23 hours ago

Axios Pro Rata

Top of the Morning

Illustration: Aïda Amer/Axios

The IPO market is doing its best Alfred E. Neuman impression so far this week, refusing to entertain everyone else's worries

Big picture: Both the Dow and S&P 500 fell nearly 2% yesterday, as investors tried to measure the fallout of Chinese construction giant Evergrande defaulting on its $300 billion in liabilities.

  • As Axios' Felix Salmon writes: "It's not a Lehman moment but it's still a very big deal."
  • Plus the continuing spread of COVID, the end of extended unemployment benefits, the debt limit absurdity and the uncertain fate of President Biden's infrastructure and reconciliation plans.

As everything else wobbles, the IPO pipeline is holding firm.

  • FreshWorks and Toast yesterday both increased their IPO price terms, and now could raise a combined $1.7 billion.
  • Universal Music made its stock market debut in Amsterdam, after being spun off by Vivendi, with shares jumping around 40% at the open.

IPO bankers are obviously keeping a close eye on macro tumult, but aren't yet advising issuers to tap the brakes. Particularly without at least a weeklong market rout.

  • October has what one IPO adviser referred to as "a bumpy market history," which means that companies have already been primed for rough waters.
  • Companies are loathe to postpone public offerings, both because of implicit promises to employees and because of financial plans that include IPO proceeds and ancillary benefits (i.e., public currency for hiring and acquisition).

The bottom line: We're still expecting nearly 100 more U.S. public offerings in 2021, with a traffic jam that extends well into 2022.

The BFD

Illustration: Aïda Amer/Axios

Sorare, a French fantasy soccer platform whose "cards" are non-fungible tokens registered on the Ethereum blockchain, raised $680 million in Series B funding at a $4.3 billion valuation led by SoftBank Vision Fund 2.

  • Why it's the BFD: This is the largest-ever VC deal for a company in the NFT space, which either will prove to be Bitcoin circa 2013 or pet rocks circa 1975.
  • Other investors include Atomico, Bessemer Ventures, D1 Capital, Eurazeo, IVP and Liontree.
  • The bottom line: A big differentiator for Sorare, and a reason for the huge raise, is the company buys exclusive rights from soccer clubs like Real Madrid and Juventus. It also differs from "traditional" NFT startups in that it's focused on fantasy sports, which is inherently transitory, rather than on collectibles.
Venture Capital Deals

Fivetran, an Oakland-based provider of automated data integration solutions, raised $565 million in Series D funding at a $5.6 billion valuation. Andreessen Horowitz led, and was joined by Iconiq, D1 Capital Partners, YC Continuity and insiders General Catalyst, CEAS Investments and Matrix Partners. www.fivetran.com

Airwallex, an Australian cross-border payments business, raised $200 million in Series E funding at a $4 billion valuation. Lone Pine Capital led, and was joined by insiders 1835i Ventures, DST Global, Salesforce Ventures and Sequoia Capital China. http://axios.link/TAHM

Lightricks, maker of Facetune and other photo and video editing apps, raised $130 million in Series D funding ($100M primary). Insight Partners and Hanaco VC co-led, and were joined by Migdal Insurance, Altshuler Shaham and Shavit Capital. Existing investors Goldman Sachs Asset Management, Clal Tech, Harel Insurance and Finance and Greycroft. http://axios.link/JNBv

TrueLayer, a London-based API platform for open banking, raised $130 million at a valuation north of $1 billion. Tiger Global led, and was joined by Stripe. http://axios.link/DCmN

🚑 IVX Health, a Nashville-based operator of outpatient infusion centers, raised $100 million in Series F funding from Great Hill Partners. www.ivxhealth.com

Sendoso, an SF-based corporate gifting platform, raised $100 million in Series C funding. SoftBank Vision Fund 2 led, and was joined by insiders Oak HC/FT, Struck Capital, Stage 2 Capital, Craft Ventures, Signia Venture Partners and Felicis Ventures. http://axios.link/ReEu

Battery Resourcers, a Worcester, Mass.-based developer of lithium-ion battery materials, raised $70 million. Hitachi Ventures led, and was joined by Orbia Ventures, Jaguar Land Rover, Doral Energy, At One Ventures, TDK Ventures and Trumpf Venture. http://axios.link/IE8H

🚑 Ventyx Biosciences, an Encinitas, Calif.-based biotech focused on autoimmune and inflammatory conditions, raised $51 million in Series B funding. Surveyor Capital led and was joined by insiders VenBio Partners and OrbiMed. http://axios.link/R0Zd

Statespace, a New York-based gaming startup that aims to aid in neuroscience, raised $50 million co-led by insiders Khosla Ventures and Lux Capital. Other backers include FirstMark Capital, June Fund, West Ventures, AME, Bessemer Venture Partners, Modern Venture Partners, Mirae Asset, Animal Capital, Riverside and Gaingels. http://axios.link/ZsTr

Intenseye, a provider of video analytics for employee health and safety, raised $25 million in Series A funding. Insight Partners led, and was joined by insiders Point Nine and Air Street Capital. www.intenseye.com

