Greetings from the home office, where I’m getting resettled after returning from the West Coast. Some notes to kick off our Monday:
• New fund alert: Gauge Capital has closed its debut fund with $250 million in capital commitments. This is the Dallas-based private equity firm formed last year by Drew Johnson (co-founder and ex-managing partner of CIC Partners) and Tom McKelvey (ex-Symphony Technology Group). It had begun fundraising this past April with a $175 million target and Harken Capital as placement agent.
• Coming attractions: Business lending platform OnDeck Capital still hasn’t publicly filed for an IPO, but a source familiar with the situation said it wouldn’t be a shock if OnDeck actually prices its offering before rival LendingClub, which filed its S-1 in late August. In broader IPO news, there are four companies expected to price offerings this week, including Boot Barn and Sientra.
• Thinking aloud: Last summer during the Fortune Brainstorm Tech conference in Aspen, I spent some time chatting with Uber CEO Travis Kalanick about who might make a serious acquisition run at his company. I suggested Hertz, to which he smiled and said something along the lines of “too small” (that proved prescient, as Hertz is currently valued at *only* $9.75 billion). Then I mentioned Google, to which he smiled a bit wider, and said “At least they could afford it.” Two days later, word came that Google Ventures had led a massive new investment in Uber (alongside TPG) at around a $3.5 billion valuation (a subsequent round, led by Fidelity, valued Uber at $18 billion).
The pairing made perfect sense. Google got access to the country’s hottest data-driven consumer startup, and Uber got hundreds of millions of dollars, an experienced big company director and a tacit guarantee that rival Lyft wouldn’t be able to tap the Bank of Mountain View.
But here’s what I’m beginning to wonder: Are the two companies on an eventual collision course? Everyone seems to agree that Uber’s future is on-demand delivery, with “rides” simply being a cornerstone product. It already has built out the infrastructure, and has doing trial runs of other products in various markets (i.e., flu shots in Boston last week). Google, of course, also appears to have interest in on-demand delivery, given its recent grocery roll-outs.
Let’s assume both companies want to move forward with such plans. The obvious solution would be for Google ($370b market cap, $60b in cash) to simply buy Uber. Only problem here is I can’t imagine Kalanick selling. Not the sort who wants a boss, even if that boss promises to be hands-off. So that leads us to the two companies competing, despite the investment. And this is where it could get a bit ugly, particularly given that Google would still control the main search function for many of the goods Uber would be seeking to deliver. Again, this is way down the road – and possibly mitigated by Google passing on the opportunity or the two sides forging some commercial deal – but it’s the sort of thing that can happen when a strategic investment works out too well for both sides.
• Speaking of Uber (or AirBNB): Data provider CB Insights reports that on-demand mobile services companies (i.e., Uber For X) have raised $1.46 billion in VC funding over the past year (not including Uber). Moreover, typical Series A rounds for such companies are 38% larger than other Series A rounds for mobile startups.
• Quiz Time: Last week there was a WSJ report that AirBNB was prepping a third-party tender for around $50 million of employee shares at a $13 billion valuation. Can you name the other 'unicorn' working on a similar sort of deal? Like AirBNB, it has a track record of not letting employees sell openly on the secondary market.
• Just a reminder that Fortune offers two other 'sheets' each morning. The first is Broadsheet, focused on the world's most powerful women. Sign up here. The second is Data Sheet, which focuses on the enterprise tech space. Sign up here. I promise that both are great morning reads.
THE BIG DEAL
• Hewlett-Packard Co. (NYSE: HPQ) is seeking a buyer for at least 51% of its Chinese corporate-networking business (H3C Technologies Co.), according to the WSJ. The unit could be valued at around $5 billion, with HP reportedly having already reached out to private equity firms. Read more.
