Good morning, Term Sheet readers.
As some of you know, I’m at Fortune’s Most Powerful Women Summit in Laguna Niguel, Calif. So three things: 1) I’m writing Term Sheet at the most brutal, ungodly hour of 4 a.m. PST, so please forgive any typos. 2) If you’re here, say hello! 3) And if you’re not, you can watch the main-stage sessions on our livestream here.
The highlight of yesterday’s event was a one-on-one conversation with Alphabet CFO Ruth Porat. Fortune’s Andrew Nusca reports:
Before Ruth Porat became the chief financial officer of both Google and its parent company Alphabet, she worked at Morgan Stanley. There, she—like many others in the financial industry—slogged through what became the 2008-2009 financial crisis, leading a team that advised the U.S. Department of Treasury on Fannie Mae and Freddie Mac and the New York Federal Reserve Bank on AIG.
The experience left an impression on her, she said Monday at Fortune’s Most Powerful Women Summit in Laguna Niguel, Calif. “One of the really important lessons for all industries that I took away from the work during the financial crisis—it applies to all industries in good times and bad—is: What are the unintended consequences of everything we’re doing, and how do we each stay ahead of those?” she said.
STAYING LEAN: While its peers are busy raising billion-dollar mega funds, VC firm Benchmark is staying true to its core and raising $425 million for its ninth flagship fund. But it’s doing so without two of its longtime general partners, Matt Cohler and Mitch Lasky. Rather, Sarah Tavel, Chetan Puttagunta and Eric Vishria are expected to replace the pair in the new fund.
I asked Tavel in August about why Benchmark’s staying (somewhat) lean is a good strategy at a time when its rivals are raising larger and larger funds. She said:
“We went through a period very soon after our founding when we did try to scale. We had Benchmark London, Benchmark Israel, we had more GPs in our Silicon Valley office — and our returns suffered. For us, that was a lesson that in order to be the best, we had to focus and stay lean.”
A few days before our interview, The Wall Street Journal had reported that Benchmark is sitting on one of the most profitable venture funds since the dot-com boom. The fund, which raised approximately $550 million in 2011, has reportedly multiplied investors’ money ~25 times. So, it looks like Benchmark sees value in sticking with a smaller pool of capital even in The Era of the Mega Fund.
…AND STAYING NOT SO LEAN: Cybersecurity startup Tanium raised $200 million in funding at a $6.5 billion valuation. Wellington Management led the round, and was joined by investors including Baillie Gifford & Company and Adage Capital Management. The company last raised $175 million at a $5 billion valuation in May.
Earlier this year, Tanium’s CEO Orion Hindawi gave Fortune an exclusive look at the company’s books. The company made “well over $200 million in revenue” over the course of its last fiscal year, Hindawi told Fortune in March, growing 70% over the year prior. Tanium’s annual recurring revenue grew more than 80% to approximately $230 million in the past year, he added.
The company’s COO and CFO Fazal Merchant told TechCrunch that its newest fundraise was focused on bringing on new investors & providing liquidity to early ones. He said, “We have friends and family who have been investors for a long time and this gives them liquidity.”
• Project44, a Chicago-based advanced visibility platform for shippers and third-party logistics firms, raised $45 million in funding. Sapphire Ventures led the round.
• Petal, a New York-based fintech credit card company, raised $34 million in funding. Investors include Jefferies and Silicon Valley Bank.
• Gremlin, a San Jose, California-based provider of a framework to simulate real outages in a company’s system, raised $18 million in Series B funding. Redpoint Ventures led the round.
• Arcadia Data, a provider of data analytics services, raised $15 million in Series B funding. Pelion Venture Partners led the round, and was joined by investors including Intel Capital, Mayfield Fund, and Blumberg Capital.
• Cherre, a New York-based real estate data platform, raised $9 million in seed funding. Navitas Capital led the round.
• DrumG Technologies, a New York-based fintech company, raised $6.5 million in Series A funding. Investors include ConsenSys.
• Meatable, a cell-based meat startup, raised $3.5 million in funding. BlueYard Capital led the round, and was joined by investors including Atlantic Food Labs and Future Positive Capital.
• Torchlite, a platform for finding and managing on-demand digital marketing talent, raised $3 million in funding. Investors include Scott McCorkle and Salesforce Ventures.
• FREY, a San Francisco-based clothing care startup, raised $2.4 million in seed funding. Investors include Soma Capital, Sutardja Ventures, 1984 Ventures, and Break Trail Ventures.
• Remedy Review, a digital publishing company focused on covering the hemp, cannabinoids, and natural health space, raised $2 million in funding, from One Better Ventures.
• Re:Store, a co-working and retail space for online brands, raised $1.7 million in pre-seed funding. Sequoia and South Park Commons co-led the round, and were joined by investors including 122West Ventures and XFactor Ventures. Read more at Fortune.
HEALTH AND LIFE SCIENCES DEALS
• Pivot Bio, a San Francisco-based ag tech company who’s rethinking crop nutrition, raised $70 million in a Series B funding. Breakthrough Energy Ventures led the round.
• VelosBio, a San Diego, Calif.-based biotech firm focused on oncology, raised $58 million in Series A funding. Arix Bioscience plc and Sofinnova Ventures led the round, and were joined by investors including Pappas Ventures, Chiesi Ventures, Takeda Ventures Inc and Decheng Capital.
