Nov 14, 2019

Axios Pro Rata

By Dan Primack
Dan Primack

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Top of the Morning

Illustration: Eniola Odetunde/Axios

Deval Patrick made it official this morning, announcing that he'll run for the Democratic Party's presidential nomination.

  • Sources say he decided late this past weekend and formally resigned yesterday from Bain Capital, which he joined in 2015 to launch and lead a platform focused on "social impact investing."
  • That group, called Bain Double Impact, is in the midst of raising its second fund. Prospective investors tell me that Patrick had assured them he wouldn't run for president in 2020, although left the door open for the 2024 race.
    • Bain raised around $350 million for its first Double Impact Fund, of which a little over two-thirds is deployed into 11 portfolio companies.
    • There have been two exits so far (IPO for SpringWorks Therapeutics and sale of Impact Fitness to Morgan Stanley).
  • It's unclear if Patrick's departure will impact commitments to the fund, which is said to be targeting around $600 million.
    • There hasn't been a formal first close yet, although there have been verbal commitments that could be revisited.
    • Patrick's co-managing partner Todd Cook will become sole managing partner.
  • A Bain spokesman declined comment.

Twitter is already ablaze with Democrats who can't understand how a "private equity guy" expects to get the nomination in 2019, let alone one from the same firm that Mitt Romney founded.

  • Expect rivals to scrutinize Bain Double Impact's portfolio for employee complaints, customer complaints, and anything that doesn't scream "positive social impact."
  • My guess is the first one to come up might be for-profit educator Penn Foster, which experienced some scandal before Bain got involved.

Patrick, who defended Bain Capital during Romney's presidential run, told me upon joining Bain that he wasn't worried about what the firm's brand could mean for his future political aspirations. Now he's going to put that puzzling confidence to the test.

Also...

WeWork yesterday reported soaring revenue and losses, with annual revenue run-rate climbing to $4.2 billion and the quarterly loss hitting $1.25 billion.

  • The real reporting challenge will come in three months, when WeWork's quarterly results will reflect its new, slower-growth strategy.
  • WeWork's largest rival in China, Ucommune, is planning to go public in the U.S. next month, per Bloomberg. There had been an October report that the company had filed confidential IPO docs with the SEC.

The Supreme Court on Tuesday denied Remington's effort to block a liability lawsuit brought by families of victims of the Sandy Hook massacre, where a Remington-made AR-15 was used.

  • Remington was owned by Cerberus Capital Management at the time of Sandy Hook, but last year filed for bankruptcy and was handed over to creditors.
  • In other gun biz news, Smith & Wesson will be spun out into an independent company by parent American Outdoor Brands (Nasdaq: AOBC), according to an announcement made yesterday.

🎧 Pro Rata Podcast spoke with Goldman Sachs retail bank CEO Carey Halio about the allegations of gender bias against the Apple credit card, issued by Goldman. Listen here.

The BFD
Source: Giphy

Docker, a San Francisco-based software container platform, sold its enterprise business to VC-backed Mirantis, and also raised $35 million in new funding from return backers Benchmark and Insight Partners.

  • Why it's the BFD: Docker was a high-flying unicorn not too long ago, even viewed as a promising IPO candidate, but has since had its wings clipped and stall moved over with the middling mares.
  • Shakeup: Docker also named its third CEO of 2019, promoting chief product officer Scott Johnston to succeed Rob Bearden.
  • Bottom line: "Docker’s fortunes changed quite a bit over the years, from leading the container revolution to becoming somewhat of an afterthought after Google open-sourced Kubernetes and the rest of the industry coalesced around it." — Frederic Lardinois, TechCrunch
Venture Capital Deals

1Password, a 14 year-old online password manager, raised $200 million in Series A funding. Accel led, and was joined by Slack Fund. http://axios.link/M4DQ

ACV Auctions, a Buffalo, N.Y.-based wholesale auto auction site, raised $150 million in Series E funding at a valuation north of $1 billion. Wellington Management and Fidelity co-led, and were joined by return backers Bain Capital Ventures, Bessemer Venture Partners and Tribeca Venture Partners. http://axios.link/qJkY

Freshworks, a San Mateo, Calif.-based provider of customer support software, raised $150 million in Series H funding at a $3.5 billion valuation from return backers Accel, CapitalG, and Sequoia Capital. http://axios.link/qbRR

Moveworks, a Mountain View-based provider of automated employee IT support services, raised $75 million in Series B funding. ICONIQ Capital, Kleiner Perkins, and Sapphire Ventures were joined by return backers Lightspeed Venture Partners, Bain Capital Ventures, and Comerica Bank. http://axios.link/jxVO

SheerID, a Portland, Ore.-based marketing ID verification company, raised $64 million. CVC Growth Partners led, and was joined by return backers Centana Growth Partners and Voyager Capital. http://axios.link/Dk9v

Eigen Technologies, a London-based provider of document data extraction and analysis software for banks, raised $37 million in Series B funding. Lakestar and Dawn Capital co-led, and were joined by Temasek and Goldman Sachs. http://axios.link/O6Jt

DroneDeploy, a San Francisco-based drone mapping and analytics platform, raised $35 million in Series D funding. Bessemer Venture Partners led, and was joined by Energize Ventures, AirTree, Emergence Capital, Scale Venture Partners, and Uncork Capital. http://axios.link/GHAa

Liqid, a Broomfield, Colo.-based composable infrastructure hardware and software platform, raised $28 million in Series B funding. Panorama Point Partners led, and was joined by Iron Gate Capital and DH Capital. http://axios.link/drwp

