Alex Wolf, founder of Kingswood Capital Management, doesn't think software valuations are low enough yet to be attractive investments. But he does expect them to get there soon, particularly as debts come due.

• That was a top takeaway from a recent conversation I had with Alex, on the heels of Kingswood raising $3.1 billion for its fourth flagship fund and $900 million for its first small-cap fund.
• Kingswood isn't primarily a tech investor — instead preferring "old-world economy" businesses like tire distribution and poultry — but Wolf (ex-Ares, Cerberus) has done it before and may dive back in.

What follows is edited for length and clarity:

Dan: Is Kingswood going to begin scooping up a bunch of these SaaS businesses with depressed valuations?

Alex: "We have not seen a lot of midmarket action yet in the midmarket, but I do think you're soon going to see debt maturities force a lot of events, maybe resetting valuations even further. We're certainly paying attention."

You don't invest directly in AI, but your entire portfolio is implementing AI in some way. Is that ROI in the red or the black?

"Portfolio wide, I think it's in the black. ... The midmarket also may be able to capitalize on some of these opportunities and processes quicker than some of these larger corporations who, despite having much more resources and maybe putting more dollars at this, have more bureaucracy, security concerns, etc.

• "So it will be interesting to track large-cap vs. midmarket, when it comes to AI ROI."

When it comes to financing a new deal, who are you calling first: private lenders or banks?

"The answer can be both, depending on the situation.

• "I think the private credit market will continue to make headlines. Everything from more redemptions to more of these funds actually taking control — which is becoming its own issue from a resource and time perspective — as well as a lot of the 2021 software maturities coming to a head.
• "But I wouldn't extrapolate that to say the private credit market isn't healthy or functioning. It is, even if that doesn't make sense in a headline."

You've now raised four funds in five years, which might suggest you're either not raising enough each time or are investing too quickly. What happened?

"Fund III we deployed really quickly, growing both the number of companies and check sizes, even though we'd moved from a $620 million fund to a $1.5 billion fund. To your point, we were trying to stretch out our deployment time horizon as well, which happened but not quite as much as we expected.

• "When talking to LPs about it, key has been our ability to generate early distributions, even out of Fund III. DPI doesn't lie."

Unwell, a media company co-founded by podcast host Alex Cooper, raised its first round of outside funding from WTSL at a $500 million pre-money valuation.

Why it's the BFD: This deal is expected to fuel M&A ambitions for Unwell, which already is profitable but seeking to expand into new business lines and buttress existing ones.

The intrigue: It also comes after a recent Vanity Fair investigation into the company, claiming a toxic workplace and volatile behavior by Matt Kaplan, Unwell's co-founder and Cooper's husband.

• A source says that WTSL — led by ex-Endeavor execs Patrick Whitesell and Jason Lublin — had "no concerns" about the allegations, following due diligence.

The bottom line: "Unwell's podcast network now hosts more than a dozen shows, produces film and TV shows, hosts live events and runs a creative agency. Unwell also sells consumer products, including hydration and energy drinks." — Kerry Flynn, Axios

• Thrive Holdings, formed by Josh Kushner's Thrive to apply AI to legacy services companies, raised over $2b at a $12b post-money valuation from backers like D1 Capital Partners, Altimeter Capital, and SoftBank. axios.link/3UudZms

• River AI, an open-source AI startup led by xAI co-founder Igor Babuschkin, raised $1.1b led by General Catalyst and AMP PBC, with Nvidia, AMD Ventures, YC, and Temasek participating. axios.link/4i2XNT5

⚡ Form Energy, a Somerville, Mass.-based developer of multi-day grid batteries, raised $750m in Series G funding. T. Rowe Price led, joined by Sequoia Capital, Janus Henderson, Franklin Templeton, PEAK6 Investments, Prelude Ventures, Engine Ventures, TPG Rise Climate, Capricorn, Breakthrough Energy Ventures, Dustin Moskovitz and Cari Tuna, Gigascale Capital, Coatue, Energy Impact Partners, NGP, GE Vernova, Blindspot Ventures, and M&G Catalyst Fund. axios.link/3TUGTvZ

• Lovable, a Swedish vibe coding startup, raised $400m in Series C funding at a $13.3b post-money valuation. Menlo Ventures and Scaleup Europe Fund led, joined by Balderton, Carmignac, Kaszek Ventures, LTS Growth, Tencent, World Innovation Lab, Regent and insiders Accel, Antler, CapitalG, DST Global, Evantic Capital, HubSpot Ventures, and Salesforce Ventures. axios.link/3RKit7R

• CodeRabbit, a Walnut Creek, Calif.-based AI code review startup, raised $143m in Series C funding at a $1.5b post-money valuation, per Axios Pro. Atomico and Smash Capital led, joined by BMW i Ventures, Datadog, Hirtle Callaghan, SineWave Ventures, CRV, Scale Venture Partners, Flex Capital, and Pelion Venture Partners. axios.link/45oswTb

