Hello, Erin Griffith here filling in while Dan is on vacation.
• The $100 million year: When we put a unicorn on the cover of Fortune in January, I thought it’d be the beginning of the end. (Plenty of comparisons were drawn to the 2007 cover story crowning Blackstone’s Steve Schwarzman “The New King of Wall Street” just before the credit crunch set in, with the financial crisis following shortly thereafter.) But things have only gotten crazier in the six months following “The Age of Unicorns.”
At this point, startup funding announcements are coming in so fast and furious that anything under $30 million feels like small potatoes. Then there’s the story I wrote a few months ago on rise of the “one-on-one” deal, where startups ask investors for $100 million on a $1 billion valuation.
Today CB Insights verified that anecdotal story with some hard evidence. This year, more than 100 startups have raised funding rounds above $100 million globally, the data service reports. More than 60 of those happened in the second quarter alone. Not all of those deals are “one-on-one” deals, though: Only 24 of the 61 deals in Q2 carried $1 billion or higher valuations. And only 12 of those were in North America. Still, US fundraising is on track to break records. If we keep going at this pace, venture funding in the US will top $70 billion this year, handily beating last year’s already-high $56.4 billion.
• Some reader feedback on yesterday’s column about mobile advertising:
Native advertising will save us all: “The slowness of brand ad dollars to move to the web is largely because the ad formats have sucked. Native formats and now, even more powerfully, video formats are allowing brand marketers to build creative content that resonates strongly with consumers, driving brand awareness and recall in ways that mirror television advertising.”
Eyeballs are nice but money is better: “There’s a reason there’s no line on the balance sheet or income statement for “eyeballs.” Not all eyeballs are created equal. Advertisers don’t care how many eyeballs are exposed to their ads, they care about how much revenue they generate per dollar spent on advertising. Of course, this is not easy to figure out and obviously takes time. Ms. Sandberg may ultimately be right about advertisers seeing the value of Facebook, but it won’t be because of the raw numbers of viewers. It will be because of the number of viewers who buy an advertiser’s stuff.”
On top of everything else: Mobile advertising has the same fraud problem as desktop. My colleague Mathew Ingram has a story out on that today.
• Some reader feedback on “valuation as defense”:
From a CEO: At the early stage, the founder and VC should be well-aligned. If a VC on the Board with a market pulse and full information rights votes for taking the offer, maybe the founder should re-evaluate how large the business could really be under their execution.
From an investment banker-turned-biz dev exec: No acquirer will base an offer on what the last round was. They may note it in trying to take a read of the situation, but value is based on what the market-clearing price is and how that relates to objective measures of valuation and future value. Founders seeking the highest valuation are doing it for ego, and they better not have a mis-step in execution or market development.
From a VC: The entrepreneur pointing to high valuations to fend off an acqui-hire statement is about as believable as the idea that VCs never pressure portfolio company to take or not take an exit. All sides deserve a cordial clap for their efforts….but come on people, don’t feign such universally altruistic positions.
From Hunter Walk, a VC who responded publicly on Twitter: That’s the craziest argument. A high IRR but small monetary return sucks. A VC would never pressure a seed startup into an acqui-hire unless it was on brink of failure. VCs have to grin & hold tongue when founders sell early.
From Trace Cohen, a founder who responded publicly on Twitter: Playing defense on valuation can make sense, but there are so few acquisition offers that you should take it seriously. Usually ego/greed/money decide.
Thanks for reading this week, Term Sheet readers (Term Sheeters?). Cyrus Sanati is taking over tomorrow and next week. I’ll be back next Friday for one more edition before Dan returns. Until then, send your deal announcements to Cyrus here: firstname.lastname@example.org.
THE BIG DEAL
• SGN, a San Francisco-based mobile game developer, raised $130 million in new investment from South Korean mobile gaming company Netmarble Games. SGN had previously $28 million in funding. Read more.
VENTURE CAPITAL DEALS
• Giosis, the Singapore-based operator of e-commerce company Qoo10, has raised $82.1 million in Series A funding led by Singapore Press Holdings. Participants include Saban Capital Group, UVM 2 Venture Investments, Brookside Capital, and Oak Investment Partners, a well as existing shareholder Ebay, which invested through a joint venture with Korean shopping site Gmarket. www.qoo10.com/
• Remedy Partners, a Darien, Conn.-based developer of insurance payment programs, has raised $50 million in Series B funding from Bain Capital Ventures. www.remedypartners.com/
• Ginkgo Bioworks, a Boston-based pharmaceutical production company, has raised $45 million in funding led by Viking Global, along with previous investors OS Fund, Y Combinator, and Felicis Ventures. The deal marks Y Combinator’s first Series B investment in an incubated company. Read more.
