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Term Sheet — Friday, June 19

June 19, 2015, 2:10 PM UTC

Random Ramblings

Some quick Friday morning notes:

 Pao vs. Kleiner Perkins Part XVIIX!$@$: SF Superior Court Judge Harold Kahn yesterday ruled that Ellen Pao must pay nearly $267,000 to reimburse Kleiner Perkins Caufield & Byers for trial expenses, related to her suit against the VC firm for gender discrimination and retaliation. KPCB had originally asked for $973,000, but claims to be content with the result, saying that the ruling "recognizes the cost rules still apply when a plaintiff refuses a reasonable settlement offer and forces the parties to go through an expensive trial.”

This ruling does not affect Pao's ability to file an appeal, although there is still no indication on whether she intends to do so and, if so, upon what grounds. During an interview yesterday with Bloomberg TV, KPCB partner John Doerr said that the lawsuit left him feeling "sick" and "betrayed."

 Speaking of John Doerr: He is one of several new participants we recently announced for Fortune Brainstorm Tech, our sold-out gathering that takes place July 13-15 in Aspen. Other recent additions include (but are not limited to):

Susan Wojcicki (CEO of YouTube), Bill Maris (Google Ventures), James Park (CEO of Fitbit), Ari Emanuel (CEO of William Morris Endeavor), Nikesh Arora (vice chairman of SoftBank), Marc Brown (head of M&A at Microsoft), Jacqueline Reses (chief dev officer at Yahoo), Arlen Shenkman (head of corp dev at SAP), Helen Greiner (CEO of CyPhy Works), Kurt Graves (CEO of Intarcia Therapeutics), Jonathan Bush (CEO of Athenahealth), Stephanie Tilenius (CEO of Vida Health), Adam Miller (CEO of Cornerstone OnDemand), Blake Irving (CEO of GoDaddy), Mikken Svane (CEO of Zendesk), Julia Hartz (president of Eventbrite), Andrew Wilson (CEO of Electronic Arts), Kathy Savitt (CMO of Yahoo), Brad Feld (Foundry Group), Austin Geidt (head of expansion at Uber) and Sam Altman (president of Y Combinator).

 Speaking of lawsuits: Adam Levine and TPG Capital have shrugged their shoulders and made up, with the firm's former spokesman agreeing to drop a lawsuit that claimed TPG ignored his warnings that TPG may have violated securities regulations and defrauded investors out of millions of dollars. In return, TPG agreed to a permanent injunction to settle its prior lawsuit against Levine for allegedly leaking confidential firm documents to the media. TPG says that it did not make any payment to Levine in exchange for his complaint withdrawal. It remains unclear if the SEC is investigating Levine's claims independent of these court developments.

 GP for LP: While in Silicon Valley earlier this month, I interviewed Marc Andreessen as part of his venture firm's annual LP day. There is now an audio podcast available of that session, including Marc's discussion of how the financial crisis almost caused Facebook to raise money at a $3 billion valuation, despite having previously received a $15 billion mark from Microsoft. Go here for more.

 In case you missed it: Gretchen Morgenson had a fairly troubling piece in last Sunday's NY Times, related to private equity's use of outside attorneys and auditors. Specifically, she found evidence that many firms receive discounts from such outside service providers for work done for the general partnership (i.e., fund formation, etc.) but not for work done on behalf of the limited partnership (i.e., portfolio company work). The suggestion, of course, is that there's a bit of quid pro quo going on, with limited partners left holding the quo. If big PE firms are able to get volume discounts from outside vendors, then shouldn't more volume (i.e., portfolio company work) generate a larger discount across the board? If is the latter effectively subsidizing the former?

 Have a great Father's Day weekend...


 Namely, a New York-based HR software platform, has raised $45 million in Series C funding. Sequoia Capital led the round, and was joined by return backers Matrix Partners, True Ventures, Lerer Hippeau Ventures and Greenspring Global Partners.


 Tamr, a Cambridge, Mass.-based data cleansing startup, has raised $26.2 million in Series B funding. Backers include Hewlett-Packard Ventures, Thomson Reuters and MassMutual Ventures. Read more.

