September 12, 2023

Top of the Morning

Photo illustration: Natalie Peeples/Axios. Photo: Chesnot, Bloomberg/Getty Images

Jack Dorsey had second thoughts about supporting Elon Musk's takeover of Twitter so Musk made Dorsey a secret offer he couldn't refuse.

  • That's according to the new Musk biography by Walter Isaacson, released today.

Dorsey and Musk were longtime acquaintances and mutual admirers.

  • In fact, the former Twitter CEO had suggested to his successor, Parag Agrawal, that Musk be added to the social network's board of directors — well before the buyout talks began.
  • Dorsey also was part of a Twitter board that in April 2022 accepted Musk's $54.20 per share takeover offer, valuing the company at $44 billion, but no longer on that board when it sued Musk to enforce the agreement.
  • Most importantly, Dorsey agreed to roll his 2.4% equity stake into the buyout, which helped Musk lower his own capital contribution by around $1 billion.

As the takeover got closer, however, Isaacson reports that Dorsey began getting cold feet.

  • Some of his concerns were borne of Musk's impulsiveness, which threatened to destroy what Dorsey had spent so many years building.
  • "Musk had called [Dorsey] almost daily over the past week, reassuring Dorsey that he truly loved Twitter and wouldn't harm it."
  • Dorsey was also worried about his own pocketbook and future liquidity needs, despite still being that largest outside shareholder in Block (fka Square).

Musk's solution was a promise: Were Dorsey to ever need money, Musk would buy back his Twitter shares at the original takeover price of $54.20 per share. In other words, $44 billion became Dorsey's valuation floor.

  • Neither Dorsey nor an X spokesperson returned a request for comment on if Dorsey still holds all of his X shares.

The bottom line: Dorsey is leading a nascent social network called BlueSky, but hasn't issued many public statements on Musk's stewardship of his former company.

  • One exception came in July, when Dorsey tweeted: "Running Twitter is hard. I don't wish that stress upon anyone. I trust that the team is doing their best under the constraints they have, which are immense. It's easy to critique the decisions from afar…which I'm guilty of…but I know the goal is to see Twitter thrive. It will."

The BFD

Illustration: Aïda Amer/Axios

Apple (Nasdaq: AAPL) signed a new chip supply agreement with Qualcomm (Nasdaq: QCOM), which will apply to iPhones being launched between 2024 and 2026.

Why it's the BFD: This comes three years after Apple spent $1 billion to buy Intel's smartphone modem business — a move intended to let Apple displace Qualcomm when their existing agreement ended at the end of 2023.

Elsewhere: It also comes ahead of this week's highly anticipated U.S. IPO for British chip design giant Arm, which reportedly is already oversubscribed.

  • Apple licenses its iPhone chip design architecture from Arm, with the two sides recently extended that relationship through 2040 (as disclosed in a regulatory filing).
  • Arm, meanwhile, generates around 11% of its revenue via royalties from Qualcomm, but also is suing the chipmaker for breach of contract and trademark infringement.

The bottom line: Apple has spent both money and ink on moving its chip supply chain in-house. But just hours before the unveiling of iPhone 15, it seems that Infinite Loop will remain reliant on outsiders for years to come.

Venture Capital Deals

Lyten, a San Jose, Calif.-based developer of a new form of graphene for battery manufacturing, raised $200m in Series B funding. Prime Movers Lab led, and was joined by Stellantis, FedEx, Honeywell and The Walbridge Group. https://axios.link/468jM1W

Enfabrica, a Mountain View, Calif.-based AI chips startup, raised $125m in Series B funding. Atreides Management led, and was joined by Sutter Hill Ventures, Nvidia, IAG Capital Partners, Liberty Global Ventures, Valor Equity Partners, Infinitum Partners and Alumni Ventures. https://axios.link/3PmLAZI

🚑 Arialys Therapeutics, a La Jolla, Calif.-based developer of therapies for autoimmune neuropsychiatry, raised $58m in seed funding from Avalon BioVentures, Catalys Pacific, MPM BioImpact, Johnson & Johnson Innovation and Alexandria Venture Investments. www.arialystx.com

