Jul 10, 2020

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

Illustration: Aïda Amer/Axios

Joe Biden yesterday laid out the broad strokes of his economic policy platform, which seemingly is designed to not freak out centrists and not piss off progressives.

  • Why it matters: Biden has a better-than-even shot of becoming the next president, which means his tax plans could become everyone's tax bills.
  • Why it matters a bit less: Even if he wins in November, Biden wouldn't become president until six months from now. It's hard to see how economic prescriptions written in July 2020 — by any candidate — would be fully applicable in January 2021. For context, imagine the irrelevance of most any policy specifics from six months ago, when we were all still at work and school.

What's new: Yesterday he proposed $400 billion in government procurement of U.S.-based goods and services over four years, plus another $300 billion in new spending on U.S.-based tech R&D (with a particular focus on geographies and founder demographics with less access to traditional venture capital).

  • Biden also talked a lot during his speech about how companies need to "end the era of shareholder capitalism," which seems to be a reiteration of last year's Business Roundtable pledge.

What's old: He reiterated several pre-pandemic ideas, such as repealing much of the 2018 tax cuts. This would include upping the corporate tax rate from 21% to 28%, and reverting to prior top marginal rates for individuals.

  • Biden didn't specifically discuss carried interest or capital gains yesterday, but previously has said he'd like to eliminate the carried interest loophole and the preferential treatment for capital gains for high earners.
  • But, but, but: Both Presidents Obama and Trump campaigned on closing the carried interest loophole, yet it's still there. That said, the capital gains move would be a backdoor to impacting carried interest.

What's not in there: There's no wealth tax, Green New Deal, M&A moratoriums, or Medicare for All. There also aren't explicit pay-fors for the $700 billion in new spending, but such things are becoming increasingly passé.

🎧 Go deeper: "Axios Re:Cap" yesterday spoke with Biden campaign adviser Penny Pritzker, the former U.S. Commerce Secretary who also leads PSP Investments. Listen via Apple or via Axios.

The BFD

Illustration: Aïda Amer/Axios

ByteDance is considering new corporate structures for its TikTok business, as it comes under political pressure in the U.S. and other countries for ties to China's government, per the WSJ.

  • Why it's the BFD: Beijing-based ByteDance is the world's most valuable privately held tech company, estimated to be worth upwards of $110 billion by direct investors and $150 billion in recent secondary market trades.
  • Cap table: ByteDance shareholders include General Atlantic, Sequoia Capital China, KKR, Hillhouse Capital, and Yuri Milner.
  • Listen up: "Axios Re:Cap" recently dug into the TikTok economy with Shots Studios CEO John Shahidi. Via Apple Podcasts or Axios.com.
  • The bottom line: "ByteDance’s discussions about changing how TikTok is run are still in their early stages, but setting up an independent TikTok management board would allow a degree of autonomy from the parent company." — Liza Lin & Shan Li, WSJ
Venture Capital Deals

Rivian, a Plymouth, Mich.-based electric truck-maker, raised $2.5 billion. T. Rowe Price led, and was joined by Soros Fund Management, Fidelity, Baron Capital, and return backers Amazon and BlackRock. http://axios.link/pYpW

Perfect Day, an animal-free dairy, raised $160 million in new Series C funding (round total now $300m). CPP Investments led, and was joined by Temasek and Horizons Ventures. http://axios.link/HH2Y

🚑 Harbour BioMed, a cancer drug startup with offices in China and Massachusetts, raised $103 million in Series C funding. Hudson Bay Capital led, and was joined by OrbiMed, Country Garden VC, GTJA Investment Group, Octagon Capital, and Sage Partners. http://axios.link/DgbU

Taulia, a San Francisco-based B2B payments platform, raised $60 million. Ping An led, and was joined by JPMorgan, Prosperity7 Ventures, and return backer Zouk Ventures. http://axios.link/olzA

🚑 Tranquis Therapeutics, a San Mateo, Calif.-based immuno-neurology startup, raised $30 million in Series A funding. Remiges Ventures and SR One co-led, and were joined by from Vivo Capital, Hillsborough Venture, and Correlation Ventures. http://axios.link/fneZ

🚑 Inimmune, a Missoula, Mont.-based developer of adjuvants for vaccines, raised $22 million in Series A funding led by Two Bear Capital. http://axios.link/Vobt

🚑 LumiThera, a Seattle-based developer of medical devices for ocular disorders, raised $14 million in Series C funding. WaterStar Capital led, and was joined by Imagine Ventures, Keiretsu Capital, Water Star Mercury Fund, Nikon Corp., and Celeste Management. http://axios.link/7nY6

Traplight, Finnish mobile gaming studio, raised €8 million led by EQT Ventures. http://axios.link/M6KA

Aryballe, a French digital olfaction startup, raised €7 million from Samsung Ventures, Seb Alliance, Innovacom, Cemgas Invest, HCVC, and Asahi Kasei. www.aryballe.com