Apervita, a Chicago-based healthcare analytics platform, raised $22 million from Optum Ventures, Pritzker Group VC, Baird Capital, Math Ventures, Levy Family Partners, Illinois Ventures, and Wintrust. http://axios.link/uHwL

PostProcess Technologies, a Buffalo, N.Y.-based provider of automated finishing solutions for 3D-printed products, raised $20 million in Series B funding led by Paychex founder Tom Golisano. http://axios.link/aiSe

Travelio, an Indonesian apartment rental platform, raised $18 million in Series B funding co-led by Pavilion Capital and Gobi Partners. http://axios.link/tQCM

AMP Robotics, a Denver-based developer of robots for sorting recyclable materials, raised $16 million in Series A funding. Sequoia Capital led, and was joined by BV, Closed Loop Partners, Congruent Ventures, and Sidewalk Labs. http://axios.link/dItu

Emerge, a Los Angeles-based immersive content platform, raised $12 million in Series A funding. M13 led, and was joined by Vulcan Capital and LionTree Partners. www.emerge.io

Pcysys, an Israeli cybersecurity risk validation startup, raised $10 million in Series A funding from Awz Ventures and The Blackstone Group. http://axios.link/TQUf

DadeSystems, a Miami, Fla.-based provider of receivables software, raised $9 million in Series B funding. Napier Park Financial Partners led, and was joined by return backers Fifth Third Capital Holdings and Ocean Azul Partners. www.dadesystems.com

🚑 Risalto Health, a New York-based digital health services startup focused on musculoskeletal care, raised $7 million from Health Catalyst Capital Management and Oxeon Venture Studios. http://axios.link/J9cB

Peanut, a social network for moms, raised $5 million. Index Ventures led, and was joined by Sweet Capital, Greycroft, Sound Ventures, Female Founders Fund, Felix Capital, and Partech. http://axios.link/rRZH

Snowplow Analytics, a London-based customer data collection platform, raised £4 million in first-round funding led by MMC Ventures. http://axios.link/Ssnl

Wappier, a Greek mobile game monetization startup, raised $4 million in seed funding led by Counterview Capital. http://axios.link/M5B2

JetPack Aviation, a developer of flying motorcycles (come on, you know you want one), raised over $2 million in seed funding from Draper Associates, YC, and Cathexis Ventures. http://axios.link/hnT3

Private Equity Deals

Advent International agreed to buy Mariana Tek, a Washington, D.C.-based provider of business management software for the fitness market. www.marianatek.com

DouglasBay offered to buy a 51% stake in British logistics group Eddie Stobart (AIM ESL) for around £55 million. http://axios.link/0L6V

🚑 FFL Partners formed Orthodontic Partners, a Grand Rapids, Mich.-based orthodontic services organization.

🚑 Leonard Green & Partners agreed to sponsor a recap of Princeton, N.J.-based clinical trial services company WCG, alongside existing backers Arsenal Capital Partners and new investor Novo Holdings. The deal values WCG at around $3.1 billion, per Reuters. http://axios.link/iLhL

New Mountain Capital acquired Horizon Group Services, a provider of residential HVAC, plumbing and electrical services, from Sun Capital Partners. http://axios.link/KqFM

Public Offerings

Canaan, a Chinese cryptocurrency mining equipment maker, set IPO terms to 10 million shares being offered at between $9-$10. It had originally filed for a $400 million offering. At the midpoint of its range, Canaan would have an initial market cap of $1.6 billion, and plans to trade on the Nasdaq (CAN) with Credit Suisse as lead underwriter. http://axios.link/cOnB

OneConnect, a Chinese provider of operations management software for financial firms, filed for a $100 million IPO. It plans to trade under ticker OCFT, with Morgan Stanley as lead underwriter. OneConect is being spun out of Ping An Insurance, and reports $217 million of revenue for the first nine months of 2019. http://axios.link/m0Ps

YayYo, a fleet management and auto rental platform for ridesharing drivers, raised $11 million in its IPO. The company priced 2.6 million shares at $4, for an initial market cap of $118 million. It will trade on the Nasdaq (YAYO) with Aegis Capital and WestPark Capital as underwriters. http://axios.link/qVDn

Liquidity Events

TPG and Providence Equity Partners are seeking a buyer for RentPath, an Atlanta-based provider of online home rental guides, per Bloomberg. www.rentpath.com

More M&A

CRH (Ireland: CRG) hired JPMorgan to help it find a buyer for its Philippines cement business, which could net between $2 billion and $3 billion, per Bloomberg. http://axios.link/N70B

Carl Icahn bought a $1.2 billion stake in HP (NYSE: HPQ) and will push for the company to accept a takeover offer from Xerox (NYSE: XRX). http://axios.link/Vl9t

🚑 Thermo Fisher Scientific (NYSE: TMO) has approached German genetic testing company Qiagen (NYSE: QGEN) about a takeover, per Bloomberg. Qiagen has a market cap of around $8 billion. http://axios.link/zIWY

Yahoo Japan, controlled by SoftBank, is in talks to merge with Japanese messaging app operator Line Corp. (Tokyo: 3938). http://axios.link/cTPj

Fundraising

Norwest Venture Partners raised $2 billion for its fifteenth fund. http://axios.link/dKm3

It's Personnel

Michael Schechter joined Ares Management as a partner and head of credit trading. He previously was with Morgan Stanley. www.aresmgmt.com

Carl Theobald joined Gryphon Investors as an operating partner. He previously was CEO of SaaS companies 2checkout, FollowAnalytics, and RichRelevance. www.gryphoninvestors.com

Final Numbers
Expand chart
Adapted from Brookings; Map: Axios Visuals
Dan Primack

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