• Gynesonics, Redwood, Calif.-based women’s healthcare company, raised $43 million in financing co-led by Endeavour Vision and Abingworth. HealthCrest, InterWest Partners, Advanced Technology Ventures, HBM Partners, Correlation Ventures and Hercules Technology Growth Capital participated. gynesonics.com/
• Bima, Stockholm-based provider of insurance in the emerging markets, has raised $38.4 million in funding from Investment AB Kinnevik, LeapFrog Investments, Digicel Group and Millicom. www.bimamobile.com/
• Continuum Analytics, an Austin, Texas-based developer of the Anaconda analytics platform, has raised $24 million in Series A funding led by General Catalyst Partners with participation from BuildGroup. continuum.io/
• Cazena, Waltham, Mass.-based big data startup, has raised $20 million in Series B funding led by Formation8 with participation from Andreessen Horowitz and North Bridge Venture Partners. www.cazena.com/
• Leadspace, a San Francisco-based marketing software maker, has raised $18 million in new venture funding led by Battery Ventures, bringing its total to $35 million. Read more.
• SmarterHQ, an Indianapolis, Ind.-based retail market startup, raised $8 million funding led by Simon Venture Group with participation from Battery Ventures and angel investors. SmarterHQ.com
• Fishbrain, a Swedish social network for fishermen and women, has raised $8 million in venture funding from Northzone with participation from Industrifonden, Active Venture Partners, GP Bullhound, Edastra Venture Capital, Recruit Strategic Partners, and Novel TMT Ventures. www.fishbrain.com/
• ContinuumRx, Birmingham, Ala.-based provider of health care services, has raised $5.5 million in from NewSpring Health Capital. www.ContinuumRx.com
• VentureApp, a Boston-based on-demand service for startups, has raised $2 million out of a $2.5 million seed round led by Accomplice, with participation from Boston Seed Capital, Fullstack Ventures and a long list of angel investors. www.ventureapp.com
• Events.com, a San Diego, Calif.-based event management platform, has raised an undisclosed amount of funding led by Arctaris, with participation from led the La Jolla Holding Co. and Moore Venture Partners. This funding puts the company’s total at $17 million. www.events.com
• Terbium Labs, a Baltimore-based cyber security startup, has raised $3.7 million in funding from an undisclosed group of investors. terbiumlabs.com/
• SalesWarp, a Baltimore-based e-commerce company, has raised $3.2 million in a $4 million round of funding from an undisclosed group of investors. www.saleswarp.com/
• Peloton Technology, a Silicon Valley-based developer of vehicle safety systems, announced an investment of undisclosed size by Nokia Growth Partners. The company previously raised a $17 million Series A round of funding from Magna International, Castrol innoVentures, Volvo Group Venture Capital, UPS Strategic Enterprise Fund, Birchmere Ventures, Sand Hill Angels, and Band of Angels. www.peloton-tech.com/
• Clover, a Toronto-based dating app, raised $2 million in led by Social Starts with participation from angel investors. www.clover.co
• MyEye, a UK-based video livestreaming startup, has raised approximately £2 million from investors including soccer star David Beckham, according to TechCrunch. www.myeye.world/
PRIVATE EQUITY DEALS
• Raben Holdings, an Evansville, Ind.-based provider of agricultural tires, has acquired the assets of Coogle Tire Service in Otterbein, Indiana. Raben Holdings is backed by Palladium Equity Partners. http://www.rabentire.com/
• Ardian, a private investment company based in Frankfort, will acquire the based in Linz, Austria-based exclusive synthesis and maleic anhydride intermediates & specialties business activities of DPx Holdings B.V. The deal value was not disclosed. www.dpxholdings.com
• Berkshire Hathaway’s planned takeover of Duracell batteries from Procter & Gamble has been approved by the European Commission. The deal is worth $4.7 billion. www.duracell.com/
• Alion Science and Technology Corporation, a McLean, Va.-based defense contractor, has agreed to sell to Veritas Capital for an undisclosed amount. www.alionscience.com/