FitXR, a London-based VR fitness startup, raised $6.3 million. Hiro Capital led, and was joined by return backers BoostVC, Maveron and TenOneTen Ventures. http://axios.link/j2qJ

Quaestor, an automated financial data platform for startups and their investors, raised $5.8 million in seed funding. 8VC led, and was joined by Spark Capital, Abstract Ventures, GFC, Fathom Ventures, and Riot Ventures. www.quaestor.com

Nuggs, a maker of plant-based chicken products, raised $4.1 million led by Lerer Hippeau. www.eatnuggs.com

Icon Savings Plan, a Portland-based provider of employee retirement savings plans, raised $3.2 million in seed funding. Tom Blaisdell led, and was joined by Rethink Impact, TASC Ventures, Kelly Innovation Fund, Portland Seed Fund, and Alumni Ventures. http://axios.link/yi1h

InOrbit, a Mountain View-based provider of robot management software, raised $2.6 million in seed funding led by Animo Ventures. http://axios.link/YvnX

Amie, a Berlin-based productivity app, raised $1.3 million from Creandum and Tiny VC. http://axios.link/JJ2j

Private Equity Deals

🚑 Metlifecare, a listed New Zealand retirement village operator, agreed to a downwardly revised takeover offer by EQT Partners. The deal value is now NZ$1.28 billion, versus an original price of NZ$1.49 billion. http://axios.link/BqUZ

Platinum Equity acquired the distribution unit of Deluxe Entertainment Services, which provides solutions to content production studios and distributors.

Round Table Capital Partners invested in Hull & Associates, an environmental and engineering consultancy in the Midwest and mid-Atlantic regions. www.hullinc.com

Sonoma Brands acquired New York-based meat snacks brand Chef’s Cut Real Jerky Co. www.chefscutrealjerky.com

Public Offerings

China Bohai Bank raised $1.78 billion via the year’s largest IPO in Hong Kong, per Reuters. http://axios.link/9ZO2

Marqeta, an Oakland-based card issuing platform, is interviewing banks for an IPO, per Reuters. The company has raised $525 million in VC funding, most recently at a $4.3 billion valuation, from Goldman Sachs, Coatue Management, Vitruvian Partners, Visa, 83North, Granite Ventures, and Iconiq Capital .http://axios.link/EFAC

Trean Insurance Group, a Wayzata, Minn.-based workers’ comp insurer, set IPO terms to 10.7 million shares at $13–$15. It would have an initial market cap of $716 million, were it to price in the middle, and plans to trade on the Nasdaq (TIG). http://axios.link/xyFB

🐔 Vital Farms, an Austin, Texas-based producer of pasture-raised eggs and butter, filed for a $100 million IPO. It plans to trade on the Nasdaq (VITL) with Goldman Sachs as lead underwriter, and reports $3.3 million of net income on $141 million in revenue for 2019. Shareholders include Manna Tree Partners (8.2% pre-IPO stake), SJF Ventures (8.2%), and Arborview Capital Partners (6.6%). http://axios.link/MZ0W

Update: A spokesperson for Ant Financial disputed yesterday's Reuters report that the company is working toward a 2020 IPO.

Liquidity Events

🚑 Apax Partners is seeking a buyer for German drugmaker Neuraxpharm, which could fetch between €1.2 billion and €1.4 billion, per Reuters. http://axios.link/HR1m

More M&A

Epic Games, the North Carolina-based owner of Fortnite, raised $250 million from Sony for a 1.4% stake. http://axios.link/9WUr

Freshworks, a San Mateo, Calif.-based customer support software company valued by VCs at $3.5 billion, bought Flint, an India-based IT orchestration and cloud management platform. http://axios.link/VV15

Mubadala Investment Co. is entering exclusive talks to buy Brazil’s second-largest refinery from Petrobras. http://axios.link/6rNy

Muji U.S., a lifestyle retailer owned by Japan's Ryohin Keikaku (Tokyo: 7453), filed for Chapter 11 bankruptcy protection. http://axios.link/EuSi

Fundraising

Apollo Global Management is raising $3.5 billion for its second infrastructure opportunities fund, per an SEC filing. http://axios.link/9hj6

🚑 The Blackstone Group closed its debut life sciences fund with $4.6 billion. http://axios.link/YGIQ

It's Personnel

Elliott Weinstein and David Groban joined Searchlight Capital as managing directors. Weinstein previously was with Centerbridge Capital Partners, while Groban was with Warlander Asset Management. www.searchlightcap.com

Hjalmar Winbladh is leaving EQT Ventures, the Stockholm-based firm he co-founded in 2016, per TechCrunch. http://axios.link/j86Y

Final Numbers
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Data: FactSet; Chart: Axios Visuals

Go deeper: Worries grow over Nasdaq divergence

Dan Primack

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