Term Sheet -- Tuesday, December 12
2018 CRYSTAL BALL
Good morning, Term Sheet readers.
Last December, Term Sheet released a list of your business predictions for 2017. I want to do the same this year.
Reply to this email with a one or two-sentence answer to the question: “What’s your top business-related prediction for 2018?” Feel free to give me your thoughts on everything from M&A trends to policy changes to when you think we’ll be driving our Teslas on Mars.
I will include highlights of your answers in an upcoming Term sheet.
Speaking of trends, Ernst & Young released its 2018 M&A sector outlook report today, and it had some interesting takeaways. Here are several key points that dealmakers should know:
• Companies rethink their competitive formula: Boards and C-suite executives face a number of challenges today, from activist shareholders to cybersecurity threats. As a result, more companies are beginning to implement more frequent and rigorous portfolio reviews, which focus on integrating previously executed deals and divesting businesses that no longer fit with the strategy.
• Tech M&A roars on: Technology companies are becoming attractive acquisition targets across all industries — from healthcare to retail to industrials. As the gap between traditional incumbents and new-gen tech behemoths widens, expect more re-invention and consolidation ahead.
• Private equity increases deal competition: Private equity has been making waves in the tech sector, and it is not slowing down. Since 2010, PE deal activity has tripled and almost 100% of the growth has been in M&A volumes. Flush with cash, PE firms are likely to challenge corporates for assets more than they have at any point in the past five years.
• Mega-deals are here to stay: Expect to see more massive cross-border deals as dealmakers get more comfortable doing business abroad.
THE LATEST FROM FORTUNE…
• Why Tesla wants a piece of the commercial trucking industry (by Kirsten Korosec)
• Amazon has ambitious, Amazon-like offline plans (by Adam Lashinsky)
• 3 things to know about how Bitcoin futures work (by Lucinda Shen)
• Big banks pour millions into Menlo Security (by Robert Hackett)
• San Francisco Mayor Ed Lee has died at 65 (by Natasha Bach)
…AND ELSEWHERE
Carl Icahn to launch new board fight with Xerox. The hottest ICOs are the ones that have done the least amount of work. Is Broadcom making a jobs promise it can’t fulfill? Audi CEO drops plan to sell Ducati.
VENTURE DEALS
• Affirm, Inc., a San Francisco-based provider of a platform that helps consumers find financing, raised $200 million in Series E funding. GIC led the round and was joined by Khosla Ventures, Lightspeed Venture Partners, Founders Fund, Spark Capital, Caffeinated Capital, and Ribbit Capital. Affirm’s valuation is estimated to be between $1.5 billion and $2 billion, according to The Wall Street Journal.
• Mafengwo, a China-based independent online travel platform, raise $133 million in Series D funding. Investors include General Atlantic, Ocean Link, Temasek, Yuantai Investment, and Hopu. Existing investors including Capital Today, Qiming Venture Partners, and Hillhouse Capital participated.
• Nextdoor, a San Francisco, Calif.-based neighborhood social networking site, raised approximately $75 million in funding at a reported $1.5 billion valuation. Read more.
• Aspiration, a Marina Del Rey, Calif.-based financial firm, raised $47 million in Series B funding. Social Impact Finance led the round, and was joined by investors including Allen and Company, Omidyar Network, Alpha Edison, AGO Partners, Reyl & Cie, and Capricorn Investments.
• Hookipa Biotech AG, an Austria-based clinical stage biotech company, raised $59.6 million in Series C funding. Investors include HBM Partners, Hillhouse Capital, Sirona Capital, Gilead, Sofinnova Partners, Forbion Capital Partners, Boehringer Ingelheim Venture Fund, Takeda Ventures and BioMedPartners.
• Creditas Soluções Financeiras Ltda, a Brazil-based fintech startup, raised 165 million reais ($50 million) in funding from Vostok Emerging Finance, according to Reuters. Read more.
• Ouster, a San Francisco, Calif.-based developer of high performance LIDAR, raised $27 million in Series A funding. Cox Enterprises led the round, and was joined by investors including Fontinalis Partners, Amity Ventures, Constellation Technology Ventures, Tao Capital Partners and Carthona Capital.
• Simility, a Palo Alto, Calif.-based provider of fraud prevention solutions, raised $17.5 million in funding. Accel led the round, and was joined by investors including PayPal Inc, The Valley Fund and Trinity Ventures.
• SevenRooms, a New York-based reservation, seating and guest management software for restaurants and hotels, raised $8 million in funding. Comcast Ventures led the round.
• Alchemy IoT, a Lafayette, Colo.-based provider of IoT asset intelligence for industrial applications, raised $4 million in seed funding. Investors include Aweida Venture Partners.
• Cog, an Australia-based cybersecurity software company, raised $3.5 million in Series A funding. Investors include Grok Ventures and rampersand.
