Greetings from the home office, where it’s great to be back for a day before heading off to Cleveland to cover the Republican National Convention. Some quick notes as I reacclimate to sea level…
• Deal data: Venture capitalists deployed $15.3 billion into 961 deals during Q2 2016, which is off 12% and 22% (respectively) from the year-earlier period, according to the MoneyTree three of the NVCA, PwC and Thomson Reuters. As compared to Q1, the new figures are off 20% and 5%. In other words, the deal sizes are actually climbing as the number of deals shrinks.
Thomson Reuters also reports that global announced M&A is now at $1.7 trillion year-to-date, down 23% from this point in 2015. Global private equity activity is off 30%, while U.S. private equity is down 47%. Global IPOs are at $49.3 billion, 54% lower than YTD 2015.
• Toy talk: Toys ‘R’ Us CEO Dave Brandon is a longtime Republican donor who also once served as a guest judge on The Apprentice television program. Near the end of our on-stage discussion at Brainstorm Tech, I asked if who he was endorsing for president. He declined to answer, saying it wasn’t his role as the CEO of a toy company. Here was the follow-up:
Me: “Is there anything from your time behind the scenes that you learned that voters should know?”
Brandon: “Yes. Next question.”
I also asked Brandon backstage about his thoughts on Pokemon Go, and if he’s concerned about such games gaining in popularity/attention with his target audience. He acknowledged the challenges mobile games face a retailer like Toys ‘R’ Us, but added that this particular one should help boost sales of his Pokemon merchandise. “We have a whole corner of the store already devoted to Pokemon,” he said. “So this should actually be good for us.”
• Speaking of Brainstorm Tech interviews: For the full video of my conversation with Dropbox CEO Drew Houston and CO Dennis Woodside, please go here. For my session with Draymond Green, Maverick Carter and Warner Bros CEO Kevin Tsujihara, please go here.
• Smart gun follow-up: As you might imagine, I received a lot of email responses to yesterday’s column (which is posted here, for those who asked). We’ll hopefully do a mailbag on Monday. But, in the meantime, I want to quickly address two issues that many of you raised.
1. It is indeed true that many limited partnership agreements for VC and PE firms prohibit investments in weapons (alongside things like alcohol and tobacco), as part of so-called “sin provisions.” That language would need to be modified, and I think it could be under the aegis of safety.
2. I neglected to discuss the New Jersey law that requires all new handgun in the state to be equipped with “smart” technology within three years of a smart-gun being sold anywhere in the U.S. This law, while perhaps well-intentioned, has caused massive pushback by gun lobbyists and consumers (thus making it harder to entrepreneurs to get funding, due to a perceived market risk). This law must be reworked and/or repealed, as it is counterproductive.
• My deepest sympathies to those in Nice, and to those with family and friends there. Beginning to worry that such sentiments have lost their potency as these horrific acts become more routine than exceptional.
• Have a peaceful weekend.
THE BIG DEAL
• Berkshire Hathaway has submitted a bid to acquire Oncor Electric Delivery Co., a unit of Energy Future Holdings that could be valued at upwards of $18 billion, according to Bloomberg. Other likely bidders include NextEra Energy (NYSE: NEE) and an investor consortium co-led by Borealis Infrastructure Management and GIC, which already holds a 19.75% stake in Oncor. Read more.
VENTURE CAPITAL DEALS
• Endotronix Inc., a Woodridge, Ill.-based provider of reimbursable health management tools for patients suffering from advanced heart failure, has raised $32 million in Series C funding. Backers include BioVentures Investors, SV Life Sciences, Lumira Capital, Aperture Venture Partners and OSF Ventures. www.endotronix.com
• Alphabet Energy, a maker of flare combusters for oil and gas companies, has raised $23.5 million in new VC funding from Osceola Capital Management, Claremont Creek Ventures, TPG and GM Ventures Read more.
• Grow, a Provo, Utah-based business data analytics platform, has raised $11 million led by Toba Capital. www.grow.com
• CyberGRX, a Denver-based cyber risk management platform, has raised $9 million in Series A funding. Allegis Capital led the round, and was joined by The Blackstone Group, TenEleven Ventures, Rally Ventures, GV and MassMutual Ventures. www.cybergrx.com
• Amplero, a Seattle-based predictive customer lifetime value management platform, has raised $8 million in Series A funding. Wildcat Venture Partners led the round, and was joined by Globys/Trilogy Equity Partners, Salesforce Ventures and Seven Peaks Ventures. www.amplero.com
• Findo, a Menlo Park, Calif.-based smart search assistant, has raised $3 million in new seed funding from Flint Capital. It also says that it expects to soon close on another $1 million in co-investments from individual angels. www.findo.io
• Freightera, a Vancouver-based online freight marketplace, has raised C$2.1 million in new VC funding from Robson Capital, Ted Snider Financial and individual angels in California. www.freightera.com
• GameOn, a San Francisco-based mobile engagement platform for sports fans, has raised $2 million in new seed funding from Quest Venture Partners, XG Ventures, Next News Ventures the DeBartolo family, Joe Montana and Snoop Dogg. www.getgameonapp.com
• Zenrez, a San Francisco-based platform for last-minute fitness class bookings, has raised $2 million in VC funding from Artis Ventures, Summit Action Fund and Precursor Ventures. www.zenrez.com
PRIVATE EQUITY DEALS
• Estancia Capital Partners is helping to sponsor a management buyout of New York-based broker Abel Noser. No financial terms were disclosed. www.abelnoser.com
• KKR and Warburg Pincus are in talks to invest in PT Go-Jek, an Indonesian motorcycle-hailing app that could be valued north of $1 billion, according to the WSJ. Read more.
