Dec 18, 2019

Axios Pro Rata

By Dan Primack
Dan Primack
Top of the Morning

CEOs often depart without much explanation, outside of pablum about wanting to spend more time with their families or pursue new challenges.

  • At Boeing, whose 737 Max planes killed 346 people via a pair of crashes, the situation is reversed: CEO Dennis Muilenburg still has his job, despite a ruinous year that would have toppled most other CEOs.
  • No one seems to know why.

This comes in the context of a year in which there has been the highest rate of CEO turnover since staffing firm Challenger, Gray & Christmas began tracking the data in 2002.

  • Muilenburg has led Boeing since 2015, and had been heralded for record profits and a tripling of the company's stock price.
  • But then came the disasters, which laid bare a culture at Boeing in which safety concerns were discounted — and federal regulators were treated as little more than malleable rubber stamps.
  • Muilenburg has proven unable to get Boeing's 737 Max fleet back in operation, and this week the company announced an indefinite production stoppage that was at one point unthinkable.
  • Boeing's profits have sagged, even turning a loss in Q2. Shareholders have lost more than $65 billion since March.

Muilenburg was stripped of his chairman title in October and recently vowed to forgo any 2019 bonuses, but he continues to lead the company and earn millions in base salary.

  • No member of Boeing's board, which includes Nikki Haley and Caroline Kennedy, has publicly opposed Muilenburg.
  • No activist investor has threatened to wage a proxy fight over management.
  • No one seems able to give a rationale for why Muilenburg remains CEO — including nearly a dozen Boeing analysts contacted by Axios. One theory is that they simply don't think they can find someone better, but, again, it's just a theory.

The bottom line: Hundreds are dead. Families are devastated. Safety seemed secondary. Billions of dollars have been lost. Projected timelines have been scrapped, and optimism was misplaced. Suppliers now face their own uncertainties, threatening livelihoods beyond Boeing.

Many, many other CEOs have been fired for much, much less — particularly in 2019. Muilenburg's survival is the year's great corporate mystery.

The BFD

Illustration: Sarah Grillo/Axios

JAB Holding plans to merge Dutch coffee giant Jacobs Douwe Egberts with California-based Peet's Coffee, and then IPO the combined company in 2020.

  • Why it's the BFD: This could create the world's largest publicly-traded coffee roaster. Well, at least in terms of a dedicated company, as its sales remain behind market leader Nestlé.
  • Details: The IPO could raise upwards of €3 billion in Amsterdam or elsewhere in Europe, per the FT.
  • Bottom line: "Although coffee bean prices paid to farmers remain depressed because of oversupply, business is booming for companies that roast and package coffee." — Leila Abboud & Arash Massoudi, FT
Venture Capital Deals

🚑 ArcherDX, a Boulder, Colo.-based personalized genomic medicine startup, raised $55 million in Series C funding. Perceptive Advisors led, and was joined by Redmile Group, Soleus Capital, Driehaus Capital Management, ArrowMark Partners and return backers Sands Capital, Longwood Fund, PBM Capital, and Boulder Ventures. http://axios.link/vEMr

Domio, a New York-based renter of apartment-like hotel rooms, raised $50 million in Series B funding. GGV Capital led, and was joined by Eldridge Industries, 3L Capital, Tribeca Venture Partners, SoftBank NY, Tenaya Capital and Upper90 (which also led a $50m debt tranche). http://axios.link/u7iQ

OM1, a Boston-based startup focused on predicting medical patient outcomes, raised $50 million in Series C funding. Scale Venture Partners led, and was joined by return backers General Catalyst, Polaris Partners, and 7wire Ventures. http://axios.link/YGgX

🚑 Paige, a New York-based computational pathology startup focused on cancer, raised $45 million in Series B funding from such backers as Healthcare Venture Partners and Breyer Capital. www.paige.ai

Vndly, a Cincinnati-based management platform for gig economy workforces, raised $35 million in Series B funding. Insight Partners led, and was joined by Battery Ventures, Hyde Park Venture Partners, EPIC Ventures, Bowery Capital, and Cintrifuse. http://axios.link/xOfB

🚑 ChromaCode, a Carlsbad, Calif.-based molecular diagnostics company, raised $28 million in Series C funding. Northpond Ventures led, and was joined by Windham Ventures, Moore Venture Partners, CalTech, and return backers NEA, Domain Associates, and Okapi Ventures. http://axios.link/FuKu

PlayOn Sports, an Atlanta-based high school sports media company, raised $25 million. BIP Capital led, and was joined by Jeff Vinik, Teall Capital, and Crossover. http://axios.link/QGIv

🚑 TMRW Life Sciences, a New York-based embryology and cryo-management startup, raised $25 million in Series B funding led by 5AM Ventures. http://axios.link/tAnp

🚑 Velano Vascular, a San Francisco-based developer of vascular access technology products, raised $25 million in new funding from undisclosed investors. http://axios.link/dPMp

Gloat, an Israeli internal talent marketplace, raised $25 million. Eight Roads Ventures and Intel Capital co-led, and were joined by return backers Magma Venture Partners and PICO Partners. http://axios.link/r9SG

LogicGate, a Chicago-based process automation startup for enterprise GRC, raised $25 million in equity and debt funding. Jump Capital and High Alpha Capital co-led, and were joined by Greenspring Associates and SVB. http://axios.link/GJbV

Anyscale, an open-source platform for helping developers build distributed apps, raised $20.6 million in Series A funding. Andreessen Horowitz led, and was joined by NEA, Intel Capital, Ant Financial, Amplify Partners, 11.2 Capital, and The House Fund. http://axios.link/rWBT

🚑 Cellestia Biotech, a Swiss cancer biotech focused on gene transcription, raised around $20 million in Series B funding from PPF Group and Partners Investment. www.cellestia.com

Rensource Energy, a Nigerian provider of solar power solutions for commercial community structures, raised $20 million in Series A funding co-led by CRE VC and the Omidyar Network. http://axios.link/p5ux

Bushel, a Fargo, N.D.-based provider of software for the grain industry, raised $19.5 million in Series B funding. Continental Grain Co. led, and was joined by Lewis & Clark AgriFood and Germin8 Ventures. www.bushelpowered.com

Huckleberry, a San Francisco-based online insurance purchasing and management platform for small businesses, raised $18 million in Series A funding. Tribe Capital led, and was joined by seed backers Amaranthine, Crosslink Capital and Uncork Capital. www.huckleberry.com

BC Platforms, a Swiss genomic data management and analytics startup, raised $15 million. IQVIA led, and was joined by Debiopharm Innovation Fund and Tesi. http://axios.link/AZto

Hugging Face, a New York-based natural language processing library and chatbot developer, raised $15 million. Lux Capital led, and was joined by A.Capital and Betaworks. http://axios.link/7xrp

Shenandoah Valley Organic, a Harrisonburg, Va.-based organic meat brand, raised $15 million. Open Prairie led, and was joined by S2G Ventures and Middleland Capital. www.farmerfocus.com

Springboard, a San Francisco-based online training platform for technical skills, raised $11 million. Reach Capital led, and was joined by Pearson Ventures, IFC, Costanoa Ventures, Learn Capital, and Blue Fog Capital. http://axios.link/ugM2

Teraki, a Berlin-based processing platform for tightly-constrained electronic components in auto systems, raised $11 million in Series A funding. Horizons Ventures led, and was joined by State Auto Labs Fund, Paladin Capital Group, and Innogy Ventures. www.teraki.com

Voximplant, a Palo Alto-based cloud communications platform, raised $10 million in Series B funding. Baring Vostok led and was joined by RTP Ventures. www.voximplant.com

Pronto, a Salt Lake City-based engagement platform, raised $7.5 million in Series B funding/ Origin Ventures led and was joined by Signal Peak Ventures. www.pronto.io

Trainual, a Scottsdale, Ariz.-based business knowledge transfer startup, raised nearly $7 million in Series A funding co-led by 4490 Ventures and Math Venture Partners. http://axios.link/xkTK

Trust & Will, a San Diego-based estate planning platform, raised $6 million from Link Ventures, Rise of the Rest, Western Technology Investment, Techstars Ventures, Luma Launch, and Halogen Ventures. http://axios.link/CfL2

Pepper, a Los Angeles-based provider of spend analytics for startups, raised $5.6 million in seed funding from Upfront Ventures, Lerer Hippeau, and Manta Ray Ventures. http://axios.link/iia7

Oto, a voice recognition software startup focused on intonation, raised $5.3 million in seed funding from Firstminute Capital, Interlace Ventures, SAP, and SRI International. http://axios.link/quvo

Satori Cyber, an Israeli data protection and governance startup, raised $5.25 million in seed funding led by YL Ventures. http://axios.link/Cy8P

🚑 Emilio Health, a Palo Alto-based behavioral health facility for children and their families, raised $5 million in seed funding from Oak HC/FT. www.emiliohealth.com

Ryff, a Los Angeles-based product placement startup for previously-produced content, raised $5 million. Valor Siren Ventures led, and was joined by MaC Venture Capital, Moneta Ventures, and Vulcan Capital. http://axios.link/5XUT

Rebank, a London-based banking task automation platform for business accounts, raised $2.8 million in seed funding. ADV led, and was joined by Oriza Ventures and YC. http://axios.link/vRXt

🚑 TrialJectory, a New York-based patient-matching platform for clinical trials, raised $2.7 million in seed funding led by Contour Venture Partners.

Private Equity Deals

🚑 1-800 Contacts, an Orem, Utah-based portfolio company of AEA Investors, acquired 6over6 Vision, an Israeli in-home eye exam startup that had raised around $15 million from firms like Lenskart, Rimonci Capital, and Alumot. http://axios.link/jpAa

Advent International bought Brazilian auto parts retailer Rondobras. http://axios.link/tYUS

American Express (NYSE: AXP) sold a 50% stake in its global business travel business to an investor group led by Centares. Other buyers include Carlyle Group, BlackRock, Quatar Investment Authority, GIC, and Texas TRS. http://axios.link/qSOG

Attention Capital acquired Girlboss, a millennial women-focused media company that had raised $3 million from Lightspeed Venture Partners. http://axios.link/oWGj

Carbon60, a Canadian portfolio company of M/C Partners, acquired Cirrus9, a Canadian managed cloud and hosting solutions provider. www.carbon60.com

Crestview Partners invested$150 million for a minority stake in talent agency ICM Partners. http://axios.link/K4mw

Francisco Partners and Elliott Management agreed to buy Boston-based workplace software company LogMeIn (Nasdaq: LOGM) for $4.3 billion in cash, or $86.05 per share (25% premium to price before reports of a possible deal). http://axios.link/3MNh

NewLook Capital invested in InSite, a Hoover, Ala.-based designer, builder, and operator of wastewater treatment facilities. www.insiteengineering.com

Providence Equity Partners paid €200 million for a majority stake in Helsinki-based social video ad-tech company Smartly.io. Existing backers Highland Europe and Lifeline Ventures retain stakes. http://axios.link/WQ6w

WaterBridge Holdings, a water midstream platform, secured $345 million in new equity capital to acquire produced water infrastructure in the Southern Delaware. Investors include Five Point Energy, GIC and Magnetar Capital.

Public Offerings

Aztech Group, a Singapore-based conglomerate, is considering a local listing for its tech unit, which could raise nearly US$300 million, per Bloomberg. http://axios.link/0Awn

Beike Zhaofang, a Chinese online property brokerage platform, is considering a 2020 IPO that could raise at least $1 billion, per Bloomberg. The company has raised over $3 billion from firms like SoftBank and Tencent. http://axios.link/a5hc

Liquidity Events

EQT Infrastructure sold Contanda, a Houston-based provider of liquid bulk storage solutions, to “institutional investors advised by J.P. Morgan Asset Management.” www.contanda.com

More M&A

Arko Holdings (TA: ARKO) of Israel acquired the U.S. fuel distribution unit of Dallas-based Empire Petroleum Partners for $400 million. http://axios.link/BKEg

Bertelsmann bought the 25% stake it didn’t already own in publisher Penguin Random House for $675 million from Pearson (LSE: PSON). http://axios.link/wm6j

Fiat Chrysler and Peugeot maker PSA formalized their planned $50 billion merger, via a binding agreement. http://axios.link/4hB0

Hitachi (Tokyo: 6501) agreed to sell its 51% stake in Hitachi Chemical (T: 4217) for $6.2 billion to Showa Denko (T: 4004). http://axios.link/M5nN

Jeju Air, a South Korean budget airline, agreed to buy a 51% stake in rival Eastar Jet for around $59 million. http://axios.link/KBEi

Mark Cuban agreed to sell Synergy Sports Technology, an Anacortes, Calif.-based provider of pro basketball and baseball analytics, to a group of LA Dodgers owners. http://axios.link/TmzP

New York Life agreed to buy Cigna’s (NYSE: CI) non-health insurance units for $6.3 billion in cash. http://axios.link/SWjc

Valence Media, a Los Angeles-based media holding company backed by Eldridge Industries, acquired Nielsen Music. http://axios.link/yyMB

Volvo (Oslo: VOLV) agreed to sell its Japan-based UD Trucks unit to Isuzu Motors (Tokyo: 7202) for $2.3 billion. http://axios.link/6C7q

Fundraising

Moxxie Ventures, a new firm founded by Katie Jacobs Stanton (ex-Twitter, co-founders of #Angels), raised $25 million for its debut fund. http://axios.link/qOQE

Sapphire Ventures raised round $1 billion for its fourth flagship fund and $150 million for a new opportunities fund. www.sapphireventures.com

It's Personnel

Michael Apfel joined Siguler Guff as a managing director and head of credit. He previously co-founded MidOcean Credit Partners. www.sigularguff.com

Blythe Masters, the former JPMorgan exec who last year stepped down as CEO of Digital Asset Holdings, joined Motive Partners as an industry partner. http://axios.link/jgHz

Matt Wichrowski is leaving Entrepreneur First, where he leads its “launch program,” to join Berlin-based Fly Ventures, per TechCrunch. http://axios.link/eO18

Final Numbers
Source: Dallas Fed, based on data from Haynes & Boone LLP. 2019 2H data only through September.
Dan Primack

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