CryptocurrencyInvestingBanksReal Estate

Term Sheet — Tuesday, October 14

October 14, 2014, 2:00 PM UTC

Random Ramblings

“We did try, but it’s over now.”

That was IAC CEO Barry Diller talking about Aereo, less than an hour after the Supreme Court ruled in June that the controversial broadcast TV streaming company was running afoul of copyright law. Diller was among those that had plugged nearly $100 million into the Boston-based startup, including a $34 million Series C round this past January.

But here’s the thing: Neither Diller nor any of the company’s other investors have actually pulled the plug. No demands that the company cease operations, lay off staff or sell equipment. Instead, the company is still employing around 110 full-timers, although many of the sales and marketing folks have been given different tasks (per a company spokeswoman). It also had maintained all of the leases for warehouse facilities where its tiny antennae continue to sit, just waiting for the company to either reposition itself of win its next round of court cases (including one tomorrow in New York).

“There hasn’t been a new investment since the ruling, but we don’t think we’re throwing good money after bad by not closing up and moving on,” says Dan Nova, a partner with early Aereo investor Highland Capital Partners. “The ruling itself and the wording of the ruling created several Plan Bs that wasn’t necessarily there before, so we feel we have a number of cards still to turn over.”

One of those cards is via the legal system, while another is to formally ask the Federal Communications Commission to clarify its definition of “multichannel video programming distributors” to include video service providers “deliver to subscribers linear channels of video programming such as local, over-the-air broadcast programming.” Nova suggests that the company expects an answer from the FCC within three to six months, although acknowledges that the legal process could take longer. A third “card” would be to sell off Aereo’s technology but, to this point, that process has not been launched.

 Moving on: Todd Cater has quietly stepped down as a Washington, D.C.-based managing director with the Global Environment Fund, which he first joined back in early 2006. No word yet on his future plans.

 Electoral update: A number of VC and PE vets are running for office next month. Below is a quick rundown of where they currently stand, per Real Clear Politics poll averages: 

  • Gina Raimondo, a former partner with VC firm Point Judith Capital, is up by 4 points in her race for Rhode Island governor, vs. Republican nominee Allan Fung. 
  • Bruce Rauner, a former partner with GTCR, is trailing Democrat Pat Quinn by 2.7 points in the race for Illinois governor.
  • Mike McFadden, co-CEO of Lazard Middle Market (currently on leave of absence), is down by 11.5 points in his effort to unseat Sen. Al Franken (D) in Minnesota. 
  • Charlie Baker, who had a controversial cup of coffee as an executive-in-residence with VC firm General Catalyst, is trailing Democrat Martha Coakley by 1.6 points in the race for Massachusetts governor. 

 #GetLiquid: I'm looking forward to seeing more than 750 of you in one week from tonight in San Francisco, at our sold-out Liquidity Event. Big thanks to our sponsors, who foot the bill for our open bar and food trucks (since the ticket proceeds go to charity). Those sponsors are: Andreessen Horowitz, Gunderson Dettmer, NEA, Preqin and TriplePoint Capital. 


 Invitae Corp., a San Francisco-based company that plans to “bring genetic information into routine medical practice,” has raised $120 million in Series F funding. New investors include The Broe Group, Decheng Capital, Deerfield Management, OrbiMed, Perceptive Advisors, Rock Springs Capital and Wellington Management Company. Return backers include Casdin Capital, Genesys Capital, Genomic Health Inc., Randy Scott, Redmile Group and Thomas McNerney & Partners. J.P. Morgan Securities served as placement agent.



 Raze Therapeutics, a Cambridge, Mass.-based developer of a “new class of oncology therapeutics that target key metabolic pathways,” has raised $24 million in Series A funding. Investors include Atlas Venture, MPM Capital Management, MS Ventures, Partners Innovation Fund, Astellas Venture Management and Novartis.

 Bicycle Therapeutics, a UK-based developer of bicyclic peptides for new drug discovery, has raised £20 million in new VC funding. Return backers include , Atlas Venture, Novartis Venture Fund, SR One, SV Life Sciences and Astellas Venture Management.

