Term Sheet — Monday, November 28

Nov 28, 2016

ET CETERA

Happy Cyber Monday, the only time we still use the term “cyber” to describe anything other than cybersecurity. Speaking of that, hackers are holding San Francisco’s public transit system’s data hostage.

But lets talk deals. Here’s what happened over the holiday:

$9 billion is the new decacorn: CapitalG (formerly Google Capital) and General Catalyst Partners invested $150 million into payments startup Stripe. The round doubles six-year-old Stripe’s valuation to $9 billion, just shy of $10 billion “decacorn” status. Stripe remains the second-most valuable fintech unicorn after Lufax, the Shanghai peer-to-peer lending startup. This round makes Stripe the 14th-most valuable venture-backed startup in the world.

The deal also means Stripe is twice as valuable as its publicly-traded competitor, Square. WSJ reports that Square currently processes more payments than Stripe, but Stripe is growing faster than Square’s 40% annual rate. This year hasn’t been terribly kind to young, publicly traded fintech companies. Young, privately held ones on the other hand…

Lame goats are private equity’s unicorns: For all you private equity pros wishing for your own silly animal metaphor, happy holidays from the FT.

The Spectacle of it: A reminder amid the Snapchat Spectacles frenzy that Snap Inc. didn’t whip these things up from scratch. The company has been working on connected glasses since 2014, when it acquired a Los Angeles-based company called Vergence Labs for $15 million. Vergence made a pair of connected glasses called Ephiphany Eyewear. A new Business Insider profile reveals the backstory of the company, noting that when it sold to Snap, its early investors were told, ominously, "We sold the company. We can't tell you who. You'll get a check in the mail." (Seed investors include Tim and Adam Draper, Charlie Cheever, and Joel Yarmon.) Erick Miller, a Vergence Labs co-founder that left six months after selling, has a venture firm now called Hyperspeed Ventures.

India’s First Big Down Round: In recent years, the running cliché among investors has been that “India is the new China.” One major problem with that saying is that Indian startups don’t have the same government protections against foreign competition that Chinese companies like Alibaba and Didi did. Indian startups are under pressure as U.S. giants like Amazon and Uber step up their efforts in the region. U.S. tech giants may have lost in China, but they’re not about to let that happen in India.

Which is why it’s notable that Ola, the Uber of India, is in talks to raise funding at a 40% discount to its current $5 billion valuation, according to Bloomberg. It would be the first down round for one of India’s eight billion-dollar startups, but it might not be the last. This year SoftBank, which has invested in Ola and Amazon competitor Snapdeal, has marked down its investments, mainly in India, by $513 million, according to Bloomberg.

PE in DC: Turnaround investor Wilbur Ross is reportedly Trump’s choice for commerce secretary. (Trump confirmed to the Washington Post they met about the role but hasn’t officially announced anything.) Ross is currently Chairman and Chief Strategy Officer of the investment firm WL Ross, which became a subsidiary of Invesco in 2006. Worth noting WL Ross’s performance over the last decade, according to CalPERS: Fund three, a 2005 vintage, carries a 0.8x multiple with a negative IRR. Fund four, a 2007 vintage, has an IRR of 8.1% and a 1.4x multiple. CalPERS doesn’t include the firm’s fifth fund, which took two years to raise $2.2 billion in 2012, only after cutting its target from $4 billion.

I’m told Ross hasn’t been involved in the “day-to-day” operations at WL Ross for some time now. Co-heads Stephen J. Troy and Gregory A. Stoeckle handle that. However, Ross is still a senior manager and his name is on the door. I’ve asked the firm whether his leaving would trigger a keyman provision, but the firm isn’t commenting on the news.

Mitt in the middle: Our other PE in DC is currently being punished for speaking out against Trump. Over the weekend Trump surrogate Kellyanne Conway attacked potential Secretary of State Mitt Romney, noting that he was “nothing but awful” to Trump for a year. Apparently that was a rogue move; MSNBC is reporting that Trump is “furious” about Conway’s comments.

Keep in touch: After I publish Term Sheet every morning, I usually jump on Twitter. Join the conversation here: @eringriffith.

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VENTURE DEALS

Stripe, a San Francisco-based online payments company, raised $150 million at a $9 billion valuation (it was last valued at $5 billion in July, 2015). Alphabet’s CapitalG and General Catalyst led the round. Sequoia Capital also participated. Read more at Fortune. [Note: A typo which confused "million" and "billion" has this item has been corrected.]

Kymab, a Cambridge, U.K.-based developer of human monoclonal antibody therapeutics, raised $100 million in Series C funding. ORI Fund led the round, and was joined by Wellcome Trust, Bill & Melinda Gates Foundation, Shenzhen Hepalink Pharmaceutical, Malin Corporation, CF Woodford Equity Income Fund and Woodford Patient Capital.

•  Capital Confirmation, a Brentwood, Tenn. a platform for managing audits, raised $60 million from Boston-based private equity firm Great Hill Partners.

Wynd, a Paris SaaS provider that enables restaurant chains to digitize their points of sale, raised $31.7 million in Series B funding, according to TechCrunch. Sodexo Ventures and Orange Digital Ventures led the round. Bpifrance also participated. Read more.

