By Polina Marinova
October 24, 2017

THREE THINGS

Good morning, Term Sheet readers.

DATA REVOLUTION: MasterCard CEO Ajay Banga told an audience at Saudi Arabia’s Future Investment Initiative conference today that “data is the new oil.” This bolsters the argument I made in yesterday’s Term Sheet about Masayoshi Son’s strategy at SoftBank. Son believes that artificial intelligence combined with data gathered by billions of sensors will bring on an “information revolution.” In other words, whoever has access, control, and ownership of proprietary data could be the modern-day John D. Rockefeller. “I believe that data is the new oil,” Banga said. “I am saying it in this country because I believe that the prosperity that oil brought in the last 50 years, data will bring in the next 50, 100 years if you use it the right way.”

UBER DRAMA: Saudi Arabia’s state-owned Public Investment Fund is expected to discuss its strategy at the same conference mentioned above. Although the fund is poised to become one of the world’s largest investors, it has hit hurdles along the way. PIF is troubled by disappointing investments and struggled to calculate its own value, according to The Wall Street Journal. The main reason for the turmoil? Uber. After the Saudi fund invested $3.5 billion in Uber last year, the ride-hailing giant used the investment to launch in Riyadh and undercut a local rival called Careem on price. This complicates things as PIF owns a majority stake in Saudi Telecom, which is an investor in Careem. Another wrinkle? Last year, PIF announced a $45 billion commitment to SoftBank. The Japanese tech giant has been working on a deal to buy shares of Uber at a value below that at which PIF invested. Depending on the structure of the investment, PIF may be forced to book a loss. The drama never ends.

MONSTER WEWORK DEAL: Guess we now know what WeWork is doing with some of that $4.4 billion SoftBank investment. The company just struck a deal to acquire Lord & Taylor’s iconic New York store for a whopping $850 million. WeWork will convert the landmark building into its global headquarters. In a time when the retail industry is experiencing sluggish sales and store closures, this doesn’t come as a shock. As part of the deal, WeWork formed a joint venture with Rhône Group, which is investing $500 million in convertible preferred shares in the retailer’s parent company, Hudson’s Bay. It’s kind of fascinating to see traditional retailers struggling to attract foot traffic and losing out to e-commerce, while WeWork is thriving by calling itself a “physical social network.” Sometimes, a well-crafted image and a check from SoftBank can do wonders.

As Fortune’s Phil Wahba reports:

“WeWork will also lease space in other HBC stores-owned in other cities. HBC, which also owns Canada’s Hudson’s Bay, Saks Fifth Avenue and Germany’s Galeria Kaufhof, said it would lease WeWorks space on the upper floors of HBC-owned stores in Toronto, Vancouver and Frankfurt.

It’s an initiative that embodies the pressures on brick-and-mortar retailers to find new ways to generate revenue from struggling stores. In its most recent quarter, HBC said comparable sales at its department stores (excluding Saks but including Lord & Taylor) had fallen.”


THE LATEST FROM FORTUNE...

• Inside Saudi Aramco’s Kingdom of Oil (by Vivienne Walt)

•Airbnb CEO: “We need more women leaders(by Leigh Gallagher)

• Snap massively overestimated demand for Spectacles (by Natasha Bach)

•AI startup raises millions to digest intel for spies, financiers and Walmart (by Robert Hackett)

…AND ELSEWHERE

Netflix is raising $1.6 billion in debt. Amazon Wine is shutting down. Facebook might start charging publishers for their posts. How long it takes to sell a home in NYC. Amazon counts its suitors. Ray Dalio says middle class needs ‘wealth transfers’


VENTURE DEALS

NeuroPace, a Mountain View-based developer of implantable devices for the treatment of neurological disorders, raised $74 million in funding. Investors include KCK Group and OrbiMed Advisors.

Eargo, a Mountain Calif.-based hearing solutions provider, raised up to $45 million in Series C funding. Nan Fung Life Sciences led the round, and was joined by investors including New Enterprise Associates, Charles and Helen Schwab and Maveron.

iAdvize, a France-based conversational marketing company, raised €32 million ($38 million) in Series C funding. Investors include Idinvest Partners, Bpifrance via Large Venture, and Quadrille Capital.

KnowBe4, a Clearwater, Fla.-based IT security company, raised $30 million in funding. Goldman Sachs Growth Equity led the round, and was joined by Elephant.

Nimble Pharmacy, a Menlo Park, Calif.-based prescription delivery startup, raised $28 million in funding. Investors include YCombinator, Sequoia Capital, First Round Capital, DAG Ventures, and Khosla Ventures.