• Finn, a German car subscription provider, raised €140m in Series D equity and debt funding at a $1b+ post-money valuation. Portage led the equity, joined by UVC Partners, Planet First Partners, and Korelya Capital. Debt came from BC Partners Credit and Runway Growth Capital. axios.link/4gbDhNF

• Silicon Data, a real-time compute pricing data platform, raised $30.5m in Series A funding, per Axios Pro. Valor Atreides AI Fund led, joined by ME Group, DRW, F-Prime, Samsung, VanEck, Further, Jump, Tectonic, Wintermute, Breed, Hack, Blank VC, Sancus Ventures, and SoGal Ventures. axios.link/3TSEFx7

• MarginEdge, an Arlington, Va.-based provider of restaurant management software, raised $80m in Series D equity and debt funding. Ten Coves Capital and Schooner Capital led the equity, joined by Derive Ventures and Osage Venture Partners. axios.link/4gr6g14

🚑 InduPro, a Cambridge, Mass.-based oncology biotech, raised $77m in Series B funding, per Axios Pro. The Column Group led, joined by Vida Ventures, MRL Ventures Fund, Emerson Collective, Euclidean Capital, Solasta Ventures, Sanofi, and Eli Lilly. axios.link/45lKxla

🚑 Boulevard Bio, an NYC-based precision immunology startup, raised $65m from Deerfield Management. axios.link/45TYIhl

• Skan AI, a Menlo Park, Calif.-based context graph of work for enterprise AI, raised $63m. Cathay Innovation and Dell Technologies Capital led, joined by Citi Ventures, Bloomberg Beta, State Farm Ventures, and Wipro Ventures. axios.link/4wPLf64

• Yulu, an Indian electric mobility startup, raised $63m in equity led by GEF Capital Partners and $30m in debt. axios.link/4xCaDMF

• Heaviside Industries, an LA-based defense hardware startup, raised $60m in Series B funding. Felicis led, joined by Hedosophia and Menlo Ventures. axios.link/4cj63KZ

• Blacksmith, an SF-based AI code-testing platform, raised $45m in Series B funding at a $550m valuation. Peak XV Partners led, joined by insiders GV and YC. axios.link/4grAJft

🚑 Remepy, an NYC-based biotech pairing prescription medicines with therapeutic software, raised $36m in Series A funding, per Axios Pro. O.G. Venture Partners and M Ventures led, joined by NFX, Vine Ventures, Qumra Capital, TechAviv, 97212 Ventures, Fresh Fund, PsyMed Ventures, Tadmor Group, and IT-Farm Corp. axios.link/4xdCSSh

• Pathway, a Palo Alto, Calif.-based AI lab focused on "post-transformer architecture," raised $30m in seed funding at a $500m valuation from Id4 Ventures, TQ Ventures, Red Bridge Ventures, Kadmos Capital, and WS Investment Co. axios.link/4zjjVir

• ApartmentIQ, a Madison, Wis.-based market intelligence and revenue management platform for the multifamily industry, raised $25m from insider Susquehanna Growth Equity. axios.link/4xrHbce

• Clear Jet, a provider of parcel logistics infrastructure and orchestration, raised $25m. Edison Partners led, joined by insiders Venture53, Origin Ventures, Salt VC, and SpringTime Ventures. axios.link/4xzaA4f

• Princeton Critical Minerals, a lithium production startup, raised $11m in Series A funding. SOSV led, joined by The Grantham Foundation, Prospect Innovation, Astor Management AG, Black Forest Ventures, and the New Jersey Economic Development Authority. axios.link/4wVyNBK

• Noosphere Labs, a Seattle-area physical AI startup, raised $10.25m. Trilogy Equity Partners led, joined by Madrona. axios.link/4wrzYYO

• River Markets, a prime broker for prediction markets, raised $8.5m in seed funding led by Haun Ventures. axios.link/4xU9y39

• Reservoir, a water heater maker, raised $8m in seed funding. Asymmetric Capital Partners led, joined by Founder Collective and MCJ. axios.link/4zhYs9C

• Cytix, a U.K. software change risk startup, raised $7m in Series A funding led by Northern Gritstone. axios.link/4bKH8zS

• Entravel Group, a white-label travel platform with a stablecoin play, raised $7.5m. Ethereal Ventures and Finality Capital led, joined by GSR, Varrock, G1 Ventures, Seier Capital, Veris Ventures, Funfair Ventures, and WTG Ventures. axios.link/4qmdffd

• Fisent Technologies, a Canadian developer of AI process automation software for regulated enterprises, raised C$4.3m. Fintop led, joined by Pegasystems. axios.link/45mY8bL

• Soctera, an Ithaca, N.Y.-based maker of wireless signal amplifiers, raised $4m in seed funding from Anorak Ventures, Multiball Capital, 9Yards Capital, Mana Ventures, and Red Bear Ventures. axios.link/4qdmCxQ

• FriskAI, an LA-based runtime intelligence platform, raised a $3.6m pre-seed round. MaC Venture Capital led, joined by Wischoff Ventures. axios.link/3SnTzuS