VENTURE CAPITAL DEALS
• Syros Pharmaceuticals, a Watertown, Mass.-based developer of gene control therapies for cancer and other diseases, has raised $53 million in Series B funding. Polaris Partners, Aisling Capital and Redmile Group were joined by return backers Flagship Ventures, ARCH Venture Partners, WuXi PharmaTech Corporate Venture Fund and Alexandria Venture Investments. www.syros.com
• WeSwap, a London-based currency exchange company focused on pre-travel exchanges, has raised $7.5 million in Series A funding. IW Capital led the round, and was joined by EC1 Capital. www.weswap.com
• TaskEasy, a Salt Lake City-based provider of on-demand online ordering for home services like lawn-mowing and holiday-light installation, has raised $7 million in Series A funding. Participants include Grotech Ventures, Access Venture Partners and seed backer KickStart Seed Fund. www.taskeasy.com
• ExecOnline, a New York-based learning platform for business executives, has raised $5 million in Series A funding. Osage Venture Partners led the round, and was joined by New Atlantic Ventures, Kaplan Ventures and Militello Capital. www.execonline.com
• Wysada, a Jordan-based luxury online retailer of home goods, décor and interior furnishings for the Middle Eastern market, has raised over $5 million in Series A funding. Badia Impact Fund led the round, and was joined by new strategic investors from the Kingdom of Saudi Arabia and the Gulf Cooperation Council. www.wysada.com
• Oneflare, an Australian online marketplace for hiring local service professionals, has raised $1 million in seed funding from angels like Les Szekely (Equity Venture Partners), Garry Visontay (Sydney Seed Fund) and Jeffrey Tobias (The Strategy Group). www.oneflare.com.au
• Serraview, an Australian provider of workplace management and optimization software, has raised “several million dollars” in new VC funding led by Tamarisc LLC. www.serraview.com
PRIVATE EQUITY DEALS
• Abaco Energy Technologies LLC, a portfolio company of Riverstone Holdings, has agreed to acquire Basin Tools Inc., a Houston, Texas-based maker of rotors and stators used in mud-motor power sections. No financial terms were disclosed. www.riverstonellc.com
• Apax Partners and Bain Capital are among several private equity firms planning to bid for Portugal Telecom, which could be sold by Brazil’s Groupo Oi SA for around €7 billion, according to the FT. Read more.
• Centre Partners has acquired a majority stake in Stonewall Kitchen, a York, Maine-based specialty food producer and retailer. No financial terms were disclosed. www.stonewallkitchen.com
• Gryphon Investors has acquired a majority stake in C. B. Fleet Co., a Lynchburg, Va.-based maker of OTC personal healthcare products. www.cbfleet.com
• Metalmark Capital has acquired a majority stake in Collagen Matrix Inc., an Oakland, N.J.–based provider of technology used in tissue repair and regeneration. No financial terms were disclosed. www.collagenmatrix.com
• Angion Biomedica Corp., a Uniondale, N.Y.-based developer of therapeutics for treating acute and chronic organ injury, has withdrawn an IPO registration it had originally filed back in April, due to “unfavorable” market conditions. The company had planned to offer 2.7 million shares at between $10 and $12 per share, with Aegis Capital Corp. serving as underwriter. www.angion.com
• Chesapeake Oilfield Services, a well-site services provider being spin off from Chesapeake Energy Corp. (NYSE: CHK), has withdrawn plans for an $863 million IPO. No explanation was provided. The company planned to trade on the NYSE under ticker symbol COS, with Goldman Sachs and BoA Merrill Lynch serving as co-lead underwriters. The original IPO filing was made in April 2012.
• City Ventures Inc., a Newport Beach, Calif.-based homebuilder, has withdrawn a $150 million IPO registration it had originally filed in June 2013. No explanation was provided. It had planned to trade on the NYSE under ticker symbol CTYV, with Deutsche Bank and Goldman Sachs serving as lead underwriters. Shareholders include Ares Management and Imperial Capital Group. www.cvassets.com
• Coherus BioSciences Inc., a Redwood City, Calif.-based biologics platform company focused on biosimilars, has set its IPO terms to around 6.3 million shares being offered at between $12 and $15 per share. It would have an initial market cap of around $433 million, were it to price in the middle of its range. The company reports a $50.2 million net loss on $8.6 million in revenue for the first half of 2013. Coherus has raised around $100 million in VC funding, from firms like Lilly Ventures (11.17% pre-IPO stake), KKR (9.67%), Sofinnova Ventures (8.28%), Venrock (7.65%), RA Capital Management, Rock Springs Capital, Fidelity Biosciences and Vivo Capital. www.coherus.com