Shift Technology, a France-based software-as-a-service platform for insurance companies, raised $28 million in Series B funding. Investors include Accel, General Catalyst, Elaia Partners and Iris Capital.

Wibbitz, a New York-based AI-powered video creation platform, raised $20 million in Series C funding. Bertelsmann Digital Media Investments led the round, and was joined by investors including The Weather Channel television network, The Associated Press, TF1 Group, NantMobile, lool Ventures, and Horizons Ventures.

Harness, a San Francisco-based delivery as a service platform, raised $20 million in Series A funding. Investors include Menlo Ventures and BIG Labs.

Abra, a Mountain View, Calif.-based digital wallet that supports bitcoin, raised $16 million in Series B funding. Investors include Foxconn’s venture subsidiary HCM International, Silver8 Capital, Ignia, Arbor Ventures, American Express Ventures, Jungle Ventures, Lerer Hippeau and RRE.

Connatix, a New York-based native video syndication and monetization platform for publishers, raised $15 million in funding. Volition Capital led the round.

Peratech, a U.K.-based provider of 3D force-sensing technologies, raised $12.4 million in funding. Merck Ventures led the round, and was joined by investors including Arie Capital.

Averon, a San Francisco-based mobile identity verification platform, raised $8.3 million in Series A funding. Avalon Ventures led the round.

Blue Medora, a Grand Rapids, Michigan-based provider of cloud systems management solutions, raised $8 million in funding. First Analysis led the round.

Jiko, an Oakland, Calif.-based personal bank, raised $7.7 million in Series A funding. Upfront Ventures and Radicle Impact led the round.

Adfenix, a Sweden-based company building software for the real estate sector, raised $6 million in Series A round funding. Investors include Notion Capital, Industrifonden, and Goodfellows.

Fattmerchant, an Orlando, Fla.-based payment technology provider, raised $5.5 million in funding from Fulcrum Equity Partners.

Alyce, Inc., a Watertown, Mass.-based AI-powered gifting platform, raised $5.3 million in funding. Boston Seed Capital led the round, and was joined by investors including Founder Collective, General Catalyst, Manifest Investment Partners and Golden Venture Partners.

Solugen, a Houston, Texas-based company focused on enzymatics and the gene editing technology CRISPR/Cas9, raised $4.4 million in seed funding. Investors include Y Combinator, Refactor Capital, MIT, Liquid 2 Ventures and Social Capital Partnerships.

Blickfeld, a Munich-based LiDAR maker for autonomous driving, raised $4.25 million in seed funding. Investors include Unternehmertum Venture Capital Partners, High-Tech Gruenderfonds, Fluxunit – OSRAM Ventures and Tengelmann Ventures.

Finn.ai, a Canada-based AI-powered virtual assistant for banking and personal finance, raised $3 million in funding. Yaletown Partners, Flying Fish Partners, and John Livingston led the round.

CardX, a Chicago-based credit card startup, raised $2.1 million in funding. NXGEN International led the round.

CountingUp, a London-based banking startup, raised £750k ($1 million) in seed funding. Frontline Ventures led the round.

Burbio, a Pelham, N.Y.-based hyper-local event aggregation platform, raised funding of an undisclosed amount, from Hudson Valley Startup Fund.

Skyhour, an air travel gifting platform, raised funding of an undisclosed amount from JetBlue Technology Ventures.


HEALTH AND LIFE SCIENCES DEALS

ADC Therapeutics, a Switzerland-based biotech company focused on developing “armed antibodies” to fight cancer, raised $200 million in funding, according to Reuters. Investors include AstraZeneca. Read more.


PRIVATE EQUITY DEALS

Serenova, which is backed by Marlin Equity Partners, acquired TelStrat, an Allen, Texas-based provider of call recording, quality, analytics, and workforce management solutions. Financial terms weren’t disclosed.

Capstone Automotive Group, which is backed by GPB Capital, acquired a majority stake in Prime Motor Group, a Westwood, Mass.-based private auto group. Financial terms weren’t disclosed.

AV Capital acquired American Insulated Glass, an Atlanta-based glass wholesale company. Financial terms weren’t disclosed.


IPOs

Funko, an Everett, Wash.-based maker of pop culture products, plans to raise $200 million in an offering of 13.3 million shares between $14 to $16 a piece. In 2016, the company posted revenue of  $426.7 million and income of $26.9 million. Acon Investments, John P. and Trishawn P. Kipp Children’s Trust, and Fundamental Capital Partners back the company. Goldman Sachs, J.P. Morgan, BofA Merrill Lynch, Piper Jaffray and Jefferies are joint bookrunners in the deal. The firm plans to list on the Nasdaq as “FNKO.”