Mighty Buildings, an Oakland, Calif.-based maker of 3D-printed homes, raised $52m. Waed Ventures and Bold Capital co-led, and were joined by Kholsa Ventures. https://axios.link/3Rd68Gs

FloLive, a London-based IoT connectivity startup, raised $47m in Series C funding. Greenfield Partners and insider 83North co-led, and were joined by Qualcomm Ventures, Dell Technologies Capital, Saban Ventures and Hazelnut Partners. https://axios.link/3rfWiZF

Kale Logistics Solutions, an Indian logistics SaaS startup, raised $30m in Series B funding led by Creaegis Advisors. https://axios.link/3LeaFVq

ELSA, a Los Gatos, Calif.-based English language learning platform, raised $22.5m in Series C funding. UOB Venture Management led, and was joined by UniPresident, Aozora Bank, Vietnam Investments Group, Development Bank of Japan and insiders Gradient Ventures, Monk's Hill Ventures and Global Ventures. https://axios.link/45O9NPx

CertifID, an Austin, Texas-based startup that products against wire fraud in real estate transactions, raised $20m led by Arthur Ventures. https://axios.link/3rajj0d

🚑 Bold, an LA-based provider of virtual exercise programs for Medicare Advantage members, raised $17m in Series A funding, per Axios Pro. Rethink Impact led, and was joined by Samsung Next and insiders Andreessen Horowitz, Khosla Ventures, GingerBread Capital and Primetime Partners. https://axios.link/3sOb7TZ

Proven, an SF-based personalized fragrance startup, raised $12.2m in Series A funding led by NewH2 Ventures. www.provenskincare.com

🚑 Sonera, a Berkeley, Calif.-based developer of sensors for non-invasive human-machine interfaces, raised $11m in seed funding led by Amplify Partners. https://axios.link/3EBAStc

AuthMind, a Bethesda, Md.-based identity security ops startup, raised $8.5m in seed funding. Ballistic Ventures led, and was joined by IBM Ventures. https://axios.link/48cGMhV

GamePhilos Studio, a Singapore-based mobile game publisher, raised $8m in seed funding from Xterio, Animoca Ventures, SevenX Ventures, Chain Hill Capital, Hashkey Capital, Sanctor Capital, Game7, Bas1s, GSR Markets and GSG Ventures. https://axios.link/3LGD5HV

Trident Digital Group, a Connecticut-based digital asset lender, raised $8m in seed funding. New Form and White Star Capital co-led, and were joined by CMT Digital, Joint Effects and Permit Ventures. www.tridig.io

🚑 DeLorean AI, a Miami-based patient outcomes prediction startup, raised $7.55m in Series A funding. Sopris VC led, and was joined by Pinta Capital Partners and James Chow. www.deloreanai.com

Alix, a Los Gatos, Calif.-based estate settlement automation tool, raised $5.5m in seed funding. Initialized Capital led, and was joined by Magnify, Scribble, American Family Ventures and Alumni Ventures. https://axios.link/3EzOMMl

🚑 Glass Health, an SF-based digital notebook for clinicians, raised $5m led by Initialized Capital. https://axios.link/3sPx8BF

🚑 Thirona, a Dutch thoracic CT image analysis startup, raised $5m from Heran Partners and the Borski Fund. www.thirona.eu

Prewitt Ridge, an LA-based requirements management and digital thread startup, raised $4.1m in seed funding. Squadra Ventures led, and was joined by Stage Venture Partners, Aurelia Foundry, Wonder Ventures, Haystack, Acequia, TechStars and GC&H. www.prewittridge.com

OpenCover, a decentralized insurance startup, raised $4m in seed funding co-led by NFX and Jump Crypto. https://axios.link/3EvG7uu

🚑 Co:Helm, a New York-based prior authorizations automation startup, raised $3.2m in seed funding, per Axios Pro. Sequoia Capital led, and was joined by Blue Lion Global, Nebular, Ventures Together, Four Acres and Anamcara. https://axios.link/48cnOrS

