Jun 22, 2021

Axios Pro Rata

🙏 Axios Re:Cap focuses on Iran's newly elected president, including what he means for his people and the U.S. Take a listen.

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Top of the Morning

Illustration: Aïda Amer/Axios

The Blackstone Group was once America's largest landlord, scooping up tens of thousands of single-family homes in the aftermath of the 2009 subprime mortgage crisis. Now it's coming back, but at a market peak instead of at a market trough.

Driving the news: Blackstone this morning announced that it will pay around $6 billion to purchase Home Partners of America, a Chicago-based owner of more than 17,000 single-family homes.

  • HPA's model is rent-to-own, with lease agreements including pre-set purchase prices that can be exercised with 30-days notice.
  • The company obviously has a large portfolio of homes, but often makes purchases upon renter request.
  • Blackstone is said to have come into the deal via a bank-led process, as HPA had been owned by a group of institutional investors that included BlackRock and KKR.

History: Blackstone's first foray into single-family homes was via Invitation Homes, which eventually had 80,000 single-family properties and went public in 2017.

  • Blackstone exited Invitation in 2019, and returned to the market in a small way last year via a $240 million preferred stock investment in Toronto-listed Tricon Residential.

Thesis: A source close to the deal says that Blackstone is basically betting on the continued supply-and-demand imbalance in U.S. housing, which it doesn't see policymakers successfully addressing any time soon.

  • The firm is buying HPA via a non-traded REIT, which has a longer-term time horizon than its other investment vehicles.
  • In the short-term, it also believes HPA benefits from a model that can help aspiring homeowners ease their way into properties, without having to engage in the current frenzy of all-cash, no inspection offers.

Bonus: Axios Local this morning featured stories on soaring home prices.

The bottom line: Blackstone's conviction in the upside for U.S. housing is apparently higher than the record prices currently being paid.

The BFD

Illustration: Rebecca Zisser/Axios

Sanderson Farms (Nasdaq: SAFM), the country's third-largest poultry producer, is seeking a buyer, per WSJ.

  • Why it's the BFD: This comes against the backdrop of soaring poultry prices, with boneless/skinless breasts up nearly 20% from one year ago and wings up more than 8%. Drivers include increased grain costs, labor shortages and restaurant reopenings.
  • Details: Laurel, Miss.-based Sanderson had a $3.5 billion market cap prior to the WSJ report, but saw shares spike around 7% on the news in aftermarket trading. Centerview Partners is running the process, with commodities trader Continental Grain Co. among the interested suitors.
  • Bottom line: "A deal with Continental would merge Sanderson with Georgia-based Wayne Farms, a poultry producer owned by Continental, forming a company producing about 15% of the country’s chicken meat. No. 2 player Pilgrim’s Pride Corp. produces about 16% of the national total." — Jacob Bunge & Cara Lombardo, WSJ

Venture Capital Deals

Mollie, an Amsterdam-based payments integration startup (i.e. European rival to Stripe), raised €665 million in equity funding at a €5.4 billion valuation. Blackstone Growth led, and was joined by QT Growth, General Atlantic, HMI Capital, Alkeon Capital and TCV. http://axios.link/3sHo

Transmit Security, a Newton, Mass.-based provider of passwordless identity and risk management solutions to brands, raised $543 million in Series A funding at a $2.2 billion valuation. Insight Partners and General Atlantic co-led, and were joined by Cyberstarts, Geodesic, SYN Ventures, Vintage and Artisanal Ventures. http://axios.link/h9SF

🚑 Insilico Medicine, a Hong Kong-based drug development and discovery platform, raised $255 million in Series C funding. Warburg Pincus led, and was joined by CPE, OrbiMed, Mirae Asset Capital, B Capital Group, Deerfield Management, Maison Capital, Lake Bleu Capital, President International Development Corporation, Sequoia Capital China and Sage Partners, Qiming Venture Partners, Pavilion Capital, Eight Roads Ventures, Lilly Asia Ventures, Sinovation Ventures, BOLD Capital Partners, Formic Ventures and Baidu Ventures. http://axios.link/ugBX

GoStudent, a Vienna-based K-12 video tutoring marketplace, raised €205 million in Series C funding at a €1.4 billion valuation. DST Global led, and was joined by SoftBank, Tencent, Dragoneer and insiders Coatue, Left Lane Capital and DN Capital. http://axios.link/gFiZ

