In late 2013, we reported that Tim Draper was stepping back from the Silicon Valley venture firm he had co-founded 28 years earlier, in that he would not be a general partner on DFJ's next fund (which was raised the subsequent year). But Tim took some issue with our reporting, telling other media outlets that he was "not leaving DFJ. Ever. I am just skipping a fund to do some work building Draper University and experimenting with new models for venture capital."
But when DFJ yesterday announced that it had raised yet another new VC fund ― this time with $350 million ― Tim Draper again wasn't a general partner (although he continues to be one of the firm's largest LPs). So much for only skipping one fund...
This is not to say, however, that Tim Draper is leaving institutional investing behind. Multiple sources say that he is raising between $150 million and $180 million for a new fund that he will co-manage with son Billy Draper. It will likely be done under the Draper Associates brand (DA has historically been a family office), with Tim committing $50 million of the total.
• Speaking of new VC funds: Goodwater Capital, a venture firm focused on consumer tech startups, is targeting $200 million for its second fund, per sources. This is the firm launched in early 2014 by Chi-Hua Chien(ex-Kleiner Perkins) and Eric Kim (ex-Maverick Capital), which raised $130 million for its debut vehicle.
• LBO-uh-oh: The Carlyle Group this morning reported economic net income of 24 cents per share, well below Wall Street estimates and 59% lower than the year-earlier period. The firm also announced its first-ever stock buyback, and was the subject of a Bloomberg story yesterday saying that it had raised $3 billion for a new fund that will have around twice the holding period of a typical PE fund.
During a call with analysts, Carlyle executives acknowledged the difficult credit markets. This was particularly true when asked about energy deals, where the firm believes that while the bid/ask price gap is shrinking ("people who need money are more desperate"), the ability to get deals financed is particularly uncertain.
Also interesting to hear David Rubenstein say that he has not yet seen a private equity pullback from sovereign wealth funds in oil-producing Middle Eastern countries. He also sees Asia-based sovereigns becoming a much more meaningful piece of the fundraising pie.
THE BIG DEAL
• US Foods, an Illinois-based foodservice giant, has filed for a $100 million IPO. It plans to trade on the NYSE under ticker symbol USFD. No underwriting banks were identified.
US Foods had been owned by Dutch retailer Royal Ahold until 2007, when it was acquired by KKR and Clayton Dubilier & Rice for $7.1 billion in cash. The company had agreed in 2013 to be acquired by Sysco (NYSE: SYY) for $3.5 billion, but the deal was later terminated due to U.S. regulatory objections. Read more.
VENTURE CAPITAL DEALS
• ARMO BioSciences Inc., a Redwood City, Calif.-based, has raised $50 million in Series C funding. HBM Healthcare Investments, Google Ventures, Celgene Corp., Clough Capital Partners and Industrial Investors Group were joined by return backers Kleiner Perkins Caufield & Byers, OrbiMed Advisors, DAG Ventures and NanoDimension. www.armobio.com
• Yumanity Therapeutics, a Cambridge, Mass.-based drug discovery startup focused on diseases caused by protein misfolding, has raised $45 million in Series A funding. Fidelity led the round, and was joined by Redmile Group, Alexandria Venture Investments, Biogen, Sanofi-Genzyme BioVentures and Dolby Family Ventures. www.yumanity.com
• Sunverge Energy, a San Francisco-based provider of energy storage and distributed energy resource management solutions, has raised $36.5 million in Series C funding. AGL Energy Ltd. (ASX: AGL) led the round, and was joined by return backers Australian Renewable Energy Agency (ARENA), SBCVC, Siemens Venture Capital and Total Energy Ventures International.
• Latch, a Washington, D.C.-based maker of a keyless, connected entry security system, has raised $10.5 million in Series A funding led by Lux Capital.
