On deals and dealmakers.
POLITE AND HOSPITABLE
New money: Obvious Ventures has officially closed its second fund with $191,919,191 million in commitments. (A filing from last month revealed a first close.) The firm’s first fund featured a numeric joke – it had $123,456,789 million in commitments – so it’s only fitting that this one do the same. The fund two total is a palindrome, which is meant to symbolize that its next chapter look just like its first one – same team, same three managing directors, same “world positive” strategy (don’t call it social good!).
Obvious Ventures won’t be adding another partner to help it deploy the larger fund. Rather, the firm may write larger checks, co-founder and managing director James Joaquin says. The company still anticipates that 80% of its deals will be the first “priced” funding round for the startups it backs. The difference is that startups are raising much larger Series A rounds of funding, some as high as $7 million to $10 million.
“The market for convertible debt from angel investors is so robust that we’re seeing companies that have raised several million of convertible debt before they ever get to their first priced round,” Joaquin says. These companies are further along, too, with products, customers, and revenue, justifying a bigger round and valuation. “Our first fund was too small to lead some of those deals,” he says, but now it can.
By the way, I asked whether it was tricky to get LP checks to line up at such a precise amount, and was told only one LP needs to be in on the joke, making their subscription a very specific number. In Obvious Ventures’ case, that LP its largest: Twitter and Medium co-founder Evan Williams.
Williams represents just over 50% of the second fund with a larger check size compared to fund one, but a slight decrease in the percentage of the overall fund. This fund includes more than a dozen new institutional investors.
New money: Private equity has a new, rich rival: The government of Monaco. The city-state, which has one of Europe’s highest concentrations of millionaires, has retained merchant bank Scepter Partners to manage $20 billion worth of “private-equity-style” investments, the Wall Street Journal reports. Read more.
M&A: Remember when Verizon CEO Lowell McAdam said he was open to merger talks with Comcast? Well, that was just McAdam being “a polite and hospitable person.” He walked back that statement on Verizon’s earnings call today. Fortune’s Aaron Pressman reports:
Analysts read McAdam’s new tone loud and clear. “The biggest takeaway from Verizon’s meeting with analysts was its subdued tone on M&A,” UBS analyst John Hodulik noted on Tuesday. ” The company prefers to grow organically and thinks there is more hype than reality following recent media reports.”
Excitement about potential telecom consolidation has been swirling since President Trump was elected, but it has fizzled in recent weeks. Sprint’s CEO talked down deal speculation, and the Charter-Comcast partnership kills hope for a big wireless merger. Read more.
Spectacle: Snap reports its first quarterly earnings tonight. The stakes are high!
THE LATEST FROM FORTUNE...
• Trump’s Tuesday night massacre.
• EU will review trading practices by tech giants like Apple and Google.
• Amazon’s bot army is trouncing Walmart in ecommerce.
• The end of the line for Pandora?
• How Dell is using machine learning to help female entrepreneurs.
• EU expected to approve Broadcom deal.
• Demograts call for investigation into Icahn’s biofuel business.
• The truth about talking black.
• Gilette is betting on texting to compete with Dollar Shave Club.
• HPE bets Singapore will be a ‘miniature Silicon Valley.’
What happens to whistleblowers in Silicon Valley. Private equity’s upper hand in loan repricing. America’s news deserts. Home sweet home for the billionaire cable cowboy. America’s national pastime: fidget spinning. Disentangling democracy from geography. Women Who Work isn’t a good book. Jeffrey Gundlach is tweeting. The Trump administration as a corporate risk factor. Compliance officers find themselves in an awkward position. Dodd-Frank rewrite would increase the chance of a bailout. Chinese propaganda via children’s bedtime stories. HNA’s buying spree. Canadian AI is thriving. Yelp crash.
• Gainsight, a Redwood City, Calif.-based enterprise software provider, raised $52 million in Series E funding. Lightspeed Venture Partners led the round. Existing investors Battery Ventures, Bain Capital Ventures, Bessemer Venture Partners, Salesforce Ventures and Insight Venture Partners, Cisco Investments participated.
• Cockroach Labs, a New York-based open-source database software developer, raised $27 million in Series B funding. Redpoint led the round, and was joined by Benchmark, GV, First Mark and Index Ventures.
• Opcity, an Austin, Texas-based real estate technology company raised $27 million in Series A funding. Icon Ventures led the round, and was joined by Georgian Partners and LiveOak Ventures.
