Nov 4, 2019

Axios Pro Rata

Top of the Morning

Illustration: Rebecca Zisser/Axios

Female founders continue to hold much less equity in their companies than do male peers, according to a Carta analysis of nearly 10,000 startups.

  • Women represent 13% of startup founders, but hold just 7% of the equity value. They also make up 34% of startup employees, but hold just 20% of startup employee equity wealth.
  • These numbers are mostly unchanged from a similar report last year, which used a smaller sample of companies.

Why the gender equity gap? The most obvious explanation is discrimination, whether conscious or not. Also:

  • Most of Silicon Valley's most valuable "unicorns" were founded by men, so there's a bunch of power law dynamic at work.
  • Founding team members aren't necessarily treated equally when it comes to equity grants.
  • The inertia of VC pattern-matching.
  • Within startup C-suites, women are most represented among chief marketing officers (32%), but it's the role with the lowest median equity.
  • Early-stage startups tend to have lower percentages of women employees than do later-stage startups, but it's at the earlier stages where the most equity wealth is amassed (in terms of both number of shares and share price).
  • Axios' Kia Kokalitcheva reports that other possible explanations include female founders selling bigger stakes to investors than do their male peers, and also creating bigger employee options pools.

The bottom line is that, when it comes to gender equality, the country's most progressive and disruptive companies too often are regressive and clinging to the status quo.

🏀 Rebound: Silver Lake has interest in acquiring major stakes in the New York Knicks and New York Rangers, according to the NY Post.

  • It would be the most ambitious private equity turnaround effort since Cerberus tried (and failed) with Chrysler.
  • It's not unprecedented for private equity funds to own pro sports teams. The Detroit Pistons, for example, are technically owned by Platinum Equity funds, not by Tom Gores himself.

Silver Lake is already the largest non-Dolan owner of the teams' parent company MSG, with nearly an 8% stake. The reported plan would see it substantially raise its interests in the two teams — but not in other MSG assets — ahead of an expected spin-off.

Also in sports deal news:

  • Penske Entertainment this morning agreed to buy the Indianapolis Motor Speedway and IndyCar Series from longtime owner Hulman & Co.
  • The Chernin Group reportedly is in talks to sell sports media company Barstool Sports to a gambling operator.

Illustration: Sarah Grillo/Axios

Saudi Arabia yesterday approved IPO plans for state-owned oil company Aramco, with a prospectus to be released on November 9.

  • Why it's the BFD: Saudi Aramco is expected to be the largest IPO of all-time, even though valuation expectations are being tempered from the $2 trillion first floated by Saudi Crown Prince Mohammed bin Salman.
  • Bottom line: This finally seems to be happening, after more stops-and-starts than a teenager learning to drive stick.
Venture Capital Deals

Deserve, a Menlo Park-based “credit-as-a-service” platform, raised $50 million. Goldman Sachs led, and was joined by return backers Sallie Mae, Accel, Aspect Ventures, Pelion Venture Partners and Mission Holdings.

Centrical, an Israeli-based employee engagement and performance management platform, raised $13 million. Aleph led, and was joined by return backer JVP.

Cervest, a London-based climate forecasting platform, raised 3.7 million in seed funding. Future Positive Capital led, and was joined by Astanor Ventures.

BuildOps, a Los Angeles-based provider of management software for commercial real estate contractors, raised $5.8 million in seed funding led by Fika Ventures.

Private Equity Deals

Centerbridge Partners and Gallatin Point Capital completed their $446 million purchase of a 32.5% stake in Israeli insurer Phoenix Holdings from Delek Group.

Harvest Partners bought Yellowstone Landscape, a Bunnell, Fla.-based provider of commercial landscaping services, from CIVC Partners.

🍗 ICV Partners invested in JK&T Wings, a Michigan-based franchisee of Buffalo Wild Wings restaurants.

Stellium, a UK-based data-center operator, raised £30 million led by Tiger Infrastructure.

U.S. Nonwovens, a Brentwood, N.Y.-based portfolio company of Wind Point Partners, acquired the PVA packaging unit of Multi-Pack, a Mt. Prospect, Ill.-based portfolio company of Cameron Holdings.

Yellow Wood Partners completed its $585 million purchase of foot-care products brand Dr. Scholl’s from Bayer.

Public Offerings

Nine companies expect to price IPOs this week on U.S. exchanges, including the largest-ever offering from a Canadian issuer (GFL Environmental).

Fangdd Network Group, a Chinese online real estate trading platform, raised $78 million in its IPO. The company priced 6 million shares at $13, versus plans to offer 7 million shares at $13-$15, for a market cap of $1.1 billion. It closed its first day of trading flat (Nasdaq: DUO). Fangdd had raised over $300 million in VC funding from firms like Sky9 Capital, FountainVest Partners, CyberAgent Ventures, CPPIB, Vision Knight Capital Partners, Lightspeed China Partners, and CDH China.

More M&A

• Axereal, a French grain co-op, became the world’s largest malt producer, by closing its previously-announced purchase of Cargill’s malt business.

EDF (Paris: EDF) agreed to buy Pivot Power, a UK-based provider of EV charging infrastructure.

Huazhu Group (Nasdaq: HTHT), a Chinese hotel operator, agreed to buy German hotelier Deutsche Hospitality for €700 million.

Independence Group (ASX: IGO) launched a A$312 million hostile takeover bid for rival Australian nickel miner Panoramic Resources (ASX: PAN).

Morningstar (Nasdaq: MORN) agreed to buy AdviserLogic, an Australian provider of financial advisor software.

Santander invested £350 million for a 50.1% stake in Ebury, a London-based provider of foreign exchange, money transfer and other currency services to SMEs.

🚑 Stryker (NYSE: SYK) agreed to buy rival medical device maker Wright Medical Group (Nasdaq: WMGI) for $4 billion in cash, or $30.75 per share (39.7% premium over Friday’s closing price).


Altas Partners closed its second fund with $3 billion in capital commitments.

It's Personnel

Bob Brown joined New York-based private equity firm Motive Partners as a founding partner. He previously founded and led BearTooth Advisors (acquired by Houlihan Lokey) and, before that, led fundraising for both Advent International and The Carlyle Group.

Jake Cabela joined Golden Gate Capital as head of capital formation, per his LinkedIn page. He previously was a managing director with crowdsourcing platform CircleUp.

Gonzalo Erroz joined Hayfin Capital Management as co-head of private equity funds, per PE International. He previously was with GIC.

Michal Katz joined Mizuho Americas as head of corporate and investment banking, per her LinkedIn page. She previously co-led tech investment banking for RBC Capital Markets.

Ian Mackay joined BlackArch Partners as a managing director and head of financial sponsors, per his LinkedIn page. He previously spent 12 years with Raymond James.

Cack Wilhelm, who recently stepped down as a San Francisco-based partner with VC firm Accomplice, has joined IVP, Axios has learned.

Final Numbers
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Adapted from Carta; Chart: Andrew Witherspoon/Axios

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