• Halo Neuroscience, a San Francisco-based developer of neuroscience-based technology for enhancing brain performance, has raised $9 million in Series A funding. Lux Capital led the round, and was joined by Andreessen Horowitz, Jazz Venture Partners, SoftTech Ventures and Xfund. www.haloneuro.com
• Hexadite, a Boston-based provider of security orchestration and automation solutions, has raised $8 million in Series A funding from Hewlett Packard Ventures, Ten Eleven Ventures and seed backer YL Ventures. www.hexadite.com
• SchoolMint, a San Francisco-based provider of SaaS solutions for enrolling in preschools through high schools, has raised $5.6 million in new VC funding. Runa Capital led the round, and was joined by Maiden Lane Ventures, CSC Upshot, Crosslink Capital, Reach Newschools Capital, Fresco Capital, the Govtech Fund and Kapor Capital. www.schoolmint.com
• ZyBooks, a San Francisco-based provider of interactive learning products for the higher education STEM market, has raised $4 million in VC funding led by Bialla Venture Partners. www.zybooks.com
• First Stop Health, a Chicago-based provider of telemedicine and advocacy services, has raised $2.1 million in new seed funding from unidentified individual and institutional investors. The company previously raised $3.5 million. www.fshealth.com
• NuuED Inc., an Oakland, Calif.-based maker of a mobile educational app designed to “determine a person’s learning personality,” has raised $3 million in new VC funding. DuKlaw Ventures led the round, and was joined by Deutsche Gruppe. www.nuued.com
• Statflo Inc., a Toronto-based wireless customer service startup, has raised C$2.4 million in seed funding. Round13 Capital led the round, and was joined by Extreme Venture Partners, MaRS IAF, Globalive Capital, Rising Tide Fund, Garage Capital, Hedgewood and TIO Networks. www.statflo.com
• Edyn, an Oakland, Calif.-based “smart garden system” has raised an undisclosed amount of new funding. Fenox Ventures led the round, and was joined by Ideabulb Ventures, Morningside Group, Indicator Ventures and individual angels. www.edyn.com
PRIVATE EQUITY DEALS
• A10 Capital, a Boise, Idaho-based middle-market commercial real estate lender, has secured a $75 million investment facility from KKR. www.a10capital.com
• Alex and Ani, a Cranston, R.I.-based jewelry maker, has agreed to acquire Cinerama for around $100 million in cash and stock, according to a Rhode Island media report. Cinerama is an “old-line manufacturing company that spawned Alex and Ani [that] has been the primary manufacturer since the company launched.” Alex and Ani shareholders include JH Partners and Lion Capital. Read more.
• Black Mountain Oil & Gas LLC, a Fort Worth, Texas-based oil and gas company, has secured a $150 million equity commitments from Natural Gas Partners. www.blackmtn.com
• GCR Inc., a New Orleans-based portfolio company of Clearview Capital, has acquired PCC Technologies LLC, a Windsor, Conn.-based provider of managing software for day-to-day functions of state and local government agencies. No financial terms were disclosed. www.gcrincorporated.com
• The Hilb Group, a Richmond, Va.-based portfolio company of ABRY Partners, has acquired Dowling & O’Neill, a Hyannis, Mass.-based provider of general property and casualty insurance with a particular focus on high-net-worth personal lines and healthcare. No financial terms were disclosed. www.hilbgroup.com
• One Equity Partners has acquired All Metro Health Care Services Inc., a Valley Stream, N.Y.-based provider of provider of home and community-based healthcare services, from Nautic Partners. No financial terms were disclosed. www.all-metro.com
• Opera Software, a listed Norwegian maker of the Opera web browser, has received a $1.2 billion takeover offer from a consortium of Chinese investors that includes Golden Brick Silk Road Fund Management and Qihoo 360 (NYSE: QIHU). Read more.