Common Trust, an SF-based employee ownership buyout option for small business owners, raised $2.6m in seed funding. Crossbeam Venture Partners led, and was joined by Schmidt Futures. https://axios.link/3rajB7k

GoCharlie, a developer of generative AI models for marketing, raised $2m in seed funding from Goodwater Capital, SRI International, XRC Ventures, Geek Ventures, Textbook.vc and Hawke Ventures, per Axios Pro. https://axios.link/48cMBMv

Hadrius, a New York-based SEC compliance automation startup, raised $2m in seed funding from YC, Lynett Capital, Singularity Capital, Dorm Room Fund and Unpopular Ventures. www.hadrius.com

Glass, an NFT video startup, is shutting down after raising $5m from firms like TCG Crypto and 1kx. https://axios.link/3Rfw3x4

🚑 Mavida Health, an LA-based maternal mental health platform, raised $1.5m in pre-seed funding led by, per Axios Pro. https://axios.link/3sPziRN

Private Equity Deals

Arjun Infrastructure Partners, a London-based PE firm with €5.5b in AUM, is considering either a full or partial firm sale, per Bloomberg. https://axios.link/45MQZ2Z

Bregal Sagemount invested in Bradford Airport Logistics, a Houston-based provider of logistics services to airports and other transportation. www.airportlogistics.org

CenterOak Partners acquired Guardian Access Solutions, a Nashville-based provider of maintenance, repair, and installation services for exterior access control equipment. www.guardianaccess.com

Cetera, an El Segundo, Calif.-based portfolio company of Genstar Capital, agreed to buy Avantax (Nasdaq: AVTA), a Dallas-based wealth management software maker, for around $1.2b, or $26 per share in cash https://axios.link/3Ey2wqP

🚑 Cimarron Healthcare Capital invested in Forward Health, an Owings Mills, Md.-based provider of solutions for patients with obstructive sleep apnea. www.fwdhealthcare.com

Comvest Partners reinvested in existing portfolio company ClearOne, a Baltimore-based debt resolution services provider. www.clearoneadvantage.com

J.D. Power, a portfolio company of Thoma Bravo, agreed to buy Autovista Group, a provider of European and Australian automotive data and analytics, from Hayfin Capital Management. https://axios.link/3LlZNoe

KKR agreed to invest another $249m into India's Reliance Retail Ventures, bringing its total equity stake up to 1.42%. https://axios.link/3Zu827T

US Light Energy, a Latham, N.Y.-based distributed generation solar developer, raised $15m from Kimmeridge. www.uslightenergy.com

Walpole Outdoors, a Foxborough, Mass.-based portfolio company of Argosy Private Equity, acquired Finyl Sales, an Ocala, Fla.-based maker of cellular PVC exterior trim products. www.walpoleoutdoors.com

Public Offerings

🚑 RayzeBio, a San Diego-based developer of targeted radiopharmaceuticals, set IPO terms to 14.4m shares at $16-$18. It would have a $1b fully diluted market value, were it to price in the middle, and plans to list on the Nasdaq (RYZB). The pre-revenue raised over $400m in VC funding from Viking Global (12.5% pre-IPO stake), Versant Ventures (12.2%), VenBio (12.2%), Venrock (6.4%), Sofinnova Investments and Wellington Management. https://axios.link/3svRtvS

Renk, a German military gearbox maker owned by Triton, confirmed that it plans to go public in Frankfurt this year. https://axios.link/3RiqaPP

TKO Group, the Endeavour (NYSE: EDR) live events spinout that merges UFC with newly-acquired World Wrestling Entertainment, was officially formed and will begin trading today on the NYSE.

