Mar 21, 2019

Axios Pro Rata

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Top of the Morning

Photo by Noam Galai/WireImage

Venture capitalist Josh Kushner is the subject of a NY Times piece this morning, suggesting possible conflicts of interest related to his business dealings with the Saudi Arabian government.

Specifically, it notes how he attended the 2017 "Davos in the Desert" conference just hours before his brother, White House senior advisor Jared Kushner, quietly arrived to meet with Saudi Crown Prince Mohammed bin Salman.

What we know:

  • Josh Kushner was one of around 3,500 attendees at the conference, including a reporter for the NY Times (which was an event sponsor). Kushner, via a spokesman, says that he and a NYT reporter spoke on multiple occasions in Riyadh, but that the interactions weren't viewed as newsworthy at the time, even though Jared was already running Middle East policy for the Trump administration.
  • Josh Kushner's venture capital firm, Thrive Capital, counted Saudis among its limited partners prior to the 2016 election (not via the Public Investment Fund). We've learned that it still does, although Thrive says it stopped taking on new foreign LPs after Trump won.
    • It was investing out of a $700 million fifth flagship fund in 2017, and subsequently raised $1 billion for Fund VI and another $600 million for its first growth fund.
  • Kushner, a noted Democrat who made a last-minute contribution to Beto O'Rourke's race against Ted Cruz, was invited to the 2018 Riyadh confab, but did not attend.
  • Yes, where there are Kushners there can be endemic conflicts. This just doesn't read like one.
  • Per a Thrive Capital spokesman:
" Josh regularly attends financial and technology conferences and has for many years. This was no different...
Josh has been clear and consistent with regards to his political beliefs and stance on the administration. Despite his clear articulation of this difference of opinion, Thrive has taken great pains to avoid even the appearance of conflict, and, as we told the Times, after the 2016 election the firm stopped taking investment from any new foreign limited partners with potential business before the administration. We did this not because we had to, and not because anyone asked us to - we did it proactively because we thought it was the right thing to do."

🐷 Salty: Evans Food Group, a Chicago-based pork rinds maker owned by Wind Point Partners, this morning announced the purchase of Georgia-based rival Turkey Creek.

  • Pork rinds have gone full Brooklyn of late, following meat jerky out of the gas station stores and into high-end groceries.
  • They even got their own Wall Street Journal profile: "The fatty rinds appeal to snackers looking to lower carbs and increase protein in their diets."
  • The Evans and Turkey Hill merger is designed to strengthen the lower-priced, traditional pork rinds market. I don't know if Warren Buffett eats pork rinds or cracklins but, if he does, these would probably be his brands.

💰 In January we discussed Elizabeth Warren's "wealth tax" proposal, and included some comment from left-leaning economist Greg Leiserson.

  • This morning Leiserson is out with a more detailed primer on how such a surcharge would actually work, plus a set of charts detailing American wealth disparities.
  • His research also shows that the 1% wealthiest Americans have total assets of $10.4 million, while $2.4 million puts you in the top 5% and $1.2 million puts you in the top 10%. (Wealth being defined as net assets minus liabilities, not by income.)

🏀 Last chance to join more than 1,100 other Pro Rata readers in our March Madness contest. Brackets must be completed by 12:15 pm ET today:

🎧 Pro Rata Podcast: Our new episode digs into Fed Chair Jay Powell, and why he's become much more public and much more political. Listen here.


Source: Giphy

Lion Air of Indonesia reportedly is prepping a domestic IPO that could raise upwards of $1 billion.

  • Why it's the BFD: Because this comes less than five months after a Lion Air flight crashed, killing all 189 people aboard and sparking the investigation into Boeing's 737 MAX aircraft line.
  • Bottom line: "Lion Air, the leader in one of the world’s fastest growing markets, has long toyed with a flotation, only to conclude it could fund some of the industry’s biggest multi-billion dollar plane orders placed with Boeing and Airbus from its own operations and bank financing." — Cindy Silviana & Anshuman Daga, Reuters
Venture Capital Deals

Opendoor, a San Francisco-based startup that buys and sells homes, raised $300 million at a $3.8 billion post-money valuation from backers like General Atlantic, Hawk Equity, SoftBank Vision Fund, ATV, Lennar Corp., GV, Fifth Wall Ventures, SV Angel, Norwest Venture Partners, NEA, GGV Capital and Khosla Ventures.

Tarana Wireless, a Santa Clara, Calif.-based provider of fixed wireless access network solutions, raised $88 million from Khosla Ventures, EchoStar and return backer 1010 Holdings.

Carbon Engineering, a Canadian direct air capture startup, raised US$68 million from such backers as Bill Gates, Murray Edwards, BHP, Chevron Technology Ventures, Oxy Low Carbon Ventures, Bethel Lands Corp., Carbon Order, First Round Capital, Lowercase Capital, Rusheen Capital Management, Starlight Ventures and Thomvest. Read more in Axios Generate.

