Apr 10, 2018

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

Photo illustration: Axios visuals

Former Twitter COO and ex-Goldman banker Anthony Noto just finished his first month on the job as CEO of SoFi, the "unicorn" financial services company whose founding CEO was booted late last year after misconduct allegations.

Noto and I recently chatted about the new job, leaving the old job, recruiting (SoFi yesterday added Michelle Gill as CFO), expansion plans and competing with Goldman Sachs.

We also discussed fundraising, with Noto denying conventional wisdom on SoFi's IPO plans:

"I’m not aware of any specific plans the company had in terms of a timetable for going public. I think there was a lot of hearsay around that. In 2018 an IPO was not a priority. In terms of fundraising, we are well capitalized. It’s one of our strengths. We have no plans nor need to raise capital this year."

Full interview with Noto here.

First among equals: Axios' Bob Herman writes that Walmart-Humana is the healthcare mega-merger to watch, because "it targets the spending power of the aging population."

Update: A source tells Axios that Uber's deal for e-bike sharing startup Jump is worth $200 million in cash plus management earn-0uts.

ICYMI: Cryptocurrency company Ripple recently donated $29 million to fully fund every single one of the 35,000+ classroom projects posted by schoolteachers on DonorsChoose.org. No matter what you think of crypto, this is simply amazing.

Fund scoop: Kia reports that Conductive Ventures, formed by Paul Yeh (ex-Kleiner Perkins) and Cary Lai (ex-Intel Capital), has closed its debut fund with $100 million. Key

  • Why it matters: Conductive is focused on the Series B funding gap, which has widened as firms move earlier or later in the capital cycle.
  • Origin story: Lai and Yeh have been friends since their earliest post-college days, sharing a SoMa apartment with Kabam co-founder and ex-CEO Kevin Chou.
The BFD
Source: Giphy

Francisco Partners has agreed to buy payments and commerce technology company Verifone (NYSE: PAY) for around $3.4 billion (including nearly $850m of debt), or $23.04 per share (54% premium over Monday's closing price).

  • Why it's the BFD: Because this is a very high-stakes turnaround, as Verifone shares closed yesterday at their lowest level since late 2009.
  • Timeline: The deal includes a "go-shop" period that expires on May 24.
  • Other parties: British Columbia Investment Management is joining Francisco on the buyside, while Qatalyst Partners represented Verifone. Prior Verifone owners include buyout firms Gores Group and GTCR.
  • Bottom line: "VeriFone, whose point-of-sale card readers are retail staples, has struggled with delays in transitioning to chip-card technology in the U.S. as a lengthy certification processes for the new payment terminals delayed domestic sales. The firm also faces increased competition from Silicon Valley upstarts such as Square." — Bloomberg
Venture Capital Deals

🚑 Alan, a French health insurance startup, raised $28.3 million in Series A funding. Index Ventures led, and was joined by Xavier Niel and seed backers CNP Assurances, Partech and Portag3 Ventures. http://axios.link/S2u0

Directly, a Palo Alto, Calif.-based “AI for customer service” startup, raised $20 million in Series B funding. Northgate led, and was joined by Microsoft and return backers Costanoa Ventures and True Ventures. www.directly.com

Expel, a Herndon, Va.-based managed security startup, raised $20 million in Series B funding. Scale Venture Partners led, and was joined by Battery Ventures, Greycroft, Lightbank, NEA, Paladin Capital Group and Profile Capital Management. www.expel.io

Holberton School, a two-year coding school, raised $8.2 million in Series A funding from Daphni, Trinity Ventures and Omidyar Network. http://axios.link/nNN9

Eporta, a London-based B2B interior decorating marketplace, raised $8 million in Series A funding. Canvas Ventures led, and was joined by LocalGlobe, Oxford Capital Partners, Talis Capital and Samos Ventures. http://axios.link/7XMl

🚑 Nutrino, an Israel and San Francisco-based provider of nutrition-related data services and analytics, raised $8 million in Series A funding from Pereg Ventures, Nielsen Ventures and Gandyr Group. www.nutrinohealth.com

TVSquared, a Scotland-based provider of TV performance analytics and optimization solutions, raised $8 million in new funding. West Coast Capital led, and was joined by Scottish Investment Bank. www.tvsquared.com

Chargifi, a London-based wireless power charging platform, raised $7 million in new funding. Accelerated Digital Ventures led, and was joined by HP Enterprise and Firstminute Capital. www.chargifi.com

Nexford University, a Washington, D.C.-based online provider of workforce education, raised $4 million in seed funding from backers like Magnify Ventures. www.nexford.com

Primal Pantry, a British maker of paleo protein bars, raised £3 million from NVM Private Equity. http://axios.link/jzO5

Juro, a British sales contract simplification startup, raised $2 million in seed funding led by Point Nine Capital. http://axios.link/kW9t