• Modis Therapeutics, an Oakland, Calif.-based developer of medicines for patients with rare genetic diseases, raised $30 million in Series A funding. F-Prime Capital Partners and OrbiMed led the round.
PRIVATE EQUITY DEALS
• Platinum Equity acquired LifeScan, a Milpitas, Calif.-based manufacturer and supplier of blood glucose monitoring equipment, from Johnson & Johnson (NYSE: JNJ) for approximately $2.1 billion.
• Behrman Capital acquired kSARIA, a Methuen, Mass.-based producer of mission critical connectivity solutions for the aerospace and defense end markets. Financial terms weren’t disclosed.
• Alleghany Capital acquired a majority stake in Concord Hospitality Enterprises Company, a Raleigh, N.C.-based hotel management and development company. Financial terms weren’t disclosed.
• TSG Consumer Partners acquired a minority stake in Dutch Bros Coffee, a drive-thru coffee company. Financial terms weren’t disclosed.
• AkzoNobel sold its specialty chemicals business to The Carlyle Group and GIC. The deal was valued at 10.1 billion euros ($12.57 billion).
• Ansira Partners, which is backed by Advent International, acquired Defakto, a Dallas-based marketing tech agency. Financial terms weren’t disclosed.
• Cotton Creek Capital acquired Vecta Environmental Services LLC, a Gonzales, La.-based industrial and environmental services provider for chemical, industrial, utilities and oil & gas midstream customers along the U.S. Gulf Coast region. Financial terms weren’t disclosed.
• Clayton, Dubilier & Rice acquired PowerTeam Services LLC, a Cary, N.C.-based provider of maintenance and construction services for the U.S. utility industries. Financial terms weren’t disclosed.
• Watervale Equity Partners acquired EMX, a Cleveland-based maker of sensors and controls for the access control industry and process automation applications for various industrial markets. Financial terms weren’t disclosed.
• ACV, a portfolio company of Kinderhook Industries LLC, acquired CTR Industries Inc, a Bridgeport, Conn.-based provider of industrial services. Financial terms weren’t disclosed.
• Silversmith Capital Partners made an investment in MediQuant, a Brecksville, Ohio-based provider of enterprise active archiving solutions for hospitals and health systems. Financial terms weren’t disclosed.
• Ox Engineered Products, a portfolio company of Wind Point Partners, acquired HomeGuard Building Products Inc, a Jacksonville, Fla.-based maker of micro-perforated woven and non-woven polyolefin housewraps. Financial terms weren’t disclosed.
• Stellex Capital Management acquired Grammer Industries, Inc, a Grammer, Ind.-based provider of transportation services. Financial terms weren’t disclosed.
• Livent, Philadelphia, Penn.-based lithium batteries maker for electric cars spun out of FMC, plans to raise $380 million in an IPO of 20 million shares priced between $18 to $20. The segment posted revenue of $347.4 million and income of $42.2 million in 2017. BofA Merrill Lynch, Goldman Sachs and Credit Suisse are underwriters. FMC backs the firm. It plans to list on the NYSE as “LTMH.” Read more.
• Anaplan, a San Francisco, Calif.-based plans to raise $217 million in an offering 15.5 million shares priced between $13 to $15. Shasta Ventures, Premji Invest, and Granite Ventures back the firm. The firm posted revenue of $168.3 million and loss of 47.6 million. Goldman Sachs, Morgan Stanley and Barclays are underwriters. It plans to list on the NYSE as “PLAN.” Read more.
• Upwork, a Mountain View, Calif.-based marketplace for businesses to hire and manage, plans to raise $160 million in an offering of 12.3 million shares priced between $12 to $14. The company posted revenue of $202.6 million and loss of $10.6 million in 2017. Benchmark (15% pre-offering), Sigma Partners (14.2%), and Globespan Capital Partners (12.9%) back the firm. Citi, Jefferies and RBC Capital Markets are underwriters. It plans to list on the Nasdaq as “UPWK.” Read more.
• Osmotica Pharmaceuticals, a Bridgewater, NJ-based maker of extended-release neurology and women’s health drugs, plans to raise $125 million in an offering 8.3 million shares between $14 to $16. Avista Capital Partners (45.4%) backs the firm. Jefferies, Barclays, RBC Capital Markets and Wells Fargo Securities are It plans to list on the Nasdaq under the symbol “OSMT.” Read more.
• StoneCo, a São Paulo, Brazil-based online payment processor, filed for an $100 million IPO. It lost $27.2 million in 2017. Madrone Capital and Tiger Global back the firm. Goldman Sachs, J.P. Morgan, Citi, Itau BBA, Credit Suisse, Morgan Stanley, BofA Merrill Lynch, and BTG Pactual are underwriters. It plans to list on the Nasdaq as “STNE.” Read more.
• ShoreView sold Oklahoma City-based Milamar Coatings LLC, an Oklahoma City, Okla.-based provider of protective floor coatings, to VersaFlex Inc. Financial terms weren’t disclosed.
• Hologic agreed to acquire Focal Therapeutics, a Sunnyvale, Calif.-based medical device company, for $125 million. Focal Therapeutics had raised approximately $11.6 million in funding from investors including Okapi Venture Capital and Emergent Medical Partners.