Jun 28, 2017

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

• It gets worse: Last night we reported that Lightspeed Venture Partners asked Katrina Lake, founding CEO of Lightspeed portfolio company Stitch Fix, to sign a non-disparagement agreement, related to accusations she made against (then) Lightspeed partner Justin Caldbeck. We also posted a copy of the mutually-executed agreement, which Axios obtained from a source. Read it all here, but a few other notes:

  • Lightspeed's behavior was disgraceful. The only leverage it had over Lake at the time was to possibly block her young company's follow-on funding round from Benchmark — an offer that came after she had been turned down by virtually everyone else on Sand Hill Road (including, incidentally, Lightspeed). Even worse, this was a decision that must have involved the entire senior partnership and its legal counsel -- not just a single lecherous partner.
  • It is not clear exactly what Lake accused Caldbeck of doing, nor if Lightspeed asked for specifics. It is entirely possible that the firm just chose the path of least resistance, nodding understandingly toward both Lake and Caldbeck (who, per a source, denied acting inappropriately toward Lake). CYA above all.
  • Lightspeed isn't talking about any of this to me, instead relying on some milquetoast tweets about regretting not having taken "stronger action." But perhaps LPs could get answers, given that Lightspeed would later sell 2% of Stitch Fix into the Benchmark round (which translates into real money, since Stitch Fix reportedly plans to IPO at a $3b-$4b valuation). To be clear, it's possible that the secondary sale was to satisfy Benchmark's ownership threshold requirements but, again, that's something for LPs to sort out.
  • Speaking of LPs: Bloomberg reports that Binary Capital's LPs have voted to wind down the firm's second fund, and that remaining partner Jonathan Teo won't fight it. I've not yet gotten independent confirmation of that.

• Food fight: Amazon's deal for Whole Foods not only is taking a toll on share prices of other grocers, but also on the proposed share price for meal-kit subscription service Blue Apron. The New York-based just slashed its IPO price range from $15-$17 to $10-11, which effectively wipes more than $1 billion off of its projected value. Blue Apron is expected to price tonight and begin trading tomorrow.

• Dude, where's my fund? Sound Ventures, the VC firm led by actor Ashton Kutcher and music manager Guy Oseary, is known for only having two large LPs — Liberty Media and Live Nation. But Kutcher told Howard Stern last week that it does plan, at some point, to fundraise from a broader group of prospective investors. Kutcher and Oseary's predecessor firm is known for making early bets in companies like Airbnb and Uber.

• Hey private equity folks: I really haven't forgotten about you, even though it may have felt that way over the past week.

The BFD

View, a maker of electrochromatic smart glass for buildings, has raised $200 million in new VC funding at what one source says is a post-money valuation north of $1 billion. BlackRock ($70m) and TIAA Investments ($50m) were joined by unspecified existing shareholders in the company, which previously raised over $500 million from firms like Khosla Ventures, Westley Group, Corning, Madrone Capital Partners and DBL Investors. The company's product is designed to save on lighting costs, and also can automatically tint so that office-workers can reduce glare without having to lose natural light.

  • Why it's the BFD: View so far is a survivor of the corporate genocide that hit so many other cleantech startups founded in the aughts with big backing from venture capitalists. It was launched in 2006 as Soladigm, and was one of several cleantech companies of that vintage to open a manufacturing facility in Mississippi (thanks to state government incentives). Today it reports 25% y-o-y growth with 20 million square feet of installed windows in 350 buildings (including stadiums and airports).
  • Bottom line: "Electrochromic windows can cost twice as much as a standard double-paned window. But the energy savings from keeping buildings cool by tinting the windows can be pretty substantial. Tinting can cut 20% of a building's heating and cooling costs and 20% of lighting costs. But most of View's customers are not buying solely for sustainability or cost-cutting. Many of them buy the windows because they're a cool tech product." — Katie Ferenbacher
Venture Capital Deals

• Trax, a Singapore-based provider of computer vision solutions for retailers, has raised $64 million in growth equity funding led by Warburg Pincus. www.traxretail.com

🚑 Glooko, a Mountain View, Calif.-based provider of diabetes data management solutions, has raised $35 million in new VC funding. Georgian Partners led the round, and was joined by Insulet Corp., Mayo Clinic and return backers Canaan Partners, Social Capital, Medtronic and Samsung NEXT. http://bit.ly/2t0tFwY

• Yinhekuyu Media, a Chinese video content producer, has raised $29 million in Series B funding. Yunfeng Capital led the round, and was joined by Youku Tudou and Hong Tai Fund. http://bit.ly/2s0YTTH

• Sitehands, a New York-based provider of enterprise IT field services, has raised $25 million in growth equity funding form FTV Capital. www.sitehands.com

• JASK, a San Francisco-based cyberthreat prioritization solution, has raised $12 million in Series A funding. Dell Technologies Capital led the round, and was joined by TenEleven Ventures and return backers Battery Ventures and Vertical Venture Partners. http://bit.ly/2sWHYmi

🚑 Your.MD, a London-based personalized health assistant app, has raised $10 million in new VC funding. Orkla Ventures led the round, and was joined by return backer Smedvig Capital. http://tcrn.ch/2texlgV

🚑 Trine, a Swedish crowdfunding platform for solar energy projects, has raised €6 million in Series A funding led by Gullspång Invest. www.jointrine.com

