February 02, 2024

Top of the Morning

Illustration: Aïda Amer/Axios. Photos: Chip Somodevilla/Getty Images, Mandel Ngan/AFP

Joe Biden notched another economic win today with a boffo jobs report, while Donald Trump reiterated that he wouldn't renominate Fed chair Jay Powell because of a (baseless) claim that any 2024 rate cuts would be politically motivated.

  • Neither man is likely to acknowledge economic agreement with the other, but there is at least one area of common cause: Antitrust enforcement.
  • Both have a demonstrated antipathy toward big business getting bigger via acquisition, and a willingness to use government levers to stop it from happening.

The big picture: Antitrust regulators will continue to be emboldened, no matter who wins in November, much to the chagrin of dealmakers.

  • The Biden administration has taken a very broad view of anti-competitive behavior, and is on a bit of a winning streak after several legal losses. Even some of its defeats could be viewed as victories, if only because they created costs that discouraged others from signing merger agreements in the first place.
  • The Trump administration had a number of high-profile antitrust battles of its own, and the former president this week said he'd block Japan's Nippon Steel from buying Pittsburgh-based U.S. Steel. In short, he's a far cry from the free-market capitalism that used to dominate Republican politics.

Elsewhere: European antitrust regulators also have adopted a tougher posture, as evidenced by the Amazon-iRobot situation, which would persist regardless of the U.S. election outcome.

The bottom line: Per usual, this will be the most important election of our lives. But, if antitrust is what animates you, it'll be a snoozer.

The BFD

Illustration: Brendan Lynch/Axios

Heart Aerospace, a Swedish developer of short-range, hybrid-electric airplanes, raised $107 million in Series B funding.

Why it's the BFD: This could be a big step toward decarbonizing air travel, plus to restoring regional routes that have been idled due to unsustainable economics.

  • Several other companies also are working on hybrid planes.

Investors include Air Canada, Breakthrough Energy Ventures, European Innovation Council Fund, EQT Ventures, Lower Carbon Capital, Norrsken VC, Sagitta Ventures, United Airlines, and Y Combinator.

The bottom line: "Heart Aerospace has 250 orders for the ES-30, with options and purchase rights for an additional 120 planes. The company also has letters of intent for 191 more aeroplanes. ... The ES-30 is currently the only clean sheet hybrid-electric aeroplanes of its size with an active type certification application with the European Union Aviation Safety Agency." — Cate Lawrence, Tech.eu

Venture Capital Deals

Splash, a Denver-based real-money fantasy sports startup, raised $14.1m in Series A2 funding from Boston Seed, Velvet Sea Ventures, K5, Elysian Park, Acies Investments, Accomplice, and Counterview. https://axios.link/3SGaDtu

Podcastle, a podcasting platform, raised $13.5m in Series A funding. Mosaic Ventures led, and was joined by RTP Global, Point Nine Capital, Sierra Ventures, and AI Fund. https://axios.link/4bjz47l

Cube.Exchange, a hybrid crypto trading platform, raised $12m in Series A funding. 6th Man Ventures led, and was joined by GSR Markets, ParaFi Digital, Susquehanna Private Equity Investments and Everstake Capital. https://axios.link/480Z70f

CitySwift, a Scottish transit scheduling platform, raised €7m. Gresham House Ventures led, and was joined by Irelandia Investments, the Western Development Commission, and ACT VC. https://axios.link/3SlF72v

Aquaconnect, an Indian aquaculture startup, raised $4m led by S2G Ventures. https://axios.link/3Ovw0LE

Fora, a developer of AI for C-suite execs, raised $3.8m in pre-seed funding led by Converge VC. www.fora.day

Coris, a Palo Alto, Calif.-based provider of SMB risk infrastructure software, raised $3.7m in seed funding. Lux Capital and Exponent Founders Capital co-led, and were joined by Blank Ventures and YC. https://axios.link/482ETDf

AlensiaXR, a Cleveland-based provider of anatomical instruction software, raised $3m in Series A funding led by Sopris Capital. www.AlensiaXR.com

Finvest, an SF-based app for investing in U.S. treasuries, raised $2.7m from Bayhouse Capital, Unpopular Ventures, YC, Olive Tree Capital, Pioneer Fund, and Fractal Ventures. https://axios.link/3HCwjjX

Izote Biosciences, an SF-based fermentation startup, raised $2.6m in pre-seed funding. Embark Ventures and EGB Capital co-led, and were joined by Bee Partners, FTW Ventures, Nucleus Capital, Courtyard Ventures, Climate Capital Bio, and Redstick Ventures. https://axios.link/42lBv52

Private Equity Deals

Ahead, a Chicago-based portfolio company of Berkshire Partners, acquired New York-based IT services firm CDI from One Equity Partners. www.ahead.com

Barclays (LSE: BARC) is speaking with PE firms about buying a majority stake in its British merchant payments unit, after talks with strategics were unsuccessful, per Reuters. https://axios.link/47TLTCo

Blackhawk Network, a Pleasanton, Calif.-based portfolio company of Silver Lake and P2 Capital Partners, agreed to acquire Seattle-based digital B2B rewards startup Tango Card, which had raised more than $65m from VC backers like FTV Capital, Floodgate and Innovation Endeavors. www.blackhawknetwork.com

