may expect CVC investment to naturally lead to M&A activity, the reality is that strategic alignment, stage preference, and corporate goals often make acquisitions less common.

At the same time, the venture market continues to feel the effects of the inflated valuations of 2021, with a record-high number of startups facing flat or down rounds in 2024. Nearly 25% of U.S. venture deals last year saw valuations remain the same or decline, a level not seen in over a decade. While median startup valuations have technically increased, this growth is misleading as it largely reflects lingering high valuations from the past rather than new investor enthusiasm. The time between funding rounds has lengthened, and valuation step-ups have remained sluggish. However, certain sectors, such as climate tech, have bucked the trend, with late-stage valuations reaching record highs. Looking ahead, investors are hopeful that lower interest rates will improve IPO prospects, though venture exits remain slow-moving. Although these challenges persist, startups are still securing funding, though the process has become more difficult in today’s cautious market.

As always, do not hesitate to contact us if we can help you brainstorm a legal or business challenge you are facing or connect you to a potential investor, professional, or entrepreneur.

Spotlight on Sidebar Summit

Sidebar Summit | February 26, 2025
Protiviti and Robert Half recently hosted the Sidebar Summit at their Menlo Park office. They featured an exclusive fireside chat with Adam Cheyer, Vice President of AI Experience at Airbnb and Co-Founder of Siri. The discussion was moderated by Bill Barhydt, CEO and Founder of Abra. Adam provided valuable insights into the evolution of AI-driven user experiences, sharing his perspective on the trajectory of artificial intelligence (AI) and its growing impact on technology and business. The event offered attendees a unique opportunity to engage with thought leaders at the forefront of AI innovation. Foley was proud to be part of this engaging discussion, with Louis Lehot joining industry professionals, including Vishal Verma, Imad Ansari, and members of the Protiviti team, Robert Gould, Jeffrey Miller, Justin Krystopher, CPA, and Nathan Hilt.

Events

Upcoming:

AI and Greece: An Emerging Innovation Destination | March 20, 2025
Join Foley and the Hellenic Innovation Network on March 20, at our Palo Alto office, for an in-depth discussion on Greece’s strategic advancements in artificial intelligence. Featuring Andreas Stavropoulos from Threshold Ventures and Tota Zoura from FalconX, along with a Startup Panel moderated by George Panagiotakopoulos, the event will explore Greece’s evolving role in the global AI landscape and emerging opportunities within its tech ecosystem. A networking reception will follow, providing attendees the opportunity to engage and connect.

Capital Connect: Rising Above the Noise | April 24, 2025
Join Foley, CollectiveMinds, and HSBC Innovation Banking in Silicon Valley for Capital Connect, an insightful afternoon exploring the dynamic landscape of the biopharma industry. This year’s event features a group of panelists discussing investment trends beyond mega-deals, including financing prospects for non-mega deals, strategies for rising above the noise, and the challenges and opportunities for both biopharma CEOs and investors. Foley’s Antoinette Konski will be among the select group of panelists. The discussion will also cover the pre-seed and seed markets, offering valuable perspectives and networking opportunities to help you navigate this rapidly evolving sector and understand what’s happening beyond the headline-grabbing mega-deals.

Recent:

Policy Changes Impacting Boardrooms | March 4, 2025
Foley, alongside the NACD Northern California Chapter, recently hosted a virtual panel discussion to examine the impact of a new presidential administration and evolving state-driven regulations on corporate governance, regulatory compliance, and business strategy. The panelists discussed key topics, including the potential shift in corporate domiciles, SEC regulatory changes, state legal developments, and tariff and supply chain updates. Christine Gorjanc, along with Foley’s Ed Burbach, Patrick Daugherty, Louis Lehot, Christopher Swift, and Jessica Lochmann, shared valuable insights on these pressing issues.

Transforming AI Potential into Practical Business Impact | February 25, 2025
Foley hosted an exclusive executive roundtable at the Legacy Club in Boston bringing together top executives, industry leaders, and AI experts to discuss and develop actionable strategies for integrating AI into business operations. The roundtable provided a platform for insightful discussions on how to effectively implement AI, from initial setup to advanced applications. Attendees shared their experiences and insights, contributing to a deeper understanding of AI’s practical applications in the business world. After the program, participants enjoyed an exciting Boston Bruins game against the Toronto Maple Leafs. It was the perfect opportunity to unwind, network, and enjoy some great hockey action.

Hellenic Innovation Network of New York: Innovation & Impact | February 18, 2025
Foley partnered with the Hellenic Innovation Network in our New York office for an evening of Innovation & Impact. Attendees connected with innovators, business leaders, and changemakers. It was a great opportunity to network with leaders in innovation and investment and gain insights into key industry topics. The evening concluded with a reception where attendees connected with fellow participants.

ViVE Conference Cocktail Reception | February 17, 2025
Foley, alongside J.P. Morgan and Longitude Capital, was thrilled to cohost an exclusive happy hour event during the ViVE Digital Health Conference. The evening provided attendees with the opportunity to network with leaders in the Digital Health Industry, including founders, investors, and industry peers, while enjoying the vibrant sounds of downtown Nashville and a selection of exquisite cocktails and appetizers. It was a valuable occasion to elevate connections and gain insights into the future of healthcare technology.