• Stashfin, an India-based virtual credit facility provider, has raised $5 million in new VC funding from Snow Leopard Ventures and Alto Partners. http://bit.ly/2uhwzwW

• Flip, a New York-based online marketplace for long-term sublets, has raised $2.2 million in new VC funding from Union Square Ventures, Techstars New York City and Collaborative Fund. http://tcrn.ch/2udcMPa

• Stdlib, a startup that helps connect businesses to APIs, has raised $2 million in seed funding led by BlueYard Capital. http://tcrn.ch/2slDL9K

• CastAR, a Mountain View, Calif.-based augmented reality gaming startup that had raised more than $15 million from groups like Andy Rubin's Playground Global, reportedly has shut down. http://bit.ly/2teCtSE

Private Equity Deals

• HGGC has acquired Denodo, a Palo Alto, Calif.-based provider of data virtualization solutions. No financial terms were disclosed. www.denodo.com

⛽ Hull Street Energy has acquired Nautilus Hydro, owner of five hydroelectric generation facilities located in Massachusetts, from The Carlyle Group. No financial terms were disclosed. www.hullstreetenergy.com

🚑 PatientPoint, a Cincinnati-based provider of point-of-care patient and physician engagement solutions, has raised $140 million in new funding from Searchlight Capital Partners and Silver Point Capital. Existing investor L Catterton remains a shareholder. http://reut.rs/2slOKjF

🚑 Trimb Healthcare, a Swedish portfolio company of Avista Capital Partners, has acquired a portfolio of European OTC anti-fungal products from Cilag GmbH International and Janssen Pharmaceuticals. No financial terms were disclosed. www.trimb.se

Public Offerings

🚑 Mersana Therapeutics Inc., a Cambridge, Mass.-based developer of antibody drug conjugates, raised $75 million in its IPO. The company priced 5 million shares at $15 per share (middle of $14-$16 range), and will trade on the Nasdaq under ticker symbol MRSN. J.P. Morgan was listed as left lead underwriter. The company had raised around $130 million in VC funding, from firms like NEA (41% pre-IPO stake), Pfizer (11.6%), F-Prime Capital (9.9%), Rho Ventures (7.6%), Rock Springs Capital (7.6%), Wellington Management (5.6%), Millennium Pharma (5.6%) and ProQuest Investments (5.5%). www.mersana.com

• TPG Pace Holdings, a TPG Capital-backed blank check company led by Hotwire.com founder Karl Peterson, raised $400 million in its IPO. The company priced 40 million shares at $10 per share, and will trade on the NYSE under ticker symbol TPGH.U. Deutsche Bank was listed as left lead underwriter. http://bit.ly/2shfG99

Liquidity Events

• Alibaba Group (NYSE: BABA) has agreed to invest nearly $1 billion to increase its stake in Southeast Asian e-commerce platform Lazada from 51% to 83%. Sellers include Rocket Internet, while Temasek remains a minority shareholder. http://tcrn.ch/2s1872d

More M&A

• Blue Label Telecoms, a listed South African distributor of prepaid voice and data services, has agreed to acquire privately-held mobile device supplier 3G Mobile Proprietary Ltd. for around $148 million. http://reut.rs/2tkn0Az

• The Russian government plans to launch a privatization process for shipping company Sovcomflot early next month. http://reut.rs/2t0jDMw

• Fiverr, an Israel-based freelance work marketplace that has raised over $100 million in VC funding, has acquired video production marketplace Veed.me, which had raised seed funding from Marker and UpWest Labs. http://tcrn.ch/2tgwPze

⛽ Halliburton (NYSE: HAL) is in talks to acquire Summit ESP, an Oklahoma oilfield equipment company backed by billionaire George Kaiser, according to Reuters. http://reut.rs/2t01uP6

• L'Oreal (Paris: OREP) has agreed to sell The Body Shop to listed Brazilian makeup company Natura Cosmeticos for around $1.1 billion. http://bbc.in/2tSqXcX

🚑 Philips (Amsterdam: PHG) has agreed to acquire Spectranetics (Nasdaq: SPNC), a Colorado Springs, Colo.-based maker of devices to treat heart disease, for around €1.9 billion, or $38.50 per share (27% premium to yesterday's closing price). http://reut.rs/2tjMOMB

Fundraising

• Apollo Global Management has secured $23.5 billion for its latest flagship fund, per the WSJ, which says a final close is imminent. It would be the largest leveraged buyout fund ever raised, depending on how you categorize SoftBank's Vision Fund. http://on.wsj.com/2thAlco

• Benhamou Global Ventures has closed its third fund with $80 million in capital commitments. www.benhamouglobalventures.com

• Verizon Ventures has launched an Israeli venture capital unit that will be led by Merav Rotem-Naaman (who previously ran Nautilus, AOL's Israeli investment and scouting arm). Other Nautilus alums joining Verizon Ventures Israel are Roni Burrell and Gal Ringel. www.verizonventures.com

It's Personnel

⛽ First Reserve, an energy-focused private equity firm, said that Alex Krueger will become president and CEO, effective next month. He was named president and co-CEO in 2015, alongside firm co-founder Bill Macaulay (who will remain executive chairman and chair of its private equity investment committee). https://bloom.bg/2sQkXmJ

• Anthony Scaramucci, an early Trump backer who sold his hedge fund business after November's election, has joined the Export-Import Bank in what Politico refers to as "a top position." http://politi.co/2s1jTJH

Final Numbers
Dan Primack