Movius, an Atlanta-based provider of enterprise employee “bring your own device” solutions, raised $45 million in Series D funding. JPMorgan Chase led, and was joined by return backers PointGuard Ventures, NEA and Anschutz Investment Co.

Guesty, an Israeli provider of pools for property managers who list on Airbnb-type platforms, raised $35 million. Viola Growth led, and was joined by Vertex Ventures, Journey Ventures, Kingfisher Investment Advisors, La Maison Compagnie d’Investissement, TLV Partners and Magma Ventures.

WorkBoard, a Redwood City, Calif.-based provider of enterprise strategy and results management software, raised $23 million in Series B funding. GGV Capital led, and was joined by M12, Workday Ventures, Floodgate and Opus Capital.

Ease, a San Francisco-based provider of HR and benefits software for SMBs, insurance brokers and insurance carriers, raised $19 million in Series B funding. Centana Growth Partners led, and was joined by Propel Venture Partners, Compound Ventures, Freestyle Capital and Upside Partnership.

The Plum Guide, a London-based holiday home testing and curation site, raised £14 million in Series B funding. Talis Capital led, and was joined by Latitude, Hearst Ventures and return backer Octopus Ventures.

Jitjatjo, an on-demand staffing platform for the service and hospitality markets, raised $11 million in Series A funding led by Morningside Technology Ventures.

AppDetex, a Boise, Idaho-based digital brand protection platform, raised $10 million in Series B funding. First Analysis led, and was joined by Epic Ventures and Origin Ventures.

Kaarta, a Pittsburgh-based provider of mobile 3D reality capture software, raised $6.5 million. GreenSoil Building Innovation Fund led, and was joined by Riverfront Ventures, Zamagias Properties, Quaker Capital Investments and Startbot.

Amify, an Arlington Va.-based provider of revenue improvement solutions for third-party sellers on Amazon, raised $5.8 million in Series A funding. Mercury Fund led, and was joined by Dundee VC, CincyTech, SaaS Venture Capital and Capital One co-founder Nigel Morris.

Fetcher, a New York-based outbound recruiting platform, raised $5.4 million in seed funding co-led by Accomplice and Slow Ventures.

🦆 WarDucks, an Ireland-based AR game development studio, raised €3.3 million led by EQT Ventures.

Private Equity Deals

Ares Management acquired Coolsys, a Brea, Calif.-based refrigeration and HVAC services company, from Audax Private Equity.

Gravity Oilfield Services, a Snyder, Texas-based portfolio company of Clearlake Capital, acquired certain water disposal infrastructure from Belfield, N.D.-based MBI Oil & Gas.

Pleatco, a Glen Cove, N.Y.-based provider of aftermarket cartridge filters for the pool and spa industry, acquired both APEL International (Louisville, Ky.) and Milton Manufacturing (Ontario, Canada). Pleatco is a portfolio company of Align Capital Partners.

🚑 Primus Capital invested in Harmony Healthcare IT, a South Bend, Ind.-based provider of data extraction, migration and archival solutions.

Public Offerings

Fastly, a San Francisco-based content delivery network, hired BAML to lead an IPO that could come later this year, per Reuters. The company has raised around $220 million firms like Amplify Partners, August Capital, Battery Ventures, OATV, Deutsche Telekom Capital Partners, Sozo Ventures and Swisscom Ventures.

👖 Levi Strauss & Co. raised $623 million in its IPO, pricing 36.7 million shares at $17 (above $14-$16 range). The jeans giant will begin trading today on the NYSE (LEVI) with a fully-diluted market value of $6.9 billion and an enterprise value of $7.5 billion.

More M&A

Bosch receiving strategic and private equity interest for its packaging machinery unit, which could fetch between €500 million and €600 million, per Reuters.

Medco, an Indonesian oil and gas company, agreed to buy Ophir Energy (LSE: OPHR) for £408.4 million.

Murphy Oil (NYSE: MUR) is in talks to sell its Malaysian oil and gas assets to Thailand’s PTTEP for $2.13 billion, per Reuters.

OneFi, a Nigerian consumer lending platform, acquired local payment and financial transactions startup Amplify.

🚑 Waypoint/Ares Life Sciences, an investment vehicle of Swiss billionaire Ernesto Bertarelli, agreed to pay 730 million for the 17% stake it doesn’t already hold in French immunotherapies company Stallergenes.


Sierra Ventures is raising $175 million for its twelfth fund, per an SEC filing.

It's Personnel

Karen Appleton Page, formerly of Apple and Box, has joined B Capital Group as a general partner.

Heather Widman joined Building Ventures as a principal. She previously led product, customer and brand marketing for WordStream (acquired by Gannett last year).

Final Numbers
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Data: Federal Reserve Bank of St. Louis; Chart: Chris Canipe/Axios