Newmark Group, a New York City-based real estate brokerage firm, filed for an $100 million IPO. In 2016, Newmark, which includes the Newmark Knight Frank real estate firm and Berkeley Point mortgage services divisions, posted revenue of $1.4 billion and income of $168.4 million. BGC Partners backs the company. Goldman Sachs, BofA Merrill Lynch, Citigroup, and Cantor Fitzgerald are underwriters in the deal. The company plans to list on the Nasdaq as “NMRK.”

scPharmaceuticals, a Burlington, Mass.-based company seeking to commercialize intravenous treatments, filed for an $100 million IPO. The company posted loss of $24.4 million in 2016. Backers include 5AM Ventures(23.2% pre-offering), Lundbeckfond Invest A/K(22.6%), OrbiMed(23%), and Sun Pharmaceuticals(16.2%). Jefferies, Leerink Partners, and BMO Capital Markets are underwriters in the deal. The company plans to list on the Nasdaq as “SCPH.”

Bluegreen Vacations, a Boca Raton, Fla.-based timeshare resort company, filed for an $100 million IPO. In 2016, the company posted revenue of $662.6 million and income of $75 million. Stifel and Credit Suisse are bookrunners in the deal. BBX Capital backs the company. The company plans to list on the NYSE as “BXG.”

Allena, a Newton, Mass.-based company developing metabolic disorder treatments, said it plans to raise $80 million in an IPO of 5.3 million shares priced between $14 to $16 a piece. In 2016, the company posted loss of $24.5 million. The company is backed by Frazier Healthcare(18.5% pre-offering), Third Rock Ventures (16.8%), Bessemer Venture (14.6%), Fidelity (11.8%), HBM BioCapital (10.2%), PFM LP (8.9%)  and Pharmstandard International (5.4%). Credit Suisse, Jefferies, and Cowen & Company were named joint bookrunners in the deal. The company plans to list of the Nasdaq as “ALNA.”

Aquantia, a San Jose, Calif.-based Ethernet manufacturer, plans to raise $75 million in an offering of 6.8 million shares between $10 to $12 a piece. The company posted revenue of $86.7 million and loss of $277,000 in 2016. Pinnacle Ventures(10.9% pre-offering), Walden International(10.7%), Rusnano (11.1%), Mubadala Investment Company(10.3%), and Paxion Partners(6.8%). Morgan Stanley, Barclays, and Deutsche Bank are joint bookrunners in the deal. The company plans to list on the NYSE as “AQ”.

Spero Therapeutics, a Cambridge, Mass.-based company seeking a treatment for drug-resistant bacterial infections, said it plans to raise $75 million in an IPO of 5 million shares between $14 to $16 a piece. In 2016, the company posted revenue of $335,000 and loss of $29.9 million. The company is backed by GlaxoSmithKline(17% pre-offering), Atlas Venture (16.4%), and Alphabet(13.2%). BofA Merrill Lynch, Cowen and Company, Stifel, and Oppenheimer & Co. are joint bookrunners in the deal. The company plans to list on the Nasdaq as “SPRO.”

FAT Brands, a Beverly Hills, Calif.-based burger chain, raised $24 million in an Reg A+ IPO. The company offered 2 million shares at $12 a piece. In 2016, FAT posted revenue of $10.1 million and income of $4.2 million. Fogcutter Capital Group backs the company. TriPoint Global Equities is underwriting the deal. FAT listed on the Nasdaq as “FAT.”


EXITS

American Securities LLC sold Royal Adhesives & Sealants, a South Bend, Ind.-based developer of high-performance adhesives and sealants, to H.B. Fuller Co for $1.575 billion.

Vista Equity Partners agreed to sell Bullhorn, a Boston-based provider of CRM and operations software for the recruitment industry, to Insight Venture Partners. Financial terms weren’t disclosed.

The Riverside Company agreed to sell Bike24, a Germany-based online retailer of cycling and tri-sports equipment, to WiggleCRC, a portfolio company of Bridgepoint. Financial terms weren’t disclosed.


PEOPLE

B Capital Group appointed Howard Morgan as chairman and Joe Davis as vice chairman.

Whitney Sales joined Acceleprise as a general partner in the fund.

Jeff Gruccio joined Carlyle Group’s AlpInvest Partners as a principal on its primary investments team. Previously, Gruccio was at Prudential Financial.


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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.

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