G2, a Chicago-based software marketplace, raised $157 million in Series D funding at a $1.1 billion valuation. Permira led, and was joined by HubSpot Ventures, Salesforce Ventures and insiders Accel, Emergence and IVP. www.g2.com

Primer, a San Francisco-based natural language processing platform whose clients include U.S. national security agencies, raised $110 million. Addition led, and was joined by In-Q-Tel. http://axios.link/gYy1

Stronghold Digital Mining, a Kennerdell, Penn.-cryptocurrency miner, raised $105 million from backers like MG Capital and Greg Beard. www.digitalstrongholdmining.com

CommerceIQ, a Palo Alto-based e-commerce merchandising decision platform for consumer brands, raised $60 million in Series C funding. Insight Partners led, and was joined by insiders Trinity Ventures, Shasta Ventures and Madrona Venture Group. www.commerceiq.ai

🚑 Enveda Biosciences, a Boulder, Colo.-based developer of a “drug discovery search engine for dark chemical space,” raised $51 million in Series A funding. Lux Capital led, and was joined by Two Sigma Ventures, Hummingbird VC, Catalio Capital, Lifeforce Capital, True Ventures, Wireframe Ventures and Village Global. www.envedabio.com

Songtradr, a Los Angeles-based music licensing marketplace, raised $50 million in Series D funding. http://axios.link/bLzs

🚑 Cleerly, a New York-based developer of coronary imaging tech, raised $43 million. Vensana Capital led, and was joined by LRVHealth, New Leaf Venture Partners, DigiTx Partners, the American College of Cardiology and Cigna Ventures. http://axios.link/2Wfx

LeafLink, a New York-based business platform for cannabis companies, raised $40 million in Series C funding. Nosara Capital and L2 Ventures co-led, and were joined by Founders Fund and Thrive Capital. www.leaflink.com

Sporttrade, a Philadelphia-based sports betting marketplace, raised $36 million. Jump Capital led, and was joined by Impression Ventures, Hudson River Trading and Tower Research Ventures. www.getsporttrade.com

Aeroseal, a Dayton, Ohio-based developer of building seals to reduce carbon emissions, raised $22 million in Series A funding. Breakthrough Energy Ventures led, and was joined by Energy Impact Partners and Building Ventures. www.aeroseal.com

Majority, a Houston-based provider of mobile banking services for migrants, raised $19 million in seed funding. Valar Ventures led, and was joined by Avid Ventures and Heartcore Capital. www.majority.com

Via, a conversational commerce startup, raised $15 million led by Footwork. http://axios.link/dxOO

👟 SoleSavy, a Vancouver-based online sneaker community, raised US$12.5 million in Series A funding. Bedrock Capital led, and was joined by Diplo, Bessemer Venture Partners, Banana Capital and Roham Gharegozlou. http://axios.link/Ex5w

Ubco, a New Zealand-based electric utility bike startup, raised $10 million co-led by Seven Peak Ventures, Nuance Capital and TPK Holdings. http://axios.link/5Pur

Private Equity Deals

Adenia Partners acquired a majority stake in Herholdt's Group, a South African distributor of low-voltage electrical products and solar products. www.adenia.com

Alliance Technical Group, a Decatur, Ala.-based portfolio company of Align Capital Partners, acquired Horizon Air Measurement Services, a Camarillo, Calif.-based provider of stack testing services. www.alliancetechnicalgroup.com

Bain Capital and The Carlyle Group are among those submitting nonbinding bids for a 70% stake in listed South Korean auto supplier Hanon Systems, per local media reports. A deal could be worth around $5.8 billion. http://axios.link/Vkqx

MeetingPlay, a Frederick, Md.-based hybrid event platform, raised $75 million from Sunstone Partners. www.meetingplay.com

Public Offerings

Blend Labs, a San Francisco-based digital consumer banking platform, filed for an IPO. It plans to list on the NYSE (BLND) and reports a $75 million net loss on $96 million in revenue. Blend raised nearly $700 million, most recently at a $3.3 billion valuation, from backers like Lightspeed Venture Partners (13.3% pre-IPO stake), Formation8 (8.4%), Coatue (5.8%), Tiger Global (5.8%), General Atlantic (5.4%) and Greylock (5.2%). http://axios.link/OImW