• Zerolook, a Swiss B2B flight-shopping API, raised €1.6m in pre-seed funding. Playfair led, joined by Vento Ventures, TrueSight Ventures, and Alpha Venture. axios.link/4qdGj8E

🚑 Ayati Devices, an Indian developer of diagnostic devices, raised $1.5m in seed funding led by Inflexor Ventures. axios.link/3UrnyCI

• Air Canada is selling a 25% stake in its Aeroplan loyalty program for C$2.5b to Blackstone, Caisse de Dépôt et Placement du Québec, PSP Investments and British Columbia Investment Management Corp. axios.link/4bKbzWU

• Airo Mechanical, backed by CCMP Growth, acquired Legrande's Enterprises, a specialty plumbing and HVAC firm. axios.link/4hp0fTG

⚾ Apollo Sports Capital is providing $2.6b in equity and debt to the New York Yankees (suck). axios.link/4g6v6Cd

• Baymark Partners bought Meal Prep Sunday, a Vista, Calif.-based meal prep and delivery service. axios.link/45pQb5F

• Blue Owl Capital acquired a minority stake in secondaries manager Hollyport Capital. axios.link/4fUd2fO

🚑 CHG Healthcare, a Utah-based medical staffing agency backed by Ares and Leonard Green, acquired KREWE Anesthesia, a staffing firm specializing in certified registered nurse anesthetists. axios.link/4cySBCM

• Clarendon Capital acquired Elkridge, Md.-based O'Donnell Metal Deck & Bar Joist, in partnership with Ironwood Capital. axios.link/4wT3qrz

• Currier Plastics, a Sheridan Capital Partners portfolio company, acquired Sage Product Development, a medical device engineering, design and development provider. axios.link/4ctpmkL

🚑 Gridiron Capital acquired van den Boom & Associates, a San Diego-based provider of outsourced back-office solutions for life sciences companies. axios.link/4wsJZF8

• Hightower Advisors agreed to acquire Valley Financial Group, an Ambler, Pa.-based wealth manager with around $275m in AUM. axios.link/4gfpZ2O

• Integrated Water Services, an Austin, Texas-based wastewater platform backed by Sciens Water, acquired Advanced Equipment and Services. axios.link/4qfqa2H

• New Heritage Capital invested in PowerRail, an Exeter, Pa.-based maker of aftermarket locomotive parts. axios.link/4xAj0bI

🚑 Sarnova, a Patricia Industries portfolio company, acquired Mercury Medical, a Clearwater, Fla.-based maker of critical care and emergency medical devices. axios.link/4zcSero

DOJ antitrust officials are investigating a deal whereby Kone, a Finnish elevator and escalator maker, would buy Germany's TK Elevator for €29.4 billion from Advent International and Cinven. BFD flashback.

• Joby Aviation (NYSE: JOBY) agreed to buy Ohio-based defense contractor Resonant Sciences for $500m in cash ($450m) and stock. Sellers include Cerberus Capital Management. axios.link/4wr0x0e

• ACV Auctions (NYSE: ACVA), an online car marketplace with around a $1.3b market cap, is exploring a sale, per Bloomberg. axios.link/4z3lwsm

• Curaleaf (TSX: CURA) is prepping a $272m hostile takeover bid for rival Aurora Cannabis (TSX: ACB). axios.link/4q7L3MY

• eToro (Nasdaq: ETOR) agreed to acquire TradeZero, a U.S.-focused online brokerage serving active traders, for up to $231m in cash and stock. axios.link/4g1pzg5

• Goldman Sachs agreed to acquire NEOS Investments, an ETF manager with $30b in assets, for up to $2.25b. axios.link/4qaixdP

• National CineMedia (Nasdaq: NCMI) agreed to acquire Captivate, an NYC-based operator of digital video elevator and lobby advertising, for $275m. axios.link/4wjmPRh

• Uber (NYSE: UBER) divested its remaining stake in Serve Robotics (Nasdaq: SERV), due to strategic differences over deployment. axios.link/3TLIiVH

• Accel raised $3.5b in new funds, including a $1.35b global expansion fund, $800m for a U.S. fund, $800m for a Europe/Israel fund, and $550m for an India fund. axios.link/4grAgdd

• Layer Global, a new firm led by Anton Levy (ex-General Atlantic), held a $1.1b first close on its debut fund. axios.link/4xA1nbM

• Scott Collins has transitioned to a senior advisor role at Summit Partners, after more than 30 years with the firm. axios.link/4zbd0rg

• Michael Keeley joined Orrick as global head of capital markets. He previously was with Kirkland & Ellis. axios.link/4zrp2NA

• Eliza Oshana McGrath joined Tayeh Capital Group as head of IR and capital formation. She previously was with Northern Trust Asset Management. axios.link/4g7A9lU

• Jarret Rutstein joined LLCP as an associate director. He previously was with Alvarez & Marsal Capital. axios.link/4wWkNYI

The Consumer Price Index climbed 0.1% in July, for an annual rate of 3.4%. This was in line with U.S. inflation expectations.

• Core CPI, which strips out food and energy, also met expectations by rising 0.2% for the month and 2.5% year-over-year.
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