• MBK Partners has agreed to acquire Japanese golf course operator Accordia Golf Co. (Tokyo: 2131) for upwards of $12.5 billion, according to Reuters. Read more.
• Seacoast Capital has sponsored a recapitalization of The Sun Valley Group, an Arcata, Calif.-based producer of cut flowers that had been owned by KRG Capital Partners. No financial terms were disclosed. www.sunvalleyfloral.com
• Webster Capital has agreed to acquire an undisclosed stake in Lifestyle Brands, the apparel and consumer products division of Margaritaville Enterprises. No financial terms were disclosed. www.margaritaville.com
• AdvancePierre Foods Holdings, a Blue Ash, Ohio-based maker of ready-to-eat sandwiches and related products for retail and foodservice customers, raised $391 million in its IPO. The company priced 18.6 million shares at $21 per share ($20-$23 offering range), for an initial market cap of around $1.65 billion. It plans to trade on the NYSE under ticker symbol APFH, while Barclays was listed as left-lead underwriter AdvancePierre reports $46 million of net income on $1.6 billion in revenue for 2015, and is owned by Oaktree Capital Management. www.advancepierre.com
• Digital Bridge Holdings has agreed to acquire DataBank Ltd., a Dallas-based data center company, from Avista Capital Partners. No financial terms were disclosed, although Reuters reports that the deal is valued in the “several hundreds of millions” of dollars. Read more.
• Highstar Capital has hired RBC Capital Markets to find a buyer for Ports America, a Jersey City, N.J.-based terminal operator, according to Bloomberg. A deal could be valued at around $1 billion. Read more.
• Olivarius Hospitality California has acquired Coolibar Inc., a Minneapolis-based provider of sun-protective clothing, from LFE Capital and AAVIN Private Equity. No financial terms were disclosed. www.coolibar.com
• THOM Europe, the holding company for French jeweler Histoire d’Or, has agreed to acquire Italian jewelry brand Stroli from an investor group that includes Investindustrial, L Catterton, 21Investimenti, Ergon Capital, Wise and NB Renaissance. No financial terms were disclosed. www.stroilioro.com
• Amazon (Nasdaq: AMZN) has acquired Cloud9, a Los Angeles-based maker of software development tools. No financial terms were disclosed. Read more.
• Atlassian (Nasdaq: TEAM) has acquired StatusPage, a Mountain View, Calif.-based service that keeps users updated about the status of online business services. No financial terms were disclosed. Read more.
• Bayer AG (DB) BAYN) has increased its takeover bid for Monsanto (NYSE: MON) from $122 per share, which Monsanto had rejected, to $125 per share. Read more.
• MLS Co., a Chinese lighting company, is the frontrunner to acquire the light bulb and LED lamp business of Germany’s Osram Licht AG, which could be valued at just under 500 million, according to Bloomberg. Read more.
• Xerox (NYSE: XRX) does not plan to continue talks to acquire R.R. Donnelley & Sons (Nasdaq: RRD), according to the WSJ. The early discussions had come amid Xerox’s plans to split into two companies, plus R.R. Donnelley’s proposal to split into three companies. Read more.
FIRMS & FUNDS
• DCM Ventures has closed its eighth flagship fund with $500 million in capital commitments. Firm veterans Tom Blaisdell and Pete Moran are not general partners on the new vehicle, but both will continue to manage their existing investments. www.dcm.com
• Marlin Equity Partners, a California-based private equity firm focused on the lower middle markets, has closed its first Europe-focused fund with €325 million in capital commitments. The fund was only offered to existing investors in Marlin funds, and was originally targeting €200 million. www.marlinequity.com
MOVING IN, ON & UP
• Woody Benson, former head of Prism Venture Partners, has joined Launch Capital as a venture partner. www.launchcapital.com
• Jim Breyer, head of Breyer Capital and a former managing director with VC firm Accel, has been named to the board of The Blackstone Group (NYSE: BX). www.blackstone.com
Glenn Gow has joined Clear Ventures as a marketing partner. He previously was founder and CEO of Crimson Marketing. www.clear.ventures
• Mike Levitt has joined Kayne Anderson Capital Advisors as CEO. He previously was vice chairman of Apollo Credit Management. Kayne Anderson also said that former president and CEO Bob Sinnott will become co-chairman, alongside firm founder Ric Kayne. www.kaynecapital.com
• Cathrin Petty has joined CVC Capital Partners as a London-based partner and head of European healthcare investing. She previously was head of EMEA healthcare with J.P. Morgan and, before that, was a special partner with Vitruvian Partners and a partner with Apax. www.cvc.com
• Greg Reichow, former VP of production for Tesla Motors, has joined Eclipse Ventures. Read more.
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Mark King, a co-founder of private equity firm Revelstoke Capital Partners, has passed away unexpectedly while on vacation with his family. He was just 56 years old.
No additional details are currently available.
King’s board seats included Schryver Medical Holdings, RCP Upstream Holdings, Transport Holdings, Crossroads Holding, and RCP Encore Holdings. Prior to helping create Revelstoke, King had co-founded KRG Capital Partners
Rest in peace Mark.