• First Guaranty Bancshare Inc., a Hammond, La.-based commercial bank that currently trades on the OTC, has filed for a $75 million IPO. It plans to trade on the Nasdaq under ticker symbol FGBI, with Raymond James serving as sole underwriter. www.fgb.net
• Freshpet Inc., a Seacaucus, N.J.-based provider of refrigerated pet foods, has set its IPO terms to around 10.42 million shares being offered at between $12 and $14 per share. It would have an initial market cap of around $413 million, were it to price in the middle of its range. The company plane to trade on the Nasdaq under ticker symbol FRPT, with Goldman Sachs and Credit Suisse serving as lead underwriters. It reports an $11 million net loss on nearly $40 million in revenue for the first half of 2014, compared to a $10 million net loss on nearly $29 million in revenue for the year-earlier period. Shareholders include MidOcean Partners and Tyson Foods. www.freshpet.com
• Nevro Corp., a Menlo Park, Calif.-based maker of medical devices to treat chronic pain and other neurological disorders, has set its IPO terms to around 6.25 million shares being offered at between $15 and $17 per share. It would have an initial market cap of around $365 million, were it to price in the middle of its range. The company plans to trade on the NYSE under ticker symbol NVRO, with J.P. Morgan and Morgan Stanley serving as lead underwriters. Nevro reports around a $14 million net loss on $14 million in revenue for the first half of 2014. It has raised around $106 million in VC funding, from firms like Johnson & Johnson Development Corp. (18.3% pre-IPO stake), Bay City Capital (13.4%), Three Arch Partners (13.4%), Novo AS (12%), AMV Partners (10.2%), Aberdare Ventures (9.8%), New Enterprise Associates (7.6%) and the Mayo Clinic. www.nevro.com
• Roku, a Saratoga, Calif.-based maker of a streaming entertainment device, is working with BofA Merrill Lynch and Citigroup on an IPO filing that could be designed to raise upwards of $150 million, according to the NY Times. Roku has raised over $130 million in VC funding from such firms as Menlo Ventures, Netflix, BSkyB, Fidelity, Hearst Ventures, Globespan Capital Partners, News Corp. and Luminari Capital. Read more.
• Cressey & Co. is seeking a buyer for Hospice Compassus Inc., a Brentwood, Tenn.-based hospice provider, according to Dow Jones. The deal could be valued at around $300 million. www.hospicecompassus.com
• Deezer, a Paris-based music streaming service, has acquired Stitcher, a San Francisco-based provider of personalized Internet talk radio. No financial terms were disclosed. Deezer has raised more than $140 million in funding from such firms as Access Industries, CM-CIC Capital Prive and IDInvest Partners. Stitcher had raised more than $18 million from New Enterprise Associates, Benchmark, New Atlantic Ventures and SV Angel. www.stitcher.com
• Nest Labs, a subsidiary of Google, has acquired Revolv, an Internet-of-things unification app. No financial terms were disclosed. Revolv had raised over $7 million in VC funding from Foundry Group, Libery Global, SK Ventures, American Family Insurance and Drummond Road Capital. www.revolv.com
• Kareo, an Irvine, Calif.-based provider of cloud-based medical office software for small medical practices, has secured $15 million in mezzanine debt from Escalate Capital Partners. www.kareo.com
• Natixis Global Asset Management has agreed to acquire NexGen Financial Corp. (TSX: NFX), a Toronto-based investment management firm, for approximately C$35 million. The C$7.25 per share purchase price represents a 107% premium to last Thursday’s closing price. www.nexgenfinancial.ca
• Newell Rubbermaid Inc. (NYSE: NWL) has acquired Bubba Brands Inc., an Atlanta–based maker of durable, on-the-go beverage containers. No financial terms were disclosed. Genesis Capital managed the process. www.bubbabrands.com
• Novartis AG (Swiss: NOVN) has agreed to sell its global influenza vaccine business to CSL Ltd. (ASX: CSL) for $275 million. Read more.
FIRMS & FUNDS
• Middle East Venture Partners has closed its first Lebanon-focused VC fund with more than $50 million in capital commitments. www.mevp.com
MOVING IN, UP, ON & OUT
• Frederick Antwi has joined TPG Capital to help develop an investment strategy for Africa, according to the WSJ. The Ghana-raised Antwi previously was a banker with Goldman Sachs. Read more.
• Antonia Cheong has joined UK-based private equity firm Bowmark Capital as an investment manager. She previously was an associate director with DC Advisory Partners. www.bowmark.com
• Meenal Devani has joined KKR as a London-based director of real estate investments. She previously spent more than seven years as an investment director with London & Regional Properties. www.kkr.com
• Alok Pandey has joined Vector Capital as a senior associate, with a focus on growth equity opportunities. He previously spent more than two years with Technology Crossover Ventures. www.vectorcapital.com
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