• Clora, a Cambridge, Mass.-based medical tech startup, raised $3.3 million in seed funding. Spark Capital led the round, and was joined by investors including Social Capital, Ludlow Ventures, Notation Capital, iSeed Ventures, v1 VC and KohFounders.
• Slingshot Aerospace, a Lompoc, Calif.-based company utilizing artificial intelligence to provide geospatial information, raised $3.25 million in seed funding. Investors include Okapi Venture Capital, Sway Ventures, Stage and NoName Ventures.
• PullRequest, an Austin, Texas-based online code reviewing services company, raised $2.3 million in seed funding, according to TechCrunch. Investors include Gradient Ventures. Read more.
• Discngine, a Paris-based software company specializing in applications for life sciences research, raised $1.3 million in Series A funding from Extens Développement e-Santé.
• Alpin, a Boulder, Colo.-based provider of SaaS monitoring and management tools for IT administrators, raised $1 million in funding. Rockies Venture Club led the round and was joined by investors including Nebraska Angels, Plains Angels, Keiretsu Capital and Techstars.
• Heartbeat, a Santa Monica, Calif.-based two-way brand endorsement platform, raised $1 million in seed funding. Sinai Ventures led the round, and was joined by investors including Firebrand Ventures.
• Sequentum Inc, a San Jose, Calif.-based web data extraction and web automation software development company, raised funding of an undisclosed amount from WorldQuant Ventures.
HEALTH AND LIFE SCIENCES DEALS
• OncoTartis, a Buffalo, N.Y.-based developer of anti-cancer drugs, raised $6 million in funding. Investors include Norma Investments.
PRIVATE EQUITY DEALS
• EnCap Investments invested $300 million to Pegasus Resources LLC, a Fort Worth, Texas-based mineral and royalty company.
• Eurazeo is in exclusive talks with French investment group IDI to take a 51% stake in Idinvest, a Paris-based mid-cap private equity firm. The deal could value the group at around 300 million euros ($353 million).
• Blue Equity acquired a majority stake in Napoli Management Group, a Beverly Hills, Calif.-based news talent agency. Financial terms weren’t disclosed.
• Vista Equity Partners acquired Datto, a Norwalk, Connecticut-based provider of data protection solutions for businesses. Financial terms weren’t disclosed. Vista has merged Datto with portfolio company Autotask.
• The Carlyle Group made an undisclosed investment in Prime Clerk, a New York-based claims and noticing administrator.
• North Branch Capital, LLC made an investment in Randazzo Mechanical Heating & Cooling, LLC, a Macomb, Mich.-based provider of non-discretionary, residential heating, ventilation and air conditioning replacement and maintenance services. Financial terms weren’t disclosed.
OTHER DEALS
• Atos offered to buy Gemalto (ENXTAM:GTO) for 4.3 billion euros ($5.06 billion), according to Reuters. Read more.
• Velocity Technology Solutions acquired Mercury Technology Group, an Irvine, Calif.-based cloud service provider. Financial terms weren’t disclosed.
IPOs
Reliance Jio Infocomm, an Indian mobile operator, is considering an IPO as soon as late 2018, according to sources cited by Bloomberg. India’s richest man, Mukesh Ambani backs the company. The company may be valued at 500 billion rupees to 700 billion rupees ($7.8 billion to $10.9 billion). Read more.
EXITS
• Safe Fleet, a portfolio company of The Sterling Group, acquired MobileView, a provider of mobile surveillance and video management solutions to buses and trains in the U.S. The seller was Interlogix. Financial terms weren’t disclosed.
• ConversionPoint Technologies Inc acquired Sellpoints Inc, an Emeryville, Calif.-based e-commerce tech provider. Financial terms weren’t disclosed. Sellpoints had raised approximately $22.1 million in venture funding from investors including Menlo Ventures, Granite Ventures and IBM.
• Charming Charlie LLC, a Houston, Texas-based fashion jewelry chain, filed for Chapter 11 bankruptcy and entered into a restructuring agreement with lenders and equity sponsors, according to Reuters. Charming Charlie had raised approximately $90 million in venture funding from investors including Hancock Park Associates. Read more.
• The Riverside Company sold Outward Hound, a Centennial, Ohio-based designer and distributor of pet toys and accessories, to J.W. Childs. Financial terms weren’t disclosed.
• Graycliff Partners LP sold Talon Innovations Corporation, a Sauk Rapids, Minn.-based provider of high precision machining primarily to the semiconductor equipment market, to Ichor Holdings, LLC. Financial terms weren’t disclosed.
FIRMS + FUNDS
• Navitas Capital, a Beverly Hills, Calif.-based venture firm, raised $60 million for its new fund. Read more.
PEOPLE
• Scale Venture Partners named Eric Anderson as a principal. Previously, Anderson was at Google.
• Nader Abadi joined Monroe Capital as an associate.
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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.