Couchbase, a Santa Clara, Calif.-based NoSQL database, filed for an IPO. It plans to list on the Nasdaq (BASE), and reports a $40 million net loss on $103 million in revenue for 2020. Couchbase raised nearly $300 million from firms like Accel (20.9% pre-IPO stake), North Bridge (13.7%), GPI Capital (13%), Mayfield (10.1%) and Adams Street Partners (5.4%). http://axios.link/3WlI

F45 Training, a fitness chain whose SPAC deal collapsed last year, filed for an IPO. It plans to list on the NYSE (FXLV) and reports a $13 million net loss on $93 million in revenue for 2020. Shareholders include Mark Wahlberg (4.6% pre-IPO stake). http://axios.link/gKWT

Full Truck Alliance, a Chinese platform that connects shippers and truckers, raised $1.57 billion in its IPO. The company priced at the top of its $17-$19 range, for a $20.6 billion valuation, plans to list on the NYSE (YMM) and reports a $25 million profit on $396 million in revenue for 2020. It had raised $3.6 billion from firms like SoftBank Vision Fund (22.2% pre-IPO stake) and Sequoia Capital China (7.2%). http://axios.link/3hKC

Membership Collective Group (d.b.a. Soho House), an operator of luxury restaurants and clubs, filed for an IPO. It plans to list on the NYSE (MCG) and reports a $235 million net loss on $177 million in revenue for 2020. Backers include Yucaipa Companies. http://axios.link/zcaS

Ryan Specialty Group, a Chicago-based wholesale specialty insurance brokerage backed by Onex Corp., filed for an IPO. It plans to list on the NYSE (RYAN) http://axios.link/gvCX

Spark Education, a Chinese K-12 online tutoring platform, filed for an IPO. It plans to list on the Nasdaq (SPRK) and reports a $145 million net loss on $179 million of revenue for 2020. The company raised over $550 million, most recently at a $1.5 billion valuation, from firms like Sequoia Capital China (10.5% pre-IPO stake), GGV Capital (8.9%), IDG (8.7%) and Lightspeed China Partners (5.7%). http://axios.link/duPq

🚑 Stevanato Group, an Italian pharma packaging company, filed for an IPO. It plans to list on the NYSE (STVN) and reports €7.2 million of profits on €136 million in revenue for the fiscal year ending March 31, 2021. http://axios.link/8rge

SPAC Stuff

🚑 Pear Therapeutics, a Boston-based developer of prescription apps for treating addiction and insomnia, agreed to go public at an implied $1.6 billion equity value via Thimble Point Acquisition Corp. (Nasdaq: THMA), a SPAC formed by the Pritzker Vlock Family Office. Pear had raised $270 million from SoftBank, Forth Management, Pilot House, Sarissa Capital, Shanda Group, Quad Investment Management, Novartis and return backers Temasek, 5AM Ventures, Arboretum Ventures, JAZZ Venture Partners, CrimsoNox and EDBI. www.peartherapeutics.com

Bleuacacia, a SPAC focused on millennial and Gen Z consumer companies, filed for a $300 million IPO. http://axios.link/nDLf

Cedarlake Acquisition, a China SPAC formed by Cedarlake Capital, filed for a $200 million IPO. http://axios.link/JEo6

Goldenstone Acquisition, a SPAC led by Eddie Ni (Windfall Group), filed for a $50 million IPO. http://axios.link/8BOM

Liquidity Events

SK Capital agreed to sell Niacet, a Dutch preservatives maker, to Kerry Group (Dublin: KRZ) for €853 million. http://axios.link/hm4Q

More M&A

Amazon (Nasdaq: AMZN) acquired the option to buy up to a 20% stake in self-driving truck startup Plus, as part of a fleet purchase agreement. http://axios.link/5JKt

Axa (Paris: CS) agreed to sell its Malaysian assets to Italy’s Assicurazioni Generali. http://axios.link/wKjm

The Smith and Hemingway families are seeking a buyer for their majority stake in Seattle-based Carrix, the largest U.S. marine terminal operator, which could fetch more than $2.5 billion, per Bloomberg. http://axios.link/Ykwk

Fundraising

ABN Amro formed a €425 million fund to back VC and growth equity investments in northwestern European startups focused on environmental sustainability and social impact. http://axios.link/5PHL

Academy Investor Network, a VC firm focused on veteran founders, is raising $50 million for its debut fund. http://axios.link/TNHV

It's Personnel

Jason Sutton joined One Rock Capital Partners as head of biz dev. www.onerockcapital.com

Final Numbers
Data: FactSet; Chart: Axios Visuals

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