May 18, 2017

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

• Your memories: Five years ago this morning I had a pretty simple plan: Go to a coffee shop, publish a post on Facebook's first post-IPO trades and then go see some nearby house that a realtor thought J and I would like. But none of it worked out as planned.

The first Facebook trades didn't come until around 11:30, due to technical troubles at the NASDAQ. That also meant I missed the house visit, and instead had to settle for a later appointment at a different abode that the realtor felt would be less appealing.

In the proceeding five years, as Axios details, Facebook has gone from a troubled public security into one of the world's most valuable companies. Its revenue has climbed 422% to $27.6 billion. Its daily active users have climbed 107% to 1.28 billion. Its young and awkward CEO has transformed himself into a mature statesman. And I'm writing this from the second house.

Smart CEOs remind their companies ― and us media jackals ― that IPOs are a beginning rather than a conclusion, and that whatever happens to the stock in those early days is much less important than ongoing execution of the core business mission. Present needn't be prologue. Facebook epitomizes that lesson.

• Endowment evolution: Eduard van Gelderen is stepping down as CEO of the $480 billion Dutch pension APG Asset Management, in order to take the number two investment spot at the University of California Regents, according to a memo quietly posted last night (a broader announcement is expected shortly). Among his UC responsibilities will be to manage a $52 billion public equity portfolio and $1 billion real assets portfolio.

• Counter-anecdotal: It's felt like there has been a recent surge in large venture deals involving both Asia-based companies and Asia-based investors (particularly groups like Tencent). So I asked PitchBook for some data, which came back in the opposite direction.

  • Q1 investments in Asia-based companies by Asia-based investors fell between 2015 and 2016, in terms of total dollar volume, deal number and average deal size.
  • Same for investments in U.S.-based companies by Asia-based investors ($4b into 147 companies vs. $1.47b into 112 companies)
  • U.S. VCs also slowed their pace in terms of Asia-based investments, although deal sizes increased.

• VC tumult? From a reputable early-stage investor: "There's a general weirdness in the market. I've had more term sheets pulled or re-traded in the last month than in the last 10 years."

The BFD

Grupo Lala of Mexico is the lead bidder for Stonyfield Farms, the U.S. organic yogurt unit of Danone (Paris: BN), according to the Wall Street Journal. No word yet on price, although China's Inner Mongolia Yili Industrial Group previously said that it planned to offer $850 million.

  • Why it's the BFD: Danone is selling Stonyfield to secure regulatory approval for its planned $10.4 billion purchase of WhiteWave Foods (NYSE: WWAV), a deal that would double Danone's U.S. business and which represents its largest acquisition in a decade.
  • Bottom line: "Grupo Lala's pursuit of Stonyfield comes at a time when the Mexican company and food producers more generally face increasing pressure to offer healthier foods as consumer tastes change. Grupo Lala generates a little more than 60% of its sales from traditional milk products, but the company's faster-growing segment is the one that offers yogurt, cheese and cream." ―Ben Dummett
Venture Capital Deals

• QASymphony, an Atlanta-based provider of agile testing solutions to large enterprises, has raised $40 million in Series C funding led by Insight Venture Partners. http://bit.ly/2ruBNVI

• Wandera, a San Francisco-based mobile security company, has raised $27.5 million in combined Series C equity and debt financing. Sapphire Ventures led the equity piece, and was joined by return backers Bessemer Venture Partners and 83North. www.wandera.com

• Verse, a Barcelona-based mobile payment company, has raised $20 million in new VC funding led by Spark Capital. www.joinverse.com

• Cheddar, a New York-based online video network for business and tech news, has raised $19 million in Series B funding at an $85 million post-money valuation. Raine Ventures led the round, and was joined by AT&T, Amazon, Altice USA, the New York Stock Exchange, Broadway Video Ventures and return backers Lightspeed Venture Partners, Comcast Ventures and Ribbit Capital. http://bit.ly/2qSIFPz

• KeepTruckin, a San Francisco-based provider of electronic logs and fleet management solutions for the trucking industry, has raised $18 million in Series B funding. Scale Venture Partners led the round, and was joined by Google Ventures and Index Ventures. http://reut.rs/2pZlVs0

• Tiqets, a Dutch online ticketing startup focused on live events and museums, has raised $17 million in Series B funding led by HPE Growth Capital. http://bit.ly/2ruAyFT

• Brit+Co, a San Francisco-based digital media and ecommerce site for women and girls, has raised $15 million in new VC funding. Verizon Ventures led the round, and was joined by DMGT, Intel Capital, Lerer Hippeau Ventures, Oak Investment Partners, Marissa Mayer and Gary Vaynerchuk. http://tcrn.ch/2qAk27j

