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Peloton Interactive last night raised $1.16 billion in its IPO, giving it an initial market cap of around $8.1 billion.
Details: Peloton priced 40 million shares at $29, which was the high end of its range. Existing investor Technology Crossover Ventures plugged in another $100 million, via a concurrent placement. It will begin trading later this morning on the Nasdaq under ticker PTON.
ROI: The company had raised nearly $1 billion in VC funding, most recently at a $4.15 billion post-money valuation. Major backers include TCV, Tiger Global, Fidelity, True Ventures, and L Catterton.
Yes, there are doubters. Not just because of the faddish nature of fitness, but also because Peloton has grown exclusively in a growing economy. People may still work out during a recession, but lower-cost options are abundant. Plus, Peloton doesn't seem to have accounted for the possibility of widespread defaults on hardware financing plans. Expect some stubborn shorts.
I'm pretty bullish, probably because I own a Peloton and am a satisfied customer. Plus, Apple doesn't seem interested in playing in connected fitness hardware/software/media, even though that seems to be its sweet spot.
The bottom line is that public market investors bought high into an unprofitable, VC-backed, tech company that pioneered a new category. Uber and WeWork aren't unicorns of the apocalypse. They're exceptions that prove the persistent rule.
Altria (NYSE: MO) and Phillip Morris International (NYSE: PM) said that they are no longer in talks for an all-stock merger, which would have reunited the two cigarette makers after more than a decade apart.
• Divvy, a San Francisco-based rent-to-own platform for homes, raised $43 million in Series B funding. GIC and Lennar co-led, and were joined by return backers Andreessn Horowitz, Caffeinated Capital, and Max Levchin. http://axios.link/R0JY
• TigerGraph, a Redwood City, Calif.-based graph analytics platform, raised $32 million in Series B funding led by Susquehanna International Group. http://axios.link/CLwz
• Darwinbox, an India-based human resources management platform, raised $15 million in Series B funding. Sequoia Capital India led, and was joined by Lightspeed India Partners, Endiya Partners, and 3one4 Capital. http://axios.link/PGrL
• Fiddler Labs, a Mountain View, Calif.-based “AI visibility” startup, raised $10.2 million in Series A funding. Lightspeed Venture Partners and Lux Capital led, and were joined by Haystack Ventures and Bloomberg Beta. http://axios.link/maoz
🚑 Mednition, a Burlingame, Calif.-based provider of decision-support software for ER nurses, raised $10 million in Series A funding led by Concord Health Partners. http://axios.link/nSW0
• Summer, an advisory platform for student loan borrowers, raised $10 million in Series A funding led by QED Investors. http://axios.link/hRPD
• Beat81, a German fitness tech startup, raised €6.4 million in Series A funding led by EQT Ventures. www.beat81.com
• Amava, a San Mateo, Calif.-based social experience platform for retirees and empty-nesters, raised $6.2 million from RPM Ventures. www.amava.com
• CyberFortress, a San Antonio, Texas-based, raised $3 million in seed funding co-led by Greycroft and LiveOak Venture Partners. www.cyberfortress.com
• Influencer, a UK-based social media influencer marketing platform, raised £3 million in Series A funding led by Puma Private Equity. www.influencer.com
• NTWRK, a mobile video commerce platform focused on youth culture, raised $3 million from Foot Locker (NYSE: FL). http://axios.link/Cipv
🥩 Tilman Fertitta, owner of Landry’s and the Houston Rockets, agreed to buy Del Frisco’s Double Eagle Steakhouses and Del Frisco’s Grilles from L Catterton, on the same day that L Catterton completed its $650 million take-private purchase of Del Frisco’s Restaurant Group. L Catterton will retain the Bartaco and Barcelona Wine Bar brands. http://axios.link/4Aaj
• GTCR agreed to buy Cole-Parmer, a Vernon Hill, Ill.-based maker of lab and industrial fluid handling products, from Golden Gate Capital (which will retain a minority stake). www.coleparmer.com
• Inspire Brands, an Atlanta-based portfolio company of Roark Capital Partners, agreed to buy sandwich shop chain Jimmy John’s. http://axios.link/0L2C
⛽ Kodiak Gas Services, a Montgomery, Texas-based portfolio company of EQT Partners, agreed to buy rival contract compression company Pegasus Optimization Managers from Apollo Global Management. www.pegasus15.com
• Midwest Composite Technologies, a Hartland, Wis.-based portfolio company of Core Industrial Partners, acquired Fathom, an Oakland-based 3D printing and additive manufacturing company. www.midwestcomposite.com
🚑 New Mountain Capital acquired Emids, a Franklin, Tenn.-based provider of software for healthcare payers and providers, from Council Capital and Baird Capital Partners. www.emids.com
• Rubicon Technology Partners acquired a majority stake in Cin7, a New Zealand-based provider of inventory management and point-of-sale software. www.cin7.com
• Silver Lake is in talks to buy Australian live event ticketing company TEG from Affinity Equity Partners for over A$1 billion, per Australian Financial Review. http://axios.link/Hwfh
⛽ TPG terminated its $930 million deal to buy a majority stake in Goodnight Midstream, a Dallas-based provider of fluids handling solutions to midstream oil and gas companies, because Goodnight was unable to meet unidentified closing conditions. Sellers were to have included Tailwater Capital. http://axios.link/fTxn
• SoftBank Group is among the first-round bidders for Ooedo Onsen Monogatari, a Japanese operator of hot spring resorts that’s being sold by Bain Capital, per Bloomberg. A deal could be worth more than $900 million. http://axios.link/ZeWb
• Allcargo Logistics, a listed Indian cargo company, agreed to buy smaller rival Gati for around $183 million, per Bloomberg. http://axios.link/ixoe
🚑 Amryt (AIM: AMYT) bought Aegerion Pharmaceuticals, a bankrupt Massachusetts maker of therapeutics for rare diseases. http://axios.link/MKmY
• Baidu (Nasdaq: BIDU) plans to sell nearly a third of its 19% stake in online travel platform Ctrip (Nasdaq: CTRP) for around $1 billion. http://axios.link/9AWP
• Bakkafrost (Oslo: BAKKA) agreed to buy a 68.6% stake in The Scottish Salmon Co. (Oslo: SSCOM) from Northern Link at a $639 million enterprise value. http://axios.link/AYh3
• SS&C Technologies (Nasdaq: SSNC) agreed to buy certain algorithmics and related assets from IBM (NYSE: IBM). www.ssctech.com
• WillScot (Nasdaq: WSC) offered to buy Mobile Mini (Nasdaq: MINI), a Phoenix-based provider of portable storage solutions, per Reuters. http://axios.link/orwJ
• Apollo Global Management promoted Matt Nord and David Sambur to co-heads of its global private equity business, succeeding Scott Kleinman (who remains Apollo’s co-president). Apollo also promoted Olivia Wassenaar and Geoff Strong to co-heads of natural resources investing, succeeding Greg Beard (who will stay on as an advisor until next year). http://axios.link/023g
• Mike Haridopolos, former president of the Florida state senate, joined Chicago-based Five G Capital Partners as a senior managing director and chairman of the firm’s advisory board. www.fivegcapital.com
• Shamit Mehta joined TZP Group as a partner focused on growth equity, per his LinkedIn profile. He previously was with Guidepost Growth Equity. www.tzpgroup.com
• Natalya Michaels joined MidOcean Partners as a managing director, focused on marketing and investor relations. She previously was a managing director with Artisan Partners. www.midoceanpartners.com
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