 DNAtrix, a San Diego-based oncolytic immunotherapy company, has raised $20 million in Series B funding. Morningside Ventures led the round, and was joined by return backers like Mercury Fund and Targeted Technology Fund.

 Ozy Media, a Mountain View, Calif.-based online news site focused on “the change generation” audience, has raised $20 million in new VC funding from German publisher Axel Springer at around a $120 million valuation. Read more. 

 2nd Watch, a Seattle-based builder and manager of AWS-based IT operations for enterprise applications, has raised $10 million in new Series C funding. Top Tier Capital Partners led the round, and was joined by return backers Madrona Venture Group and Columbia Capital.  

 Rigontec GmbH, a German developer of RNA-based immunotherapeutics for the treatment of cancer and viral diseases, has raised €9.45 million in Series A funding. Wellington Partners and Boehringer Ingelheim Venture Fund co-led the round, and were joined by NRW Bank and High-Tech Gründerfonds.

 S2C Inc., a San Jose, Calif.–based developer of SoC/ASIC prototyping systems, has raised $4.6 million in Series C funding co-led by GVT Fund and Industrial Technology Investment Corp.

 Risk I/O, a Chicago-based vulnerability intelligence platform, has raised $4.5 million in new Series A funding, bringing the round total up to $10.5 million. Costanoa Venture Capital led the round, and was joined by fellow return backers USVP, Tugboat Ventures and Hyde Park Angels.

 Speakr (f.k.a. TwitMob), a Los Angeles-based platform that connects social influencers with brands, has raised $2.9 million in seed funding. Toba Capital led the round, and was joined by Allegro Venture Partners and individual angels like Comcast’s Ed Snider.

 Ecovent, a Boston-based maker of wireless vents and sensors for home heating and cooling systems, has raised $2.2 million in seed funding. Backers include Otter Consulting, Semyon Dukach (via Boston Syndicates), Stewart Alsop, Julia Austin, Will Herman, Warren Katz and Michael Mark.

 Magic Leap, a Florida-based developer of “cinematic reality” technology, is in talks to raise upwards of $500 million in funding from backers like Google and Andreessen Horowitz, according to Re/Code. Read more


 Accela, a San Ramon, Calif.-based provider of civic engagement solutions for government, has acquired Government Outreach, a Pleasanton, Calif.-based provider of citizen relationship management and code enforcement solutions. No financial terms were disclosed. Accela is a portfolio company of Bregal Sagemount.

 Alberta Investment Management Corp., Allianz Capital Partners and Hastings Funds Management have agreed to acquire Porterbrook Rail Finance Ltd., a UK-based rolling stock leasing company. No financial terms were disclosed.

 AssuredPartners, a Lake Mary, Fla.-based insurance brokerage platform owned by GTCR, has acquired Hukill Hazlett Harrington Agency, a Cincinnati-based business insurance agency. No financial terms were disclosed.

 Brentwood Associates has acquired a majority stake in Z Gallerie Inc., a Gardena, Calif.-based furniture retailer, according to Buyouts magazine. No financial terms were disclosed.

 Citadel Plastics Holdings, a provider of thermoplastic and engineered composite compounds, has agreed to acquire The Composites Group, a Highland Heights, Ohio–based manufacturer of engineered composite compounds, from Highlander Partners. No financial terms were disclosed. Citadel Plastics is a portfolio company of HGGC and Charlesbank Capital Partners.

 GTCR is in exclusive talks to acquire media monitoring company Gorkana Group from Exponent Private Equity, according to the WSJ. The deal could be valued at more than £150 million. Read more.

 Providence Equity Partners is in talks to acquire a majority stake in RentPath, a Norcross, Ga.–based real estate listings company, from TPG Capital, according to Reuters. Read more

 Uni-World Capital has acquired Drake Manufacturing Services Co., a Warren Ohio-based manufacturer of precision CNC machine tools. No financial terms were disclosed.