• JobTeaser, a Paris-based online recruitment platform that is integrated with hundreds of European universities, has raised €15 million in new VC funding. Alven Capital led the round, and was joined by IDinvest and Korelya Capital. http://bit.ly/2qVcLBR

• Slice, a New York-based local pizzeria ordering platform, has raised $15 million in Series B funding. GGV Capital led the round, and was joined by return backer Primary Ventures. http://bit.ly/2qwpKXJ

• Yopa, a UK-based provider of online real estate services, has raised £15 million in Series B funding. Daily Mail and General Trust led the round, and was joined by Grosvenor Hill Ventures. http://bit.ly/2rrg9Bl

• Appear Here, a UK-based marketplace for short-term retail space, has raised $12 million in Series B funding. Octopus Ventures led the round, and was joined by Simon Property Group and return backers Balderton Capital, MMC, Meyer Bergman and Playfair Capital. http://tcrn.ch/2rijG7T

• Aporeto, a San Jose, Calif.-based provider of "cloud-native security" solutions, has raised $11.2 million in Series A funding led by Norwest Venture Partners. Existing backers include Data Collective and Wing Venture Capital. www.aporeto.com

• Numerated Growth Technologies, a Boston-based real-time commerce platform for banks, has raised $9 million in Series A funding co-led by Venrock and Cultivation Capital. http://bit.ly/2qpSanS

• The Farmer's Dog, a New York-based pet food subscription service, has raised $8.1 million in Series A funding. Shasta Ventures led the round, and was joined by return backers Forerunner Ventures, Collaborative Fund and SV Angel. http://tcrn.ch/2qUzeyU

• LogicStream Health, a Minneapolis-based provider of clinical process improvement solutions, has raised $6 million in Series B funding led by Noro-Moseley Partners. http://bit.ly/2ru6ycf

• Qupital, a Hong Kong-based online invoice discounting exchange, has raised $2 million in seed funding. MIndWorks Ventures and Alibaba Entrepreneurs Fund co-led the round, and were joined by DRL Capital and Aria Group. http://tcrn.ch/2ruoIdW

• Guesty, a Walnut, Calif.-based platform for professional property managers in the short-term rental business, has raised $3 million in Series A funding. Buran Venture Capital led the round, and was joined by Magma Venture Partners and AltalR Capital. www.guesty.com

• Brava, a Redwood City, Calif.-based IoT software and hardware startup focused on the home, has raised an undisclosed amount of Series B funding. TPG Growth led the round, and was joined by The Rise Fund, ), Lightspeed Venture Partners, Next Coast Ventures, Lead Edge Capital, DGNL Ventures and return backer True Ventures (which led Brava's $12m Series A last year). http://tcrn.ch/2pWptLQ

• DeePhi Tech, a Chinese deep-learning startup, has raised an undisclosed amount of Series A funding from Tsinghua Holdings Corp., Sigma Square Capital, Xilinx, MediaTek, GSR Ventures and Banyan Capital. http://bit.ly/2rutJ7f

Private Equity Deals

• Apax Partners has agreed to acquire Safetykleen Europe, a UK-based provider of oil collection, recycling and other waste management solutions, from Warburg Pincus. No financial terms were disclosed, although earlier reports suggested that the deal could be valued at around €640 million.

• Ares Management and The Blackstone Group have made takeover offers for Fidelity & Guaranty Life (NYSE: FGL), an Iowa-based insurer with a current market cap of around $1.6 billion, according to Bloomberg. https://bloom.bg/2ruzPV8

• Boyd Corp., a Modesto, Calif.-based portfolio company of Genstar Capital, has acquired Aavid Thermalloy, a Laconia, N.H.-based maker of thermal management solutions, from Audax Private Equity for an undisclosed amount. www.aavid.com

• The Carlyle Group has partnered with Swiss trading firm Glencore to bid on Morocco's only oil refinery, to which they had lent $600 million before the facility went bankrupt, according to Reuters. http://reut.rs/2qwfhxh

• Hellman & Friedman has offered to purchase Australian newspaper and online classifieds company Fairfax Media (ASX: FXJ) for around A$3 billion, or at a slight premium to an earlier bid led by TPG Capital. http://bit.ly/2qwlXvz

• Nautic Partners has agreed to acquire Endries International, a Brillion, Wis.-based distributor of fasteners and class-C parts for OEMs, from Ferguson Enterprises. No financial terms were disclosed. www.endries.com