Propel, a Santa Clara, Calif.-based product lifecycle management platform raised $20 million in Series C funding. Salesforce Ventures led, and was joined by Ankona Capital and insiders Norwest Venture Partners, Cloud Apps Capital Partners, Green D Ventures and TIFF. www.propelplm.com

Stairwell, a Santa Clara, Calif.-based cybersecurity startup, raised $20 million co-led by Accel and Sequoia Capital. http://axios.link/uRcH

Mutiny, an SF-based provider of website personalization tools for B2B brands, raised $18.5 million in Series A funding. Sequoia Capital led, and was joined by insiders Cowboy Ventures and Uncork Capital. http://axios.link/LDsn

Boom Entertainment, a New York-based maker of sports gaming apps, raised $15 million. Sands Capital led, and was joined by Bob Kraft, Jim Murrenn, Golden Nugget, Rush Street, TEGNA and Defy Partners. http://axios.link/wLPW

Cloudsmith, an Irish supply chain management software startup, raised $15 million in Series A funding. Tiger Global led, and was joined by Shasta Ventures, Amaranthine, Sorenson and Leadout Capital. www.cloudsmith.com

DeepFactor, a San Jose, Calif.-based maker of continuous AppSec observability tools, raised $15 million in Series A funding. Insight Partners led, and was joined by Tricentis, Emergent Ventures and Security Leadership Capital. www.deepfactor.io

Metrika, a Cambridge, Mass.-based operational intelligence startup for blockchain, raised $14 million in Series A funding. Neotribe Ventures led, and was joined by Coinbase Ventures, Samsung NEXT, Nyca Partners and SCB 10X. www.metrika.co

🚀 Near Space Labs, a New York-based geospatial intelligence startup, raised $13 million in Series A funding. Crosslink Capital led, and was joined by Toyota Ventures, Leadout Capital and Wireframe Ventures. http://axios.link/nLJ9

Blackbird.ai, a New York-based disinformation intelligence platform, raised $10 million in Series A funding. Dorilton Ventures led, and was joined by NetX, Generation Ventures, Trousdale Ventures, StartFast Ventures and Richard Clarke. http://axios.link/k2fD

Gardyn, a Washington, D.C.-based homegrown food tech startup, raised $5 million from JAB Ventures. www.mygardyn.com

Cartona, an Egyptian platform for connecting retailers and manufacturers, raised $4.5 million in seed funding. Global Ventures led, and was joined by Kepple Africa and T5 Capital. http://axios.link/AwTt

Assembly, a Culver City, Calif.-based ecommerce software and data platform, raised an undisclosed amount of growth equity funding at a valuation north of $1 billion. Advent International led, and was joined by PSG. www.withassembly.com

MarketFinance, a British lending platform for SMBs, raised £280 million. Most of it is debt led by Italy's Intesa Sanpaolo, while Black River Ventures led an equity tranche. http://axios.link/YJTQ

Private Equity Deals

📺 Apollo Global Management and Standard General bid more than $8 billion to buy local TV station owner Tegna (NYSE: TGNA), per the NY Post. http://axios.link/n9d6

AnaCap Financial Partners is spinning out an internal data analytics group focused on debt, equity and real estate investments. http://axios.link/IXye

Ardian acquired a majority stake in Florida Food Products, a Eustice, Fla.-based clean label ingredients firm, from MidOcean Partners (which retains a minority stake). www.floridafoods.com

🚑 Audax Private Equity acquired a majority stake in GCX Mounting Solutions, a Petaluma, Calif.-based maker of healthcare-focused equipment mounting and mobility solutions. www.gcx.com

Bain Capital is in talks to buy a portfolio of leasing contracts from Greek lender Piraeus Bank, per Reuters. http://axios.link/fVU9

Bregal Partners invested in Oggi Foods, a Montreal-based "better-for-you" frozen foods company. www.oggifoods.com

CI Capital Partners acquired a majority stake in Cadmus, a Waltham, Mass.-based environmental consultancy whose backers included Enlightenment Capital. www.cadmusgroup.com

Great Hill Partners invested in Blue Ridge, an Atlanta-based supply chain planning and price optimization platform. www.blueridgeglobal.com

Peak Rock Capital invested in Delta Financial Group, a Clearwater, Fla.-based equipment finance platform. www.leasedelta.com

StepStone Group completed its previously announced acquisition of Greenspring Associates. http://axios.link/sg1w

Turnspire Capital Partners agreed to buy the assets of Spectra Premium Industries, a Quebec-based maker of aftermarket auto parts. www.spectrapremium.com

Public Offerings

Allvue Systems, a Coral Gables, Fla.-based investment management software firm owned by Vista Equity Partners, set IPO terms to 15.3 million shares at $17–$19. It would have a $1.7 billion fully diluted valuation, were it to price in the middle, plans to list on the NYSE (ALVU) and reports a $21 million net loss on $71 million in revenue for the first half of 2021. http://axios.link/yejV