• KKR and Borealis Maritime have formed a joint venture to acquire today Hanseatic Ship Asset Management, a Hamburg, Germany-based fleet of container and dry cargo vessels which is a subsidiary of Commerzbank AG, for $254.5 million. borealismaritime.com
• UPS has held acquisition talks to acquire Coyote Logistics, a Chicago-based logistics company, for $1.8 billion, Reuters reported. Coyote Logistics is backed by Warburg Pincus. www.coyote.com/
• Banker’s Toolbox, Inc., a provider of compliance and fraud prevention tools, has sold a stake on undisclosed size to Accel-KKR. www.bankerstoolbox.com/
• Volkswagen is nearing a sale on 50% of its financial services arm, LeasePlan, Reuters reported. One potential buyer is a bidding consortium made up of Abu Dhabi Investment Authority, Singapore’s Government Investment Corporation, TDR Capital. www.leaseplan.com/
• El San Juan Resort & Casino, a Puerto Rico-based hotel property, has sold to Fundamental Advisors LP, Aimbridge Hospitality and Leon, Mayer & Co for an undisclosed amount. The company was owned by Blackstone Group’s Hilton Worldwide. hiltonworldwide.com
• DBV Technologies, a Paris-based biotech company, closed a follow-on public offering on Nasdaq, grossing $281.5 million. Investors in the company include Baker Brothers, Janus, Alliance Bernstein, Fidelity, Jennison, Oppenheimer Funds, Deerfield, Visium, Perceptive Advisors, and Venrock. www.dbv-technologies.com/
• Fiat Chrysler Automobiles has filed to spin off 10% of its stake in Ferrari in an IPO in New York later this year. Terms of the offering were not set. UBS, BofA Merrill Lynch and Santander will act as the underwriters. www.ferrari.com/en_us/
• China International Capital Corp has filed for an IPO in Hong Kong, Reuters reported. The offering, set to take place as soon as September, could be worth as much as $1 billion. Read more.
• Home Depot has agreed to acquire Interline Brands, a Jacksonville, Fla.-based facilities maintenance and repair services company, for $1.63 billion. Interline Brands is owned by Goldman Sachs Capital Partners and P2 Capital Partners LLC. Read more.
• DotLoop, a Cincinnatti, Ohio-based real estate paperwork startup, sold to Zillow for an undisclosed amount. The company had raised $9.7 million in venture funding from Trinity Ventures and angel investors. www.dotloop.com/
• Wal-Mart has acquired the final outstanding shares of Chinese e-commerce company Yihaodian. Wal-Mart invested in the company in 2011 and had previously boosted its stake in the company in 2012, when it took a 51% majority control position. Terms of the latest acquisition weren’t disclosed. Read more.
• The E.W. Scripps Company, has acquired Midroll Media, a bootstrapped Los Angeles-based company that creates original podcasts and sells ads for more than 200 other podcasts, including Gimlet Media’s “StartUp.” www.midroll.com/
• Cisco has announced plans to sell its customer-premises equipment business to Paris-based Technicolor for $600 million, the companies said. Read more.
• Pearson said it sold the Financial Times to Nikkei, a Japanese Financial newspaper, for $1.29 billion. Read more.
• Accenture has acquired Chaotic Moon Studios, an Austin, Texas-based digital services studio, for an undisclosed amount. www.chaoticmoon.com/
• Health insurance company Anthem is set to announce its deal to acquire competitor Cigna in a deal that will be worth $48 billion, Reuters reported. Read more.
• Toshiba Corp has sold a 4.6 percent stake Kone Oyj, a Finnish elevator company, for $945.6 million. www.toshiba.com/tai/
• HSBC is planning to sell its Turkish business to ING Group for between $700 million-$750 million, Reuters reported. Read more.
FIRMS & FUNDS
• DCM Ventures, a Menlo Park, Calif.-based venture capital firm, closed its second Android-focused investment fund, “A-Fund II.” with $100 million in capital commitments. http://www.dcm.com/
MOVING IN, UP, ON & OUT
• Tom Loucas and Linda Pratka have joined FocusPoint Private Capital Group in New York. Loucas previously worked at Barclays’ Wealth and Investment Management Group. Pratka was previously head of investor relations at Freeman Spogli, & Co.
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