Founders & Funders Truffle Making | February 11, 2025
Attendees enjoyed a sweet evening of networking and chocolate at the Founders & Funders Truffle Making event. Just in time for Valentine’s Day, the gathering provided an opportunity for entrepreneurs and investors to connect while indulging in the art of truffle-making at the delightful Dandelion Chocolate Factory in San Francisco. Following the class, guests made their way to the Paris-inspired Bloom Restaurant for more savory and sweet delights and hot chocolate. The event offered a perfect blend of business and pleasure, allowing participants to get creative with chocolate while building valuable connections.

Kauffman Fellow GP/LP Networking Reception | February 4, 2025
Foley had the privilege of attending the invite-only Kauffman Fellows GP/LP networking event in Half Moon Bay, kicking off the Women in VC conference. Held at the Ritz Carlton’s golf club, the gathering brought together top investors for an evening of high-impact networking and insights. The event featured a fireside chat with select Kauffman Fellow GPs, highlighting trends in venture capital and the network’s impressive track record — outperforming the industry with a 5.8x average realized multiple. Hosted by Jennifer Vancini and SC Moatti of Mighty Capital with support from Foley, the event reinforced key relationships shaping the future of venture investing.

Thought Leadership

Where is corporate venture capital headed in 2025, and will it lead to more M&A?
Corporate Venture Capital (CVC) investment is an increasingly used strategic tool that enables large corporations to make minority investments in startups that will complement and expand their existing products or services. This type of investment can be highly beneficial as it can provide strong financial returns, and access to innovation without the time and heavier expense load of in-house research and development (R&D) projects. This article was authored by Louis Lehot.
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Global M&A Trends: Spotlight on Japan
According to a recent KPMG report, the global M&A landscape in 2024 signals a rebound despite challenges like geopolitical tensions, high interest rates, and persistent inflation for much of the year. The dealmaking environment gained momentum in part due to inflation and interest rate pressures starting to ease towards the end of the year, the return of major lenders to acquisition finance markets, and technology advancements, particularly artificial intelligence (AI). This article was authored by Brian Wheeler.
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Introducing the EU AI Act
Understanding the need for regulation to ensure the safe use of AI, the European Union (EU) has introduced the world’s most comprehensive legal guideline, the EU AI Act, designed to impose strict requirements on AI systems operating within its jurisdiction. Its objectives are clear; however, its implementation and enforcement present challenges, and the debate around its impact on innovation continues to get louder. This article was authored by Natasha Allen.
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Newly Filed Legislation Positions Texas as a Leading State for Incorporations
On February 27, 2025, Senate Bill №29 was filed in the Texas Legislature to introduce a series of corporate reforms that aim to make Texas the preferred jurisdiction for legal domestication. This bill proposes a series of amendments to the Texas Business Organizations Code that would increase the certainty of how corporate decision-making is reviewed by the courts. This article was authored by David Cabrales, Christopher Converse, Christopher Babcock, John Sepehri, and Brandon Livengood.
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Deals

Foley Represents Men In Blazers Media Network in $15M Series A Funding
Foley & Lardner LLP represented Men In Blazers Media Network, a leading media network covering men’s and women’s soccer, domestic leagues, and international tournaments, in its $15 million Series A funding round. The round was led by Avenue Sports Fund, with additional investments from Bolt Ventures, RR McReynolds, The Chernin Group, Ryan Sports Ventures, and Wheelhouse.

Foley Represents East Bridge Capital as Investor in Series B Funding for Lumotive
Foley & Lardner LLP represented East Bridge Capital as an investor in the $45 million Series B funding round for Lumotive, a leader in programmable optical semiconductor products. Additional new investors included Swisscom Ventures, EDOM, Grazia, Hokuyo Inc., and TSVC, as well as existing investors such as Gates Frontier, MetaVC Partners, Quan Funds, USAA, and HiMax Inc.

Foley Advises Infotree Global Solutions in Investment from Kingswood Capital Management
Foley & Lardner LLP served as legal advisor to Infotree Global Solutions, a leading provider of international workforce management solutions, in its investment from Kingswood Capital Management.

Foley Represents Matterport in Acquisition by CoStar Group
Foley & Lardner LLP represented Matterport, the global leader in 3D digital twin technology, in its sale to CoStar Group, a leading provider of online real estate marketplaces, information, and analytics in the property markets. This acquisition brings together two industry pioneers to accelerate the adoption of AI-driven digital twin technology across the global real estate landscape.

Foley Represents LoftyInc Capital in $43M First Close of New Pan-African Seed Fund
Foley & Lardner LLP represented LoftyInc Capital Management in securing a $43 million first close for its new LoftyInc Alpha Fund, a late-seed investment vehicle aimed at scaling Africa’s most promising tech startups, particularly in Nigeria, Egypt, Kenya, and Francophone Africa. LoftyInc is one of Africa’s most established venture capital firms, with over a decade of experience backing startups such as Flutterwave, Andela, and Wave Mobile Money.