 Vista Equity Partners has acquired TransFirst, a Hauppauge, N.Y.-based payment processing company, from Welsh Carson Anderson & Stowe. No financial terms were disclosed, although earlier press reports suggested that the deal could be valued at around $1.5 billion (including assumed debt).


 No IPO news this morning...


 EMC Corp. (NYSE: EMC) has agreed to acquire Cloudscaling, a San Frasncisco-based provider of open-cloud infrastructure solutions. No financial terms were disclosed, but Bloomberg puts the price-tag at below $50 million. Cloudscaling has raised around $14 million in VC funding from such firms as Trinity Ventures, Juniper Networks and Seagate. Read more. 

 Janus Capital Group has agreed to acquire the parent company of VelocityShares, a New Canaan, Conn.-based developer and distributor of exchange-traded products, for at least $30 million. Sellers would include FTV Capital. Read more


 Becton Dickinson (NYSE: BDX) has acquired GenCell Biosystems, an Irish developer of tech solutions for biological analysis protocols. No financial terms were disclosed. Sellers include Enterprise Ireland.

 Delivery Hero, a Germany-based food delivery service with a large Latin American operation, has acquired Subdelivery, a Sao Paulo-based food delivery service that has an exclusive contract for offering Subway products in Brazil. Delivery Hero shareholders include Insight Venture Partners, Vostok Nafta and Kite Ventures.

 Geberit AG (Swiss: GEBN) has agreed to acquire Sanitec Corp. (Oslo: SNTC), a Finland-based maker of bathroom ceramics, for approximately $1.4 billion in cash.

 Iliad (Paris: ILD) said that it has ended its takeover pursuit of T-Mobile US (NYSE: TMUS). Read more

 Premium Point Investments has acquired a majority stake in Residential Capital Management, an Atlanta-based operator of single-family residential homes in the Southeastern U.S. No financial terms were disclosed.

 Steris Corp. (NYSE: STR) has offered to acquire Synergy Health (LSE:SYR), a UK-based provider of outsourced sterilization services for medical device manufacturers and hospitals, for approximately $1.9 billion in cash and stock.


 JPMorgan Chase & Co. reported Q3 profit of $5.6 billion, or $1.36 per share, compared to a $380 million loss for the year-earlier period. Read more

 MVision, a London-based private equity placement firm, has opened a San Francisco office. It will be led by Nick Wall, an MVision director who is relocating from New York.

 Osage University Partners, a Pennsylvania-based VC focused on startups that are commercializing university research, is raising upwards of $200 million for its second fund, according to a regulatory filing. It already has secured more than $151 million.


 Jean Châtillon has joined European private equity firm Silverfleet Capital as a Paris-based principal. He previously was with Cobalt Capital. Silverfleet also announced that Benjamin Hubner (ex-McKinsry & Co.) and Jennifer Regehr (ex- UniCredit Bank) have joined the firm as Munich-based associates.

 Abby Johnson has been named CEO of Fidelity Investments, succeeding her father Ned.  Johnson currently serves as president, a post she will retain while serving as CEO. Read more

 John Streur has agreed to join Calvert Investments, where he will take over as CEO on January 1, 2015. He currently is president of Portfolio 21, and will succeed Barbara Krumsiek.

 Erik Szyndlar has joined middle-market investment bank Harris Williams & Co. as a San Francisco-based vice president. He previously spent five years as a tech-focused vice president with Robert W. Baird.

 Garrett Vygantas has joined Chicago-based VC firm Jump Capital as a West Coast partner and head of healthcare investing. He previously was the founding CEO of NewBridge Pharmaceuticals, and also served as an entrepreneur-in-resident and investment director with Burrill Venture Group.

 Graham White has joined law firm Fried, Frank, Harris, Shriver & Jacobson LLP as a London-based partner and head of its European private equity practice. He previously was a senior partner in the London office of Kirkland & Ellis.

Share today's Term Sheet: