The sun is shining, HSBC has new troubles and we’re just one day away from our sold-out Boston Liquidity Event. In other words, it’s time for some Monday Mouth-Off.
Most of the mailbag relates to my note last week about how some limited partners said they might have second thoughts about investing in gender-diverse partnerships, due to perceived litigation risk. Many emails were anonymous. Here we go:
Female LP: “I’m sure you’re receiving a million rants about the post on gender today. I can’t help but add my voice to the din. I’m horrified and shocked that any LPs (male or otherwise) would say that mixed gender firms create a risk. That is just a stupid thing to say. All male GPs have to interact with some females in the normal course of business even if none are in the partnership ranks. If the GP can’t be trusted to be in the same room with a female without harassing them, I would have very serious reservations about the GP’s general judgment. Also, it is paranoid and a little crazy to think that women are going to start running around suing firms. It is a huge career risk to sue a firm, and I think very few women would do it even if they had good reason. If you’re worried about litigation risk, look at the history of the people in the firm with litigation, not their gender. I can’t believe how comfortable people are displaying gender bias. I can’t imagine very many people would say similar things about race or other protected classes (although maybe we just haven’t had that conversation yet – VC partnership ranks do look a lot like Augusta National pre-1990).”
VC Dan: “Women are a risk in partnerships? Wow — I hope that wasn’t one of my LPs.”
Anon: “The item you highlighted yesterday illustrates the catch 22 facing women in tech and finance: No one should tolerate harassment or mistreatment in the workplace, but raising harassment or gender discrimination issues raises awareness of the ‘risks’ that can accompany a more gender diverse workplace. Thought exercise: You have a founding team consisting of a three 25-35 year-old men and are filling an open position. An attractive female and an equally qualified male apply. Who is going to carry more headline risk to the firm? If women are seen as tech culture whistleblowers it will further handicap the move towards inclusivity for women in tech. There are no easy solutions, but I am not sure these headlines are doing much to further our cause.”
Anne: “My first reaction to those LP comments was shock, but I really shouldn’t have been surprised. VCs are all about being able to raise new funds so, if they thought having women partners would help get more LPs, then they’d have women partners. But VCs obviously know these LP biases and have formed their partnerships accordingly.”
Craig: “You should name and shame these LPs.” Sorry Craig, but the conversations took place ‘on background,’ and I take that very seriously. No matter how much I may disagree with the content of said conversations.
Sarah: “One comment on your Ellen Pao observations. While it’s true that KPCB had more women on staff (and certainly more women in investing roles) than other ‘VC firms, the women who were ‘partners’ there (Ellen Pao, et al) were considered junior partners internally, and they received NO carried interest. KP was happy to market its diversity but wasn’t willing to reflect that in the economics.” Yes and no Sarah. KPCB is more liberal with its ‘partner’ title than are some other firms — and many of its female investment staff were junior. But, that said, KPCB does have two full-fledged female GPs (Beth Seidenberg and Mary Meeker), which is two more than most VC firms. This does not validate or invalidate Pao’s claims, but it’s worth noting for the record.
• John on the Austin Ventures troubles: “I have lived in Austin for more than 15 years and have seen a number of local investment firms disappear. AV is certainly the biggest, but it hasn’t been too important here for startups in a while. The only people here who are lamenting AV’s failure are those of us old enough to remember when AV really mattered. For a 25 year-old founders, it’s probably not even a topic of conversation.” For more on this point of view, check out this post from Joshua Baer.
THE BIG DEAL
• Asahi Kasei Corp. (Tokyo: 3407) has agreed to acquire Polypore International Inc. (NYSE: PPO) for approximately $3.2 billion in cash, or $60.50 per share. Polypore is a Charlotte, N.C.-based filtration company specializing in microporous membranes.
Just prior to the deal closing, 3M Co. (NYSE: MMM) would acquire Polypore’s Polypore’s Separations Media business for approximately $1 billion, with Asahi receiving the sale’s cash proceeds. www.polypore.com
VENTURE CAPITAL DEALS
• DriverUp, a Dallas-based online marketplace for automotive financing, has raised $50 million in Series A funding co-led by Emerald Development Managers and RRE Ventures. www.driverup.com
• Lifecode Inc., a Foster City, Calif.-based provider of gene sequencing-based molecular diagnostics, has raised $20.5 million in Series A funding from Sequoia Capital, The Mayo Clinic and Mayo Ventures.
NoBroker, a P2P property listing startup in India, has raised $3 million in Series A funding from SAIF Partners and Fulcrum Ventures. Read more.
• Konekt, a Chicago-based developer of a toolkit for IoT device management and network connectivity, has raised $1.3 million in seed funding. Backers include NextView Ventures, Mucker Capital,Tyler Willis Syndicate and, Rajen Ruparell. www.konekt.io
• ContaAzul, a provider of SaaS accounting and invoicing solutions to SMBs in Brazil, has raised an undisclosed amount of Series C funding. Ribbit Capital led the round, and was joined by Tiger Global Management and return backers 500 Startups, Monashees Capital and Valar Ventures. www.contaazul.com
• Correction: Instructure, a SaaS-based learning management company that raised $40 million in Series E funding, is based in Salt Lake City. Friday’s issue mistakenly said it was based in Kansas City.
PRIVATE EQUITY DEALS
• The Abraaj Group has acquired a minority equity stake in Hepsiburada.com, a Turkish online retailer. No financial terms were disclosed. www.hepsiburada.com
• Abracon, an Irvine, Calif.-based manufacturer of passive electronic components, has raised an undisclosed amount of private equity funding from Evergreen Pacific Partners. www.abracon.com
• Aye Finance, an Indian commercial lender for SMEs, has raised an undisclosed amount of private equity funding from SAIF Partners and Accion. www.ayefin.com
• Bruckmann, Rosser, Sherrill & Co. has acquired Simpson Performance Products Inc., a New Braunfels, Texas-based provider of motorsports safety equipment, from Carousel Capital. No financial terms were disclosed. www.simpsonraceproducts.com
• Epic Health Services Inc., a Dallas-based portfolio company of Webster Capital, has acquired Loving Care Agency, a Hasbrouck Heights, N.J.-based provider of nursing services to “medically-complex and fragile children in their homes and schools,” from MTS Health Investors. No financial terms were disclosed. www.epichealthservices.com
• LDC has sponsored a management buyout of Synexus, a UK-based company that recruits for and runs clinical trials at its own research centers, from Lyceum Capital. No financial terms were disclosed, except that Synexus generated $12 million in EBITDA on $63 million in revenue during 2014. www.synexus.com
• PeopleAdmin, a Vista Equity Partners portfolio company, has acquired Netchemia LLC, a Prairie Village, Kansas-based provider of K-12 talent management software, from Mainsail Partners. No financial terms were disclosed. www.netchemia.com
• Shore Capital Partners has acquired Summit Medical Inc., a St. Paul, Minn.-based maker of medical devices, including a line for infection control and sterilization in the critical care market. No financial terms were disclosed. www.shorecp.com
• Thoma Bravo has acquired PowerPlan Inc., an Atlanta-based provider of accounting, tax and capital budgeting optimization solutions, from JMI Equity and TPG Growth. No financial terms were disclosed. www.powerplan.com
• Cellectis SA, a French gene-editing company, has filed for a $115 million IPO. It plans to trade on the Nasdaq under ticker symbol CLLS, with BofA Merrill Lynch, Jefferies and Piper Jaffray serving as lead underwriters. The company reports nearly an $11 million net loss on around $14 million in revenue for the first six months of 2014. Shareholders include Bpifrance Participations (10.36% pre-IPO stake) and Pfizer Inc. (9.47%). Cellectis already is listed on the Alternext market of Euronext in Paris under ticker symbol ALCLS. www.cellectis.com
• One Equity Partners has sold the Duropack Group, an Austrian paper and corrugated board manufacturer, to DS Smith (LSE: SMDS) for approximately €300 million. www.dssmith.com
• Sosei Group Corp. (Tokyo: 4565) has acquired Heptares Therapeutics Ltd., a UK-based developer of medicines targeting G protein-coupled receptors. The deal is valued at upwards of $400 million, including $180 million in cash up-front and $220 million in milestone-based earn-outs. Heptares had raised over $50 million in VC funding from Clarus Ventures, Takeda Ventures, MVM Life Sciences, Novartis Ventures and The Stanley Family Foundation. www.heptares.com
• 21st Century Fox (Nasdaq: FOX) denied an Australian Financial Review report that it held “nascent” takeover talks with Discovery Communications Inc. (Nasdaq: DISC), which has a market cap of around $20 billion. Read more.
• Springleaf (NYSE: LEAF) has agreed to acquire OneMain Financial, the sub-prime lending unit of Citigroup Inc., for more than $4 billion, according to the WSJ. Lone Star Funds also is reported to have made an offer. Read more.
• TransDigm Group (NYSE: TDG) has agreed to acquire Telair Cargo Group from AAR Corp. (NYSE: AIR) for approximately $725 million in cash. Telair is a global provider of aerospace on-board cargo loading and handling, restraint systems and unit load devices. www.transdigm.com
• Valeant Pharmaceuticals (TSX: VRX) has agreed to acquire Raleigh, N.C.-based drugmaker Salix Pharmaceuticals (Nasdaq: SLXP) for $14.4 billion (including $4b of assumed debt), or $158 per share. Read more.
FIRMS & FUNDS
• The Blackstone Group has closed its second energy-focused private equity fund with $4.5 billion in capital commitments. Read more.
• First Reserve, a Connecticut-based private equity firm focused on the energy sector, is closing its Hong Kong office, according to Dow Jones. www.firstreserve.com
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