• Attivo Networks, a Fremont, Calif.-based cybersecurity defense technology developer, raised $15 million in Series B funding. Investors include Omidyar Technology Ventures, Bain Capital Ventures, Trident Capital Cybersecurity and Macnica Ventures.
• Updox, a Dublin, Ohio-based document management solutions provider, raised $12.7 million in Series B funding. TT Capital Partners led the round, and was joined by Tamarind Hill and Rev1 Ventures.
• Mya Systems (formerly known as FirstJob), a San Francisco-based AI recruitment tool developer, raised $11.4 million in in Series A funding. Emergence Capital led the round.
• Remix, a San Francisco-based public transit planning company, raised $10 million in Series A funding. Sequoia Capital led the round.
• Latch, a New York-based smart lock maker, raised $10 million in Series A funding from RRE Ventures.
• Dropoff, an Austin, Texas-based delivery service provider, raised $8.5 million in Series B funding. Fulcrum Equity Partners led the round. Existing investors Greycroft Partners and Correlation Ventures participated.
• Perspectium Corporation, a San Diego, Calif.-based enterprise application integration provider, raised $8 million in Series A funding. TVC Capital led the round.
• Owl Labs, a Somerville, Mass.-based smart video camera manufacturer, raised $6 million in Series A funding. Matrix Partners led the round.
• Ceres Imaging, an Oakland, Calif.-based aerial spectral imagery and analytics company, raised $5 million in Series A funding. Romulus Capital led the round. [This item has been updated to reflect the correct headquarters city.]
• 1001 Salles Group, a France-based event space company, raised €4 million ($4.3 million). Investors include Rives Croissance and Cap Horn Finance.
• Simple Habit, a San Francisco-based mobile meditation app company, raised $2.5 million in funding. Investors include New Enterprise Associates, FJ Labs, Foundation Capital, Drew Houston and Joshua Reeves.
• Cover, a Los Angeles-based custom backyard studio manufacturer, raised $1.6 million in seed funding. Investors include General Catalyst and Khosla Ventures.
• Interior Define, a Chicago-based furniture manufacturer, raised 8 million in funding. Breakout Capital led the round, and was joined by Pritzker Group Venture Capital and Listen Ventures.
• Fluence Analytics, formerly known as Advanced Polymer Monitoring Technologies, a New Orleans, La.-based laboratory monitoring systems manufacturer, raised an undisclosed amount in Series A funding. Energy Innovation Capital led the round.
• Infinite Analytics, a Cambridge, Mass.-based AI and deep learning company, raised an undisclosed amount in funding from Byramjee Jeejeebhoy Group.
HEALTH AND LIFE SCIENCES DEALS
• OptiNose, a Yardley, Penn.-based allergy specialty pharmaceutical company, raised $37 million Series D funding. Fidelity Management and Research Company led the round, and was joined by investors including Avista Capital Partners and Entrepreneurs Fund.
• BC Platforms, a Basel, Switzerland-based genomic data management solutions provider, raised $9 million in funding. The Debiopharm Innovation Fund and Tesi co-led the round.
PRIVATE EQUITY DEALS
• Warburg Pincus invested $231 million in Modernizing Medicine, an electronic medical record systems developer.
• Long Ridge Equity Partners, invested $42 million for a minority stake in Broadway Technology, a New York-based high-performance software provider for financial institutions.
• AID Partners acquired GeneSort, an Israel-based molecular diagnostics company, for $23 million, according to Tech.eu. Read more.
• Genstar Capital agreed to recapitalize Apex Fund Services, a Bermuda-based fund administration services company, and acquire Equinoxe Alternative Investment Services, a Bermuda-based alternative investment fund administration services provider. Financial terms weren’t disclosed.
• Cimarron Healthcare Capital recapitalized Advanced Medical Pricing Solutions, a Chamblee, Ga.-based medical bill review provider. CHC led an investor group that includes RAF Industries and Leavitt Equity Partners. Financial terms weren’t disclosed.
• Kohlberg & Co acquired Pexco, an Alpharetta, Ga.-based specialty plastics manufacturer, and merged it with portfolio company, PPC Industries. The newly-formed company is called Spectrum Plastics Group. Financial terms weren’t disclosed.
• J.F. Lehman & Company acquired BEI Precision Systems & Space Company, a Maumelle, Ark.-based sensor technologies company. Financial terms weren’t disclosed.
