Greetings from 30k feet, as I'm flying out to San Francisco to attend Fortune's 40 Under 40 party tonight and our sold-out Liquidity Event tomorrow. A few notes from the middle seat in coach (behind someone who reclined all of the way, because she's exhausted from her night of taunting puppies and yelling at babies):
• Finally: Pure Storage last night became the first VC-backed tech ‘unicorn’ to go public since Box did so way back in January (no, Fitbit doesn’t count because its private valuation was below $1b). The data storage business raised $425 million by pricing in the middle of its proposed range, giving it an initial market cap of $3.1 billion. That’s just a hair above the $3 billion post-money valuation Pure Storage got on its final private funding round, but company president David Hatfield says that there were no contingency plans based on falling below the private price.
“We didn’t have any hypothetical scenarios like that,” Hatfield told me this morning via phone (he was standing outside the NYSE). “We just wanted to go out and speak with investors and are pleased with the outcome. [Going public now] was just the next logical step for us in the journey, and we felt there is never a bad time for good companies to go out.”
He also argues that Pure Storage is confident it will receive a better public market reception than have Violin Memory and other “first generation” flash storage companies, which focused primary on speed. “We want to give the performance of flash with the simplicity of an Apple iPhone at a low cost.”
• Big move: Neil Sequeira is stepping down as a general partner with General Catalyst after 11 years with the firm (the past six in Silicon Valley), as first reported yesterday by the WSJ. A few additional notes:
(1) The timing makes sense, as General Catalyst is gearing up to raise its next fund in Q1 2016. (2) This isn’t a sudden move. Sequeira and GC have been speaking for at least six months about his future with the firm. One big issue has been that Sequeira has wanted to focus on smaller, earlier-stage deals, whereas GC has been moving a bit down the food-chain. Another is just about Sequeira wanting to be more involved in senior management, with two of GC’s three co-founders having remained far longer than even they originally anticipated. (3) As WSJ reported, Sequeira next year will begin trying to raise around $100 million for a fairly traditional sort of VC fund ($5 million, post-seed/Series A checks), and expect that he’ll hire at least a principal to join him. He also is expected to remain on several of his GC board seats, including Honest Company.
• Compare/contrast: When DuPont CEO Ellen Kullman announced her resignation on Monday afternoon, General Electric CEO Jeff Immelt must have swallowed pretty hard.
Just hours earlier, activist investor Nelson Peltz had disclosed that his investment firm, Trian Fund Management, had amassed a $2.5 billion stake in GE, making it one of the conglomerate’s largest shareholders. The same Nelson Peltz who Kullman had battled for two years, successfully beating back his proxy challenge but, as we learned yesterday, ultimately losing the war. Gulp.
Immelt publicly welcomed Peltz, perhaps heartened by the activist’s lack of any requests for board seats and general endorsement of GE’s current strategy. But the reality is that his performance atop GE has been worse than was Kullman’s at DuPont (in terms of stock price, EBITDA, profits and revenie). If she was ultimately ousted, what does that mean for Immelt’s future at GE? For the Immelt vs. Kullman data breakdown, please go here.
THE BIG DEAL
• Meituan.com, China’s version of Groupon, is in merger talks with Chinese restaurant review site Dianping Holdings Ltd., according to the WSJ. The combined company could be worth more than $15 billion.
Meituan has raised over $1 billion in VC funding from firms like Alibaba and Sequoia Capital China. Dianping also has raised more than $1 billion, from firms like Sequoia, Tencent, Lightspeed