Palantir Technologies, a Palo, Alto-based big data firm co-founded by Peter Thiel, raised $20 million in new funding from an unidentified backer, according to an SEC filing. The company last raised $880 million in December 2015 at a $20 billion valuation.

• Allied Minds-subsidiary HawkEye 360, a Boston developer of a space-based radio frequency mapping and analytics systems, raised $11 million in Series A funding. Razor’s Edge Ventures led the round.

TermScout, a Louisville, Colo. sales intelligence provider, raised $3.2 million in Series A funding.

ArangoDB, a German developer of database solutions, raised £2.2 million ($2.3 million) in funding. Target Partners led the round.

Sightbox, a Portland, Ore. on-demand contact lens startup, raised $1.8 million in funding. Rogue Venture Partners led the round, and was joined by Jumpstart Foundry, Portland Seed Fund and VistaRiver Healthcare Solutions.

PRIVATE EQUITY DEALS

•  L Catterton, a Greenwich, Conn.-based consumer-focused private equity firm, has invested in Brazilian supermarket chain St. Marche. Financial terms were not disclosed.

•  LeapFrog Investments has bought a $22 million majority investment in GoodLife Pharmacy, which operates pharmacies in Kenya.

•  Platte River Equity has made an investment in In-Place Machining Company, an on-site field machining services provider.

•  Align Capital Partners has invested in Alliance Source Testing, a Decatur, Ala.-based developer of source emissions testing services. Financial terms were not disclosed.

OTHER DEALS

Samsung is considering whether to split itself in two. Under the plan, which was proposed by activist hedge fund Elliott Management, the company would divide into a holding company and an operating company. The board is expected to respond to the proposal Tuesday. Read more at Fortune.

GoDaddy, an Arizona-based web hosting service, is reportedly in talks to acquire Host Europe Group (HEG), a European provider of web hosting, for 1.7 billion euros ($1.8 billion). Read more at Fortune.

Time Inc., the publisher of magazines including People, Sports Illustrated, Time, and Term Sheet publisher Fortune, has rejected billionaire Edgar Bronfman Jr.’s bid to purchase the company for $18 a share, according to the New York Post. The offer represents a 30.4% premium from the company’s close Friday.

Amazon is reportedly in talks to acquire Souq.com, a Dubai-based online retailer, for $1 billion. Read more at Fortune.

Johnson & Johnson has approached Swiss biotechnology firm Actelion with a takeover offer. The Swiss biotechnology company, which specializes in blood pressure drugs, has a market cap of around $20 million. Read more at Fortune.

IPOs

CSC Financial Co., a Beijing-based brokerage and investment bank, is seeking to raise as much as $1.06 billion in an Hong Kong initial public offering, according to Bloomberg. Read more.

Meitu, a Xiamen, China-based mobile phone and app maker, is scheduled to raise $735 million in an Hong Kong IPO that would value the company at as much as $4.5 billion, according to Reuters. Shares will be offered for between HK$8.50 and HK$9.60 ($1.10-$1.24). Read more.

EXITS

• Chinese travel company Ctrip.com International has agreed to buy Skyscanner, an Edinburgh, U.K.-based travel search site, for £1.4 billion ($1.74 billion). Skyscanner, which raised £128 million pounds in January, is backed by investors including Malaysia’s sovereign fund, Khazanah Nasional and Yahoo Japan. Read more at Fortune.

• CNN has agreed to acquire Beme, a New York City video-sharing social media app founded YouTube celebrity Casey Neistat and ex-Tumblr head of engineering Matt Hackett, according to The New York Times. Beme is backed by Lightspeed Venture Partners and Vayner/RSE. Financial terms were not disclosed. Read more.

• Edwards Lifesciences Corp has agreed to buy Valtech Cardio, an Israeli cardiovascular device manufacturer, for $340 million in stock and cash, according to Reuters. Valtech raised about $100 million from Peregrine Ventures, OXO Capital Valve Ventures, and NGN Capital. Read more.

Q Holding, a 3i portfolio company, has agreed to buy Degania Silicone, an Israeli medical catheters manufacturer, from Viola Private Equity, Kibbutz Degania Bet, and Israel Growth Investors.

FIRMS + FUNDS

BMW is increasing the size of its venture fund, BMW i Ventures, from £100 ($106 million) to £500 million ($529 million). The firm will also relocate, moving from New York City to San Francisco. Read more at Fortune.

BDC Capital, a Toronto-based bank, has raised $135-million for BDC Capital Industrial, Clean and Energy Technology (ICE) Venture Fund II. The fund will back Canadian energy and cleantech start-ups.

 Falcon House Partners, a Jakarta, Indonesia-based private equity firm, closed its second fund, Falcon House Partners II, at $400 million.

IK Investment Partners, a UK private equity firm, raised £1.85 billion ($1.96 billion) for its eighth fund, IK VIII Fund.

NEW JOBS

• Burak Çendek has joined Revo Capital. Çendek previously ran an accelerator program at 1871-Chicago.

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