CO-WORKING WARS
Good morning, Term Sheet readers.
Industrious, a co-working office space startup that competes with WeWork, raised $80 million in venture funding. Riverwood Capital and Fifth Wall Ventures led the round. The startup said it’ll use the funds to continue growing its roster of corporate clients. So far, Industrious says it expanded its shared office space footprint to 25 U.S. cities last year and grew revenue by 150% over the past three years.
That’s impressive, but it’s hard to ignore the fact that Industrious will go head to head with WeWork, the 800-pound gorilla backed by SoftBank. Industrious CEO Jamie Hodari told Axios that he’s not worried about the competition because WeWork is “a mass product, while his company is providing a premium product for a different type of customers.” Of course, that statement is not quite accurate as WeWork is going after corporate clients as well, including GE, HSBC, Salesforce and Microsoft.
Here’s the thing: Money matters. As Uber CEO Dara Khosrowshahi said about accepting an investment from SoftBank, "Rather than having their capital cannon facing me, I'd rather have their capital cannon behind me." And right now, Industrious’ total venture funding of $142 million pales in comparison to WeWork’s $6.9 billion. Fifth Wall Ventures partner Brad Greiwe said, “While billions of dollars of SoftBank money is extremely helpful, one thing that SoftBank doesn’t control is the assets themselves.”
Although this sounds good, it’s unclear what is meant by “control the assets” given that both WeWork and Industrious lease properties and then sublease to their customers. ¯\_(ツ)_/¯
BIG BID: Comcast launched itself into the middle of the planned takeover of the British broadcast giant Sky by 21st Century Fox, with a competing bid that blows the Fox offer out of the water. Comcast has now offered £12.50 ($17.46) per share of Sky, which is 16% higher than Fox’s offer and would give Sky an equity value of $31 billion. A Sky acquisition would be a big deal for Comcast because it would take its international earnings from a 9% share of total revenues to a full quarter. Read more at Fortune.
LET'S MEET: I'll be moderating a VC panel at Navigate 2018: Women in Enterprise Tech Summit in New York City tomorrow, and I'd love to meet some of you in person. If you're planning to attend, say hi!
THE LATEST FROM FORTUNE...
• Someone Stole 7 Bitcoins from Apple Co-Founder Steve Wozniak (by Hallie Detrick)
• Are You a Coinbase User? Your Data Could Be on Its Way to the IRS (by Casey Quackenbush)
• Rapper 50 Cent Says He Isn't Actually a Bitcoin Millionaire (by Aric Jenkins)
• Here's Why Warren Buffett Has 'Bought More Apple Than Anything Else (by Don Reisinger)
...AND ELSEWHERE
More details of Blossom Capital emerge. Companies are using tax cuts to spend more on themselves than on wages. Secretive U.S. security panel discussing Broadcom's Qualcomm bid. Bitcoin bitterness starts to make messy divorces even worse. Social Capital’s Chamath Palihapitiya wants to fix capitalism.
VENTURE DEALS
• Peakon, a London and Copenhagen-based people analytics company, raised $22 million in funding. Balderton Capital led the round, and was joined by investors including EQT Ventures fund, Idinvest Partners, and Sunstone.
• CyberX, a Boston-based company that monitors industrial networks for targeted attacks, raised $18 million in Series B funding. Norwest Venture Partners led the round, and was joined by investors including Glilot Capital Partners, Flint Capital, ff Venture Capital and OurCrowd.
• May Mobility, an Ann Arbor, Mich.-based manufacturer of autonomous vehicles, raised $11.5 million in seed funding, according to TechCrunch. Investors include BMWi Ventures and Toyota AI Ventures. Read more.
• Moltin, a provider of an API-based digital commerce solution, raised $8 million in Series A funding. Underscore VC led the round, and was joined by investors including Connect Ventures and Frontline Ventures.
• ZenBusiness, an Austin, Texas-based company helping small businesses launch, raised $4.5 million in seed funding. Lerer Hippeau led the round, and was joined by investors including Greycroft, Slow Ventures, Revolution’s Rise of the Rest Seed Fund and Founders Fund.