Karamba Security, an Israel and Michigan-based provider of automotive cybersecurity prevention solutions, raised $10 million in venture debt funding from Western Technology Investment. www.karambasecurity.com

Private Equity Deals

Ant Financial, the financial services unit of Alibaba, is raising $9.5 billion in new private funding at around a $150 billion valuation, per the WSJ. http://axios.link/Jwuy

Clearlake Capital has acquired Wheel Pros, a Lakewood, Colo.-based maker of auto aftermarket wheels, performance tires and accessories. www.wheelpros.com

Connexeo, a Minneapolis-based SaaS platform for education and community organizations, raised $110 million in growth equity funding from Great Hill Partners. www.connexeo.com

Conterra Networks, a Charlotte-based portfolio company of Court Square Capital Partners, has acquired Louisiana regional fiberoptic network services businesses Network USA and Sun America Communications. www.conterra.com

• EQT Infrastructure has acquired a majority stake in Spirit Communications, a Columbia, S.C.-based fiber network operator, and merged it with existing portfolio company Lumos Networks. www.spiritcom.com

ProAmpac, a Cincinnati-based packaging company owned by Pritzker Group Private Capital, has acquired Pactech, a Rochester, N.Y.-based pouch converting manufacturer. www.pactechpackaging.com

Public Offerings

Carbon Black, a Waltham, Mass.-based maker of endpoint security software, has filed for a $100 million IPO. It plans to trade on the Nasdaq under ticker CBLK with Morgan Stanley listed as lead underwriter. The company reports a $56 million net loss on $162 million in revenue for 2017, and raised more than $230 million in funding from firms like Accomplice (17% pre-IPO stake), Highland Capital Partners (14.9%), Sequoia Capital (9.9%), Kleiner Perkins (8.8%), .406 Ventures (7.7%) and The Blackstone Group.

Domo, a Utah-based data management and analytics company, has picked Morgan Stanley to lead its upcoming IPO, sources tell Axios.

Huya Broadcasting, a Chinese e-sports video platform being spun out of YY (Nasdaq: YY), has filed for a $200 million IPO. http://axios.link/NvgX

People’s Insurance Group of China (HK: 1339), owner of China’s largest non-life insurer, is prepping a Shanghai float that could raise more than $1.6 billion. http://axios.link/bR6b

⛽ Sinochem Group of China has picked banks for a $2 billion Hong Kong IPO for its key oil assets, according to Reuters. http://axios.link/JBjs

Zuora, a Foster City, Calif.-based provider of subscription billing software, increased its IPO pricing terms from $9-$11 to $11-$13. It still plans to offer 10 million shares, and trade on the NYSE under ticker ZUO with Goldman Sachs as lead underwriter. Zuora has raised around $250 million in funding from backers like Benchmark (11.1% pre-IPO stake), Wellington Management (9.4%), Shasta Ventures (8.3%), Tenaya Capital (6.6%) and Redpoint Ventures (6.5%).

More M&A

• Bayer has received DoJ approval for its pending $62.5 billion buyout of Monsanto (NYSE: MON), per the WSJ. http://axios.link/vdWp

BNP Paribas has agreed to acquire the Polish banking unit of Raiffeisen Bank for €775 million. http://axios.link/TZM3

L’Oreal (Paris: OREP) has been picked as the preferred bidder for a 70% stake in South Korean cosmetics and fashion firm Nanda, in a deal that could be worth around $375 million, per a local media report. http://axios.link/aJjT

• Nike (NYSE: NKE) has agreed to buy Israeli computer vision company Invertex. http://axios.link/8lmW

• Tenneco (NYSE: TEN) has agreed to acquire Federal-Mogul, a Southfield, Mich.-based maker of powertrain components, from Icahn Enterprises for $5.4 billion in cash and stock. http://axios.link/Z0a5

Fundraising

Atlas Holdings of Connecticut has closed its third private equity fund with nearly $1.7 billion in capital commitments. www.atlasholdingsllc.com

🚑 Frazier Healthcare Partners has closed its second healthcare-focused buyout fund with $780 million in capital commitments. www.frazierhealthcare.com

Montana Capital Partners of Switzerland has closed its fourth private equity secondaries fund with €800 million. www.montana-capital-partners.eu

It's Personnel

David Bard has joined The Halifax Group as a managing director. He previously was a principal with American Securities. www.thehalifaxgroup.com

• VT Bharadwaj tweeted that he is stepping down as a managing director with Sequoia Capital India, but that he will remain on his current portfolio company boards. No word yet on future plans.

Rachel Horwitz has stepped down as VP of communications at Spark Capital to join Coinbase as head of communications. http://axios.link/Xu7j

Todd Jackson, a former product manager with Dropbox and Twitter, has joined First Round Capital as a “founder-in-residence.” www.firstroundcapital.com

Final Numbers
Dan Primack