🚑 BlackRock and Memorial Hermann Health System invested in Lone Peak Dental Group, a Denver-based pediatric dental support org. www.lonepeakdentalgroup.com

EverSmith Brands, a Charlotte-based portfolio company of The Riverside Co., acquired U.S. Lawns, a franchised provider of commercial landscaping and snow removal services. www.eversmithbrands.com

Francisco Partners completed its purchase of IBM's (NYSE: IBM) weather business, including consumer-facing Weather Company assets like Weather.com. https://axios.link/3HMtvkh

OpenGate Capital completed its C$155m buyout of Player One Amusement Group, a Toronto-based amusement services provider, from Canada's Cineplex (TSE: CGX). https://axios.link/46vomHi

Public Offerings

🚑 Alto Neuroscience, a Los Altos, Calif.-based developer of psychiatry drugs, raised $129m in its IPO. The company priced 8m shares at $16, versus plans to offer 6.7m shares at $14-$16. It will list on the NYSE (ANRO), and had raised around $147m from firms like Alpha Wave Ventures (17.8% stake), Lightswitch Capital, and InVivium Capital. https://axios.link/3U1BNfn

🚑 Fractyl Health, a Lexington, Mass.-based developer of therapies for Type 2 diabetes and obesity, raised $110m in its IPO. The company priced in the middle of its $14-$16 range, representing a $714m market cap, and will list on the Nasdaq under ticker symbol GUTS. Fractyl has raised over $300m in VC funding from Mithril (15.8% pre-IPO stake), General Catalyst (12.7%), Bessemer Venture Partners (12.4%), Domain Associates (10.4%), and Crown Venture Fund (10.3%). https://axios.link/4bgWxWQ

🚑 Kyverna Therapeutics, an Emeryville, Calif.-based developer of cell therapies for autoimmune diseases, set IPO terms to 11.1m shares at $17-$19. It would have a $731m fully diluted value, were it to price in the middle, and plans to list on the Nasdaq (KYTX). The Phase 2 company raised around $177m in VC funding from Westlake Village BioPartners (17.1% pre-IPO stake), Vida Ventures (17.1%), Gilead (12.2%), Bain Capital Life Sciences (10.3%), Northpond Ventures (10.6%), RTW Investments (5.3%), Insight Partners, CAM Capital, LYFE Capital, and jVen Capital. https://axios.link/3HIg9W9

Greece's government raised around €785m via its float of a 30% stake in Athens International Airport. https://axios.link/3UqC6AC

XCHG, a Chinese provider of EV fast chargers, filed for a $50m IPO. It plans to list on the Nasdaq (XCH) and reports $38m in revenue for the year ending Sept. 2023. Backers include GGV Capital (11.6% pre-IPO stake), Shell Ventures (10.4%), and Zhen Partners (7.1%). https://axios.link/3w6IkLI

Liquidity Events

Brentwood Associates sold Parchment, a Scottsdale, Ariz.-based academic and professional credentials management company, to Instructure (NYSE: INST) for $835m. www.parchment.com

More M&A

BAE Systems (LSE: BA) acquired Malloy Aeronautics, a British maker of heavy-lift drones. https://axios.link/3Umt87l

Elliott Management has built a 13% stake in Etsy (Nasdaq: ETSY), making it the craft marketplace's largest outside shareholder, per Bloomberg. https://axios.link/3SKG99P

Sanlam, a listed South African insurer, paid around US$349m for smaller rival Assupol Life. https://axios.link/42rKEsM

Superdry (LSE: SDRY), a British fashion retailer, said it's seeking a cash offer for the 69% stake not held by CEO Julian Dunkerton. https://axios.link/482Wgnx

Fundraising

Basis Set, a Menlo Park, Calif.-based VC firm, raised $185m for its third fund. https://axios.link/3Sky5uV

Bramalea Partners, a Boston-based expansion capital firm focused on consumer tech and software, is raising $50m for its second fund, per an SEC filing. www.bramaleapartners.com

MaC Venture Capital is raising its third flagship fund and its first select fund, per SEC filings. www.macventurecapital.com

Practica Capital, a Lithuanian VC firm, raised €80m for its latest fund. https://axios.link/48TzDTR

It's Personnel

Brookfield Asset Management named Anuj Ranjan as CEO of the firm's private equity business, with Cyrus Madon transitioning to a new role as exec chairman of PE. https://axios.link/494XS1u

Elliott Management promoted Nabeel Bhanji, Jason Genrich, and Marc Steinberg to partners. https://axios.link/4bkCk26

Final Numbers

Data: U.S. Department of Labor; Chart: Axios Visuals
Data: U.S. Department of Labor; Chart: Axios Visuals

The U.S. economy added 353,000 jobs in January, nearly doubling consensus expectations, per the Labor Department, while the unemployment rate remained steady at 3.7%.

  • There also were big upward revisions for last November and December.
  • Hourly earnings climbed 19 cents per hour, or 4.48% year-over-year. That means wage growth has outpaced inflation.

The bottom line: If there was anyone left who still thought the Fed would cut rates in March, they gave up that ghost this morning.

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