 Advanced Cell Diagnostics Inc., a Hayward, Calif.-based provider of situ nucleic acid detection for life science research and clinical diagnostics, has raised $22 million in Series C funding. Summit Partners led the round, and was joined by Kenson Ventures and return backers Morningside Ventures and New Leaf Venture Partners.

 Cryptzone, a Waltham, Mass.-based provider of context-aware network, application and content security solutions, has raised $15 million in Series B funding. Kayne Partners led the round, and was joined by return backer Medina Capital.

 Cure Forward, a Cambridge, Mass.-based “patient activation company,” has raised $15 million in Series A funding from Apple Tree Partners.

 Mayvenn, an Oakland, Calif.-based hair extension startup, has raised $10 million in new VC funding led by Andreessen Horowitz. Read more.

 Komprise, a San Francisco-based provider of data management software, has raised $6 million in Series A funding led by Canaan Partners.

 HR Path, a French IT consultancy and service provider for large HR information systems, has raised €5 million in new funding from Ardian and Societe Generale Capital Partenaires.

 Tava Indian Kitchen, a San Francisco-based fast casual Indian restaurant concept, has raised $4.5 million in Series A1 funding. Backers include CircleUp Growth Fund, Kensington Capital, Agilic Capital and HiGrowth Advisors., a San Francisco-based virtual nurse platform for patient engagement and chronic disease monitoring, has raised $2.2 million in Series A funding. Backers include Launchpad Digital Health, Fenox Venture Capital and TA Ventures.

 Volley, a Toronto-based online advice and feedback platform, has raised C$500,000 in seed funding from Version One Ventures.


American Securities has completed its previously-announced acquisition of Royal Adhesives and Sealants LLC, a South Bend, Ind.-based maker of adhesives and sealants, from Arsenal Capital Partners. No financial terms were disclosed.

CVC Capital Partners has agreed to acquire a 60% stake in Stage Entertainment, an international musical and theatre group. No financial terms were disclosed.

 KKR has sponsored a recapitalization of Drawbridge Realty, a San Francisco-based commercial real estate investment and development company with around $800 million in assets under management. No financial terms were disclosed.

 OMERS Private Equity has agreed to acquire The Kenan Advantage Group Inc., a North Canton, Ohio-based provider of liquid bulk transportation services, from Goldman Sachs Capital Partners and Centerbridge Partners. No financial terms were disclosed.

 Stone Point Capital and KKR are leading a recapitalization of Privilege Underwriters Inc., a White Plains, N.Y.–based provider of personal insurance and risk management services to high net worth individuals and families. No financial terms were disclosed.


 Celyad SA, a Belgium-based provider of cell therapy treatments with an initial focus on cardiology and oncology, raised $100 million in its IPO. The company priced 1.5 million shares at $68.56 (slight discount to where the company’s shares were trading on the Euronext). It will list on the Nasdaq under ticker symbol CYAD, while UBS and Piper Jaffray served as lead underwriters. The company's stock will continue to trade on both Euronext Brussels and Euronext Paris.

 Fogo de Chao, a Dallas-based Brazilian steakhouse chain operator owned by Thomas H. Lee Partners, raised $88 million in its IPO. The company priced 4.41 million shares at $20 per share (above $16-$18 range), for an initial market cap of approximately $545 million. It will trade on the Nasdaq under ticker symbol FOGO, while Jefferies and J.P. Morgan servd as co-lead underwriters. It reports $17.2 million in net income on $262 million in revenue for fiscal 2014.

 InnoLight Technology Corp., a Suzhou, China-based provider of cloud computing optical transceivers, has filed for a $100 million IPO. It plans to trade on the Nasdaq under ticker symbol INLT, with Credit Suisse and Barclays serving as lead underwriters. The company reports $11.28 million in net income on $121.5 million in revenue for 2014. The company raised a $38 million Series C funding round last fall from Google Capital (20.2% pre-IPO stake), Lightspeed China Partners (10.5%), Oriza Holdings (6.5%) and Acorn Campus (6.6%).