• Care Advantage, a portfolio company of BelHealth Investment Partners acquired Stay at Home Personal Care, a Virginia-based personal care services provider and subsidiary of Commonwealth Senior Living. Financial terms weren’t disclosed.
• Summit Partners, with participation from Noro-Moseley Partners, made a growth equity investment of an undisclosed amount in MacStadium, an Atlanta-based Apple Mac-focused server hosting provider.
• Levine Leichtman Capital Partners completed the sale of Champion Manufacturing, an Elkhart, Ind.-based medical seating product developer. Financial terms weren’t disclosed.
• Abercrombie & Fitch (NYSE:ANF) has hired Perella Weinberg Partners to field takeover interest from other retailers. Read more at Fortune.
• Apollo Global Management has agreed to acquire West Corp (Nasdaq:WSTC), an Omaha, Neb.-based telephone conferencing service provider, for $2 billion, according to Reuters. The $23.50 per share offer represents a 17.5% premium to West Corp’s closing price on November 1, 2016. Read more.
• NC Research Holdings (Nasdaq:INCR) and inVentiv Health, a Burlington, Mass.-based healthcare and pharma consulting company, have agreed to merge to form a global pharmaceutical solutions organization. The deal values inVentiv at approximately $4.6 billion, and the combined company at approximately $7.4 billion.
• DHX Media Ltd will acquire the entertainment unit of Iconix Brand Group (Nasdaq:ICON), a New York-based brand management company that owns brands like “Bob the Builder” and “Teletubbies,” for $345 million. Read more.
• Five Point Holdings, an Aliso Viejo, Calif.-based real estate company priced significantly below its range of $18 to $20 a share Tuesday. The company priced 21 million shares at $14 a piece, raising $294 million. Five Point will list on the NYSE under ticker symbol “FPH.” Citigroup, J.P. Morgan, RBC Capital Markets, and Wells Fargo are lead underwriters in the deal.
• Guaranty Bancshares, a Texas-based consumer bank, closed at up by 11% following its first day of trading on the Nasdaq Wednesday. The bank traded on ticker symbol “GNTY.”
• Axa, a France-based insurance giant is planning an IPO of its U.S. operations–including a 64% stake in troubled asset manager Alliance Bernstein. Axa is also planning on converting some $1 billion of outstanding debt into equity ahead of the IPO.
• Pret A Manger, the U.K.-based sandwich chain, has appointed bankers to lead an IPO in the U.S. likely before year’s end, according to Bloomberg. Private equity firm Bridgepoint Advisers appointed J.P. Morgan Chase and Jefferies to lead the offering. Piper Jaffray, Credit Suisse, and Barclays are also reportedly working on the deal.
• Zhonghong Zhuoye Group has completed its purchase of a 21% stake in SeaWorld Entertainment (NYSE: SEAS) at a price of $23 a share or about $449 million. The seller was Blackstone Group was the seller.
• Surgery Partners (NASDAQ:SGRY) agreed to acquire National Surgical Healthcare, a Chicago-based owner and operator of surgical facilities from Irving Place Capital for approximately $760 million. In conjunction with this transaction, Bain Capital Private Equity will acquire H.I.G. Capital’s existing equity stake in Surgery Partners.
• Apple acquired Beddit, a Finland-based smart bed sensor developer. Financial terms weren’t disclosed. Beddit raised more than $3 million in venture funding from investors including Inventure Oy and Finnvera Venture Capital. Read more at Fortune.
• Uala, a Milan-based online booking platform for health and beauty treatments, acquired Bucmi, a Madrid-based beauty salons booking platform, according to Tech.eu. Financial terms weren’t disclosed. Bucmi raised more than $3 million in venture funding from investors including Onza Capital and Pablo Lago. Read more.
FIRMS + FUNDS
• Delta-v Capital, a venture capital and private equity firm with locations in Dallas, Texas and Boulder, Colo., raised $232 for its third fund.
• SVB Capital, a Menlo Park, Calif.-based venture capital investment arm of SVB Financial Group, raised $225 million for its fourth fund.
• Sarah Tavel joined Benchmark as a general partner. Tavel was previously a partner at Greylock Partners.
• Fred Destin, a European VC who recently left his role as a general partner at Accel, and Harry Stebbings, host of the “Twenty Minute VC” podcast and former entrepreneur-in-residence at Atomico, will be raising a seed fund together, according to TechCrunch. Read more.
• Rohit Bassi joined Corridor Capital as a managing director on the operations team. Bassi was previously at Ampersand Biopharmaceuticals.