Liquidity Events

Byju's, the Indian education giant valued last year by VCs at $22b, is seeking to raise around $1b by selling Great Learning and Epic — two companies it acquired in 2021 — per Reuters. https://axios.link/3r0n3l2

Capgemini (Paris: CAP) agreed to acquire the financial crime compliance unit of Exiger, a New York-based portfolio company of Carrick Capital Partners. www.exiger.com

More M&A

Citi (NYSE: C) is spinning out Bridge, an SMB lending startup incubated within the bank, per Axios Pro. https://axios.link/3r994JE

FunNow, a Taiwan-based activities booking app, merged with Thailand-based restaurant booking app Eatigo. FundNow has raised over $20m from firms like Ascendo Ventures and Perfect Hexagon, while Eatigo raised nearly $30m from firms like TripAdvisor and Choco Up. https://axios.link/3LiPAJk

Shell (NYSE: SHEL) agreed to sell its 30% stake in the British North Sea's Cambo oil and gas field to Ithaca Energy (LSE: ITH). https://axios.link/44J0xLa

Smurfit Kappa (LSE: SKG), an Irish paper packaging company, agreed to merge with Atlanta-based rival WestRock (NYSE: WRK) for $11.2b in cash and stock. Flashback.

Fundraising

9900 Capital, an early-stage VC firm co-founded by Christopher Corbishley (ex-Hedosophia) and Rory Mounsey-Heysham (ex-Gates Foundation), raised $100m for its debut fund. https://axios.link/4671huF

Brookfield Asset Management and Societe Generale are partnering on a new "high quality" private debt fund that includes a €2.5b cornerstone investment and is targeting a total of €10b. https://axios.link/3Ri1KWM

BV Investment Partners raised $1.75b for its 11th fund, focused on tech-enabled business services companies. www.bvlp.com

H.I.G. Capital raised $6b for its fourth U.S. midmarket buyout fund. https://axios.link/44O0Xjp

Mubadala Investment Co. committed $1b to Blue Owl Capital's credit strategy, with an initial focus on tech lending, as part of a new strategic partnership. https://axios.link/45OAC5W

NordicNinja, a VC firm focused on European startups within the climate tech and deep-tech sectors, raised 200m for its second fund. www.nordicninja.com

Sierra Ventures raised $265m for its 13th fund, focused on seed and Series A deals for B2B startups. www.sierraventures.com

Vertex Ventures Southeast Asia & India raised $541m for its fifth fund. https://axios.link/48cKgRx

It's Personnel

Hamilton Lane announced that Erik Hirsch and Juan Delgado-Moreira will become co-CEOs on Jan. 1, succeeding Mario Giannini (who becomes executive co-chair, alongside Hartley Rogers). www.hamiltonlane.com

Richard Haass, former president of the Council on Foreign Relations, joined Centerview Partners as a senior counselor, per Bloomberg. https://axios.link/3RjbNut

Lee Landrum joined Comvest Partners as a partner and head of investor relations. He previously was with Tennenbaum Capital Partners. www.comvest.com

Stephen Lovegrove, former U.K. national security adviser is joining Lazardas a senior adviser. https://axios.link/3r7bw3j

Joshua Niedner joined Apogem Capital as head of credit and a senior managing director. He previously was with Vista Credit Partners. www.apogemcapital.com

Karen Parks joined Charger Investment Partners as a managing director. She previously was with Gallant Capital and Levine Leichtman Capital Partners. www.chargerinv.com

Hoshrav Patel joined CVC Capital Partners as a London-based director. He previously was with Bridgepoint. https://axios.link/3PAqxE3

Julia Perroni joined Houlihan Lokey as a Paris-based managing director in the firm's capital markets group. She previously led France leveraged finance for Credit Suisse. www.hl.com

Natalie Sportelli joined consumer brand-focused VC firm Bullish as a director. She previously was with Thingtesting and Lerer Hippeau. www.bullish.co

Final Numbers

Data: Yahoo Finance; Source: Axios Visuals

Acelyrin shares collapsed this morning, five months after raising $540 million in an upsized IPO.

Driving the news: The LA-area biotech, which develops therapies for inflammatory diseases, reported a clinical failure of its lead drug candidate izokibep.

  • Per FierceBiotech: "Acelyrin has the cash to work through the setback in the first phase 2b/3 study. The biotech ended June with $823 million to its name and has additional data drops that could reinvigorate investor enthusiasm for izokibep coming up. Top-line data from a phase 2b/3 clinical trial in psoriatic arthritis are due in the first quarter of next year."

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