 MindBody Inc., a San Luis Obispo, Calif.-based online wellness marketplace, raised $100 million in its IPO. The company periced 7.15 million shares at $14 per share (middle of range), for an initial market cap of around $448 million. The company will trade on the Nasdaq under ticker symbol MB, while Morgan Stanley, Credit Suisse and UBS served as lead underwriters. MindBody reports a $24.6 million net loss on around $70 million in revenue for 2014, compared to a $16 million net loss on $49 million in revenue for 2013. Shareholders include Bessemer Venture Partners (20.3% pre-IPO stake), Catalyst Investors (15.5%), J.P. Morgan Digital Growth Fund (10.1%), Institutional Venture Partners (10%) and W Capital Partners (8.9%).

 Nabriva Therapeutics AG, an Austria-based developer of antibiotics to treat serious infections, has filed for a $92 million IPO. It plans to trade on the Nasdaq under ticker symbol NBRV, with Leerink Partners and RBC Capital Markets serving as lead underwriters. Shareholders include HBM Healthcare Investments (17.9% pre-IPO stake), Vivo Capital (17.8%), OrbiMed Advisors (16.1%), Phase4 Ventures (14.3%), The Wellcome Trust (11%), Global Life Sciences Ventures (8.3%), Hatteras Venture Partners, Tavistock Life Science, Kreos Capital and Novartis Ventures.

 Teladoc, a Dallas-based provider of 24/7 tele-health consultations, has set its IPO terms to 7 million shares being offered at between $15 sand $17 per share. It would have an initial market cap of around $573 million, were it to price in the middle of its range. The company plans to trade on the NYSE under ticker symbol TDOC, with JPMorgan and Deutsche Bank Securities serving as co-lead underwriters. The company reports a $12.7 million net loss on $16.5 million in revenue for Q1 2015. It has raised nearly $75 million in VC funding, from firms like Cardinal Partners, HLM Venture Partners, Kleiner Perkins Caufield and Byers, New Capital Partners, Trident Capital, Jafco Ventures, FLAG Capital Management, Greenspring Associates, Mellon and QuestMark Partners.


 New Mountain Capital is considering a sale of SNL Financial, a Charlottesville, Va.–based provider of financial news and data services, according to Bloomberg. The deal could be worth more than $1 billion. Read more.

 Wind Point Partners has hired Deutsche Bank and Macquarie Group to explore a sale of Novolex, a Hartsville, S.C.–based maker of paper and plastic packaging products, according to Reuters. A sale could value Novolex at around $1.75 billion. Read more.


 The British government has picked Goldman Sachs as its advisor on plans to privatize Royal Bank of Scotland and Lloyds Banking Group, raising questions about conflicts of interest, according to the FT. Read more.

 Fidelity has offered to acquire the 37.6% stake it doesn’t already own in British IT provider Colt Group (LSE: COLT), for around $2.7 billion in cash. Read more.

 General Motors (NYSE: GM) asked Goldman Sachs and Morgan Stanley for advice following public merger interest from Fiat Chrysler boss Sergio Marchionne, according to Reuters. GM CEO Mary Barra shot down the merger talk, but retaining the banks suggest that GM took the interest at least somewhat seriously. Read more.

 Sequential Brands (Nasdaq: SQBG) is nearing an agreement acquire Martha Stewart Living Omnimedia (NYSE: MSO), according to the WSJ. MSO had a market cap of $370 million prior to the WSJ report. Read more.


 Arboretum Ventures, an Ann Arbor, Mich.-based VC firm, is raising upwards of $215 million for its fourth fund, according to a regulatory filing.

 Fortress Investment Group has raised $1 billion for its new credit real estate fund.

 RezVen Partners, a Newport Beach, Calif.-based early-stage VC firm focused on software and digital and social media companies, has closed a new fund with $50 million in capital commitments.


 Bessemer Venture Partners has promoted Kristina Shen to vice president. The SpeakEasy co-founder joined BVP in 2013.

 Thomas Spoto has joined Goldman Sachs as a managing director. He previously was a managing director with AlpInvest Partners, focused on North American co-investments.

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