Olaplex, a Santa Barbara, Calif.-based hair products company owned by Advent International, set IPO terms to 67 million shares at $14–$16. It would have a $10.4 billion fully diluted value, were it to price in the middle, plans to list on the Nasdaq (OLPX) and reports $95 million of net income on $270 million in revenue for the first half of 2021. http://axios.link/aHLM

Liquidity Events

🚑 Novartis (NYSE: NVN) acquired Arctos Medical, a Denver-based gene therapy firm focused on sight loss that had raised around $8 million in VC from firms like Novartis Ventures and ND Capital. http://axios.link/NHK2

Riata Capital Group sold Gardena, Calif.-based WSS, a Hispanic-focused athletic footwear retailer, to Foot Locker (NYSE: FL) for $750 million. http://axios.link/ALUN

SPAC Stuff

Transfix, a New York-based digital freight platform, agreed to go public at an implied $1.1 billion valuation via G Squared Ascend (NYSE: GSQD), a SPAC formed by G Squared Capital. Transfix had raised over $140 million from firms like G Squared, Canvas Ventures, NEA, TriplePoint Venture Growth, Lerer Hippeau Ventures, Charge Ventures and Corigin Ventures. www.transfix.io

More M&A

Royal Dutch Shell (NYSE: RDS) agreed to sell its Permian Basin assets in the prolific to ConocoPhillips (NYSE: COP) for $9.5 billion. Axios' Ben Geman writes:

  • This is the latest of several big deals bringing consolidation to the U.S. shale sector, including ConocoPhillips buying Concho Resources and Chevron buying Noble Energy.
  • Shell has said its oil production likely peaked in 2019 and will slowly decline annually as it diversifies.

DAZN is in talks to buy BT’s (LSE: BT) sports television unit, per Reuters. http://axios.link/wPE5

Drake acquired a stake in Dave's Hot Chicken, an L.A.-based restaurant chain. No word yet on if there will be Canadian expansion rebranded as Drake's Hot Chicken. http://axios.link/yKf3

🚑 HCA (NYSE: HCA) agreed to buy five Utah hospitals from Dallas-based Steward Health Care. http://axios.link/5zX8

National Express (LSE: NEX) is in talks to buy rival British bus operator Stagecoach Group (LSE: SGC) for £455 million in stock. http://axios.link/rINy

🥃 Pernod Ricard (Paris: RI) agreed to buy online spirits retailer Whisky Exchange. http://axios.link/Ucux

US Bancorp (NYSE: USB) agreed to buy the U.S. consumer banking arm of Mitsubishi UFJ Financial Group (Tokyo: 8306) for $8 billion in cash ($5.5b) and stock. http://axios.link/GxFo

🚑 Walgreens Boots Alliance (Nasdaq: WBA) agreed to pay $970 million for a majority stake in Shields Health Solutions, a Stoughton, Mass.-based specialty pharmacy services firm. Walgreens had previously acquired a minority stake in 2019, alongside an investment from Welsh, Carson and Anderson & Stowe (which will retain a stake). www.shieldshealthsolutions.com

Fundraising

Blue Bear Capital raised $150 million for its second VC fund focused on AI-powered solutions for energy, infrastructure and climate. LPs include Goldman Sachs Asset Management, Rockefeller Brothers Fund and the McKnight Foundation. www.bluebearcap.com

Heartcore Capital, a Copenhagen-based VC firm, raised $200 million for its fourth flagship fund and $50 million for an opportunity fund. www.heartcore.com

Liberty Strategic Capital, the private equity firm led by former U.S. Treasury Secretary Steve Mnuchin, secured around $2.5 billion for its debut fund, as first reported by Bloomberg. It continues to fundraise, per sources, so this isn't a final close. http://axios.link/6DK7

Partners Group raised $6 billion for its fourth flagship direct PE fund, and $9 billion via separately managed accounts. www.partnersgroup.com

It's Personnel

Matt Bocci, former director of biz dev and strategic partnerships at Atom Finance, joined Amity Ventures. www.amity.vc

Brian Duffy, former president of cloud for SAP, joined Warburg Pincus as a tech-focused senior adviser. http://axios.link/uv8u

Peter Gajdoš joined Fifth Wall to co-lead its climate tech investment team. He previously was with Presidio Partners. www.fifthwall.com

Rob Toews (ex-Highland Capital) joined Radical Ventures, a Toronto-based AI-focused firm, as its first Bay Area partner. www.radical.vc

JP Van Arsdale stepped down as a partner with Glade Brook Capital Partners, to become a general partner with BAM Elevate. www.bamfunds.com

Final Numbers
Expand chart
Data: SPAC Research; Chart: Axios Visuals

The great SPAC softening has led to an uptick in sponsors getting anchor investors for their IPOs, often at very favorable terms, Axios' Kia Kokalitcheva writes.

  • It's worrying some investors, who view these deal sweeteners as a telltale sign of lower quality offerings.
  • So far in September, anchor commitments represent more than half of all SPAC capital raised, per SPAC Research.

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