Top of the Morning
Improbable Worlds, a London-based platform for third-party VR and simulated world game developers, has raised $502 million in Series B funding. SoftBank led the deal, and was joined by return backers Andreessen Horowitz and Horizons Ventures.
- Why it's the BFD: This appears to be the largest "venture capital" investment ever in a European startup (Improbable was founded in 2012), let alone in the software space. It's also yet another massive check from SoftBank, which did this deal off its balance sheet instead of via Vision Fund (although don't be shocked if this, and some other recent SoftBank investments, get rolled into Vision once it closes).
- Bottom line: "AI gets all the press, [but] this idea of recreating reality is going to become something in the public consciousness that's as important, as significant, as artificial intelligence." -- Improbable CEO Herman Narula to Wired
Venture Capital Deals
Private Equity Deals
• Gardner Denver, a Milwaukee-based maker of industrial machinery owned by KKR, raised $826 million in its IPO. The company priced 41.3 million shares at $20 per share (below $23-$26 range), for an initial market cap of nearly $3.8 billion. It will trade on the NYSE under ticker symbol GDI, while Goldman Sachs was listed as left lead underwriter. Gardner Denver reports a $31 million net loss on around $1.9 billion in revenue for 2016, compared to a $352 million net loss on $1.13 billion in 2015. http://bit.ly/2qciNuU
• Appian, a Reston, Va.-based provider of a software development platform, has set its IPO terms to 6.25 million shares being offered at between $11 and $13 per share. It would have a fully-diluted market value of around $878 million, were it to price in the middle of its range. The company plans to trade on the Nasdaq under ticker symbol APPN, with Morgan Stanley listed as left lead underwriter. Appian reports a $14 million net loss on around $133 million in revenue for 2016, compared to a $6.6 million net loss on $111 million in revenue for 2015. Shareholders include Novak Biddle Venture Partners (21.5% pre-IPO stake) and NEA (11.7%). www.appian.com
• Loton Corp., a Beverly Hills, Calif.-based provider of online networks focused on the live and digital music space, has filed for a $100 million IPO. It plans to trade under ticker symbol LIVX, with BMO Capital Markets serving as sole underwriter. The company reports a $9 million net loss on $225 million in revenue for the last nine months of 2016. www.livexlive.com
• Smart Global Holdings, a Newark, Calif.-based maker of specialty memory solutions to the electronics industry, has set its IPO terms to 5.3 million shares being offered at between $13 and $15 per share. It would have a fully-diluted market cap of around $302 million, were it to price in the middle of its range. The Silver Lake-owned company plans to trade on the Nasdaq under ticker symbol SGH, with Barclays and Deutsche Bank serving as lead underwriters. http://bit.ly/2q9W8Rb
• Cisco Systems (Nasdaq: CSCO) has agreed to acquire MindMeld, a San Francisco-based developer of "AI to power conversational interfaces," for $125 million. MindMeld previously raised around $17 million from firms like IDG Ventures, United Services Auto Association, Samsung Ventures, Intel Capital, Telefonica Digital, Liberty Global Ventures, Fenox Ventures, Westcott, TenOneTen Ventures and Quest Venture Partners. http://tcrn.ch/2pDjA5P
• Itaú Unibanco of Brazil is in talks to acquire a 49% stake in XP Investimentos, a Brazilian investment broker owned by General Atlantic, for around $1.9 billion, according to the WSJ. http://on.wsj.com/2qcCXEV
• Calpine Corp. (NYSE: CPN), a Houston-based power generation company valued north of $4 billion, has hired Lazard to explore a possible sale, according to the WSJ. http://on.wsj.com/2qTSMmy