Public Offerings

• Argenx, a Dutch developer of antibody-based therapies for the treatment of severe autoimmune diseases and cancer, raised $100 million in its IPO. The company priced 5.9 million shares at $17 per share, and will trade on the Nasdaq under ticker symbol ARGX. Cowen & Co. was listed as left lead underwriter. Shareholders include Forbion Capital (10.56% pre-IPO stake), Life Sciences Partners (8.52%), Federated Investors (7.36%), Shire (7.01%) and Percentive Advisors (5.59%). www.argen-x.com

• Bright Scholar Education, an operator of international and bilingual schools in China, raised $158 million in its IPO. The company priced 15 million shares at $10.50 per share (above $8-$10 range), and will trade on the NYSE under ticker symbol BEDU. Morgan Stanley and Deutsche Bank served as lead underwriters. BSE reports under $1 million in net income on $151.5 million in 2016 revenue.

• G1 Therapeutics, a Chapel Hill, N.C.-based developer of small molecules for use in cancer therapy and biodefense applications, raised $105 million in its IPO. The pre-revenue company priced 6.3 million shares at $15 per share (low end of $15-$17 range, for an initial market cap of $460 million. It will trade on the Nasdaq under ticker symbol GTHX, while J.P. Morgan and Cowen & Co. served as lead underwriters. Shareholders include Hatteras Venture Partners (19.79% pre-IPO stake), MedImmune Ventures (16.7%), Ashelman Ventures (15.38%), RA Capital (10.66%), Lumira Capital (7%), Cormorant Asset Management, Aju IB Investment, Cowen Private Investments, Franklin Templeton Investments, Rock Springs Capital, Mountain Group Capital and Tavistock Life Sciences. www.g1therapeutics.com

• Synlogic, a Cambridge, Mass.-based developer of medicines based on a synthetic biology and microbiome platform, is going public via a reverse merger with Mirna Therapeutics (Nasdaq: MIRN), a failed cancer drug developer. Synlogic has raised over $100 million in VC funding, from firms like OrbiMed, NEA and Atlas Venture. http://bit.ly/2qwhDwq

• Veritone, a Newport Beach, Calif.-based AI platform for analyzing audio and video data, raised $37.5 million in its IPO. The company priced 2.5 million shares at $15 per share, and will trade on the Nasdaq under ticker symbol VERI. Wunderlich served as lead underwriter. The company reports a $23 million net loss in 2016 on nearly $9 million in revenue. www.veritone.com

Liquidity Events

• KKR is considering the sale of its 41% equity stake in Norwegian enterprise software company Visma Group for upwards of €1 billion, according to the WSJ. http://bit.ly/2qv8ZxJ

• Sun Capital Partners has hired Rothschild to find a buyer for British bedding retailer Dreams, with Chinese companies Mlily and King Koil China expected to bid, according to China Daily. A deal could be worth around £400 million. http://bit.ly/2qVm1Gk

More M&A

• B. Riley Financial (Nasdaq: RILY) has agreed to acquire Memphis-based Wunderlich Securities for $67 million. www.wunderlichonline.com

• Lowe's Cos (NYSE: LOW) has agreed to acquire Maintenance Supply Headquarters, a Houston-based wholesale retailer of maintenance supplies, for $512 million. http://reut.rs/2qAbwF7

• SiriusXM (Nasdaq: SIRI) is in talks to acquire online radio company Pandora (NYSE: P), according to the NY Post. Pandora has a current market cap just north of $1 billion. http://nyp.st/2rhlTAx

Fundraising

• Bain Capital Ventures has committed to making a small number of angel investors via AngelList, with an expected annual spend of between $2 million and $5 million. http://reut.rs/2pOtDtW

• Lightspeed China Partners has closed its first RMB-denominated VC fund with RMB600 million (US$87m) in capital commitments. http://bit.ly/2rijVA1

• Morgan Stanley Investment Management has raised more than $125 million for a "global impact" private equity fund-of-funds called Integro. www.morganstanley.com/im

• Vesalius Biocapital, a Luxembourg-based VC firm focused on later-stage life sciences companies, has closed its third fund with over €65 million in capital commitments. www.vesaliusbiocapital.com

It's Personnel

• Adam Nash, former CEO of WealthFront, has rejoined venture firm Greylock as an entrepreneur-in-residence. http://bit.ly/2quBYle

• Post Capital Partners has promoted Christopher Cheang to director and head of business development. www.postcp.com

Final Numbers
Dan Primack