• OTG EXP Inc., a New York-based airport restaurant operator with 220 locations across 10 airports, has postponed an IPO that had been expected to price this week, citing unfavorable market conditions. The company had planned to offer 32.5 million shares at between $16 and $18 per share, and trade on the Nasdaq under ticker symbol OPG. Morgan Stanley and Credit Suisse are serving as lead underwriters. OTG EXP reports a $116 million net loss on $285 million in revenue for the 39 weeks ending on Sept. 27, 2015. www.anotgexperience.com
• Gen Cap America has sold OFM, a Holly Springs, N.C.-based maker and wholesaler of furniture for businesses, government, schools, hospitals and churches. No financial terms nor buyer were disclosed. www.ofminc.com
• Pocket Games (OTC BB: PKGM) has acquired Viximo, a Cambridge, Mass.-based social gaming platform, for $3.5 million in stock. Viximo had raised $5 million in 2009 from North Bridge Venture Partners and Sigma Partners. www.viximo.com
• Algonquin Power & Utilities Corp. (TSX: AQN) has agreed to acquire Joplin, Mo.-based Empire District Electric Co. (NYSE: EDE) for nearly US$2.4 billion. The $34 per share deal represents a 20.6% premium to where Empire District stock closed trading yesterday. Read more.
• Asahi Group Holdings Ltd. (Tokyo: 2502) reportedly has reached a preliminary agreement to acquire the Peroni and Grolsch brands, which are being sold by SABMiller ahead of its planned $108 billion takeover by Anheuser-Busch InBev NV. Rival bidders had included KKR. Read more.
• Halliburton (NYSE: HAL) is planning to sell more assets of Baker Hughes Inc. (NYSE: BHI), in order to secure regulatory approval of its takeover of the rival oilfield services company, according to Bloomberg. The latest businesses on the block would be Baker’s offshore drilling-and-completion fluids unit and most of its completion systems. Halliburton’s cash-and-stock acquisition was valued at $35 billion when it was announced in late 2014, but is now valued at around $18.5 billion. Read more.
• Hikma Pharmaceuticals PLC (LSE: HIK) has cut the cash piece of its takeover offer for the Roxane Labs, the U.S. generic drugs unit of Germany’s Boehringer Ingelheim, due to lower-than-expected sales. The cash would now be $647 million compared to $1.18 billion, plus 40 million new shares of Hikma stock. Read more.
• WorldRemit, a London-based mobile money transfer service, has raised $45 million in financing from TriplePoint Venture Growth and Silicon Valley Bank. The company reportedly was valued at around $500 million in its last VC round. www.worldremit.com
FIRMS & FUNDS
• Capricorn Healthcare & Special Opportunities, a private equity firm focused on the healthcare and wellness industry, has closed its second fund with $350 million in capital commitments. www.capricornhealthcare.com
• Karma Ventures, a new pan-European VC firm, has closed its debut fund with €40 million in capital commitments. Principals include Margus Uudam, and Kristjan Laanemaa, both of whom previously were with Ambient Sound Investments. Read more.
MOVING IN, ON & UP
• Paul Compton has agreed to join Barclays as chief operating officer, effective in May. He previously served as chief administrative officer at J.P. Morgan Chase. Read more.
• Rosy Ku has joined insurance brokerage Krauter & Co. as head of West Coast private equity. She previously was VP of risk management with The Gores Group. www.krautergroup.com
• Doug Pepper has joined Shasta Ventures as a managing director. He previously was a partner with InterWest Partners, where his deals included Marketo (Nasdaq: MKTO), Flurry (acquired by Yahoo) and Lombardi (acquired by IBM). His current InterWest portfolio includes Appboy, Badgevile, Newscred, INVIDI, Spredfast and Tapjoy. www.shastaventures.com
• Shawn Schestag has joined Sixpoint Partners as a managing director and head of secondary advisory and co-investment. He previously was with Credit Suisse, as a member of its private fund group’s secondary advisory practice. www.sixpointpartners.com
• Jason Star has joined online investment platform CircleUp as a partner and head of private equity funds. He previously was a principal with Winona Capital Management. www.circleup.com
• Ray Villareal has joined private equity firm Strattam Capital as a full-time operating partner. He previously was with LifeSize, a unit of Logitech (Swiss: LOGN), as VP of the Americas and GM of global services. www.strattam.com
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