• Spring Discovery, a Palo Alto, Calif.-based machine learning-based drug discovery platform provider, raised $4.25 million in seed funding. Investors include General Catalyst, First Round, Sam Altman and the Longevity Fund.
• Seneca Systems, a Redwood City, Calif.-based provider of software for government workers, raised $3.5 million in seed funding. Initialized Capital led the round, and was joined by investors including Govtech Fund, Cowboy Ventures, and Y Combinator.
• PawnGuru, a Detroit-based online marketplace connecting consumers with local pawn shops, raised $2.5 million in Series A funding. Impact America Fund and Invest Detroit Ventures led the round.
• InStitchu, a Sydney, Australia-based startup selling custom tailored suits and other menswear, raised $2.5 million in funding. Investors include Dayang Group.
HEALTH AND LIFE SCIENCES DEALS
• Senti Biosciences, a South San Francisco-based company focused on research of synthetic biotechnology to develop therapeutics, raised $53 million in funding, according to TechCrunch. New Enterprise Associates led the round round, and was joined by investors including 8VC, Amgen Ventures, Pear Ventures, Lux Capital, Menlo Ventures, Allen & Company, Nest.Bio, Omega Funds, Goodman Capital, and LifeForce Capital. Read more.
PRIVATE EQUITY DEALS
• HG Capital will sell Iris Software Group Ltd, a U.K.-based provider of accounting and payroll software, in a deal that could value the software company at over 1 billion pounds ($1.4 billion), according to SkyNews.
• Cerberus Capital Management LP agreed to buy Bluestone Holdings Australia. Financial terms weren’t disclosed, but media reports peg the sale at approximately $103 million.
• Francisco Partners agreed to buy a majority of Discovery Education, a Silver Spring, Md.-based provider of digital content for students, from Discovery Communications Inc for $120 million.
• Catalyst Development, which is backed by Livingbridge, acquired Knadel, a London-based investment management consultancy. Financial terms weren’t disclosed.
• A consortium of unnamed private equity firms acquired PhishMe, a Leesburg, Va.-based provider of phishing defense solutions. The deal values PhishMe at $400 million. PhishMe is rebranding as Cofense.
• M&Q, a portfolio company of Capital Partners, acquired Flavorseal, an Avon, Ohio-based food packaging company. Financial terms weren't disclosed.
• Parthenon Capital Partners invested in RedCard, a St. Louis, Mo.-based provider of claims communications, payments and enrollment solutions to healthcare providers, payors and members.
• L Squared Capital Partners invested in United Scope, a provider of microscopes and related accessories. Financial terms weren’t disclosed.
• Butterfly acquired Modern Market, a farm-to-table fast casual restaurant company. Financial terms weren't disclosed.
OTHER DEALS
• Liberty Media Corp proposed to buy a 40% stake in a restructured version of iHeartMediaInc (OTCPK:IHRT) for $1.16 billion, according to Reuters. Read more.
IPOs
• FMC Corp., the Philadelphia-based chemical goods maker, is revving up for a $500 million IPO of its lithium business on the NYSE this year, Reuters reports citing the company’s chief financial officer. Read more.
• Glassdoor, a Mill Valley, Calif.-based job searching website, is seeking banks for an IPO as soon as this year, Bloomberg reports citing sources. The company is valued at over $1 billion. Read more.
FIRMS + FUNDS
• LLR Partners, a Philadelphia-based middle-market private equity firm, raised $945.05 million for its fifth fund.
• RRE Ventures, a New York-based venture capital firm, raised $218.75 million for its seventh fund. The target is $250 million.
• Causeway Media Partners, a Boston-based venture capital firm, raised $211.3 million for its second fund.
PEOPLE
• Heitman LLC named Tony Smedley as managing director, head of European private equity.
• BGF Ventures partners Harry Briggs, Rory Stirling, and Wendy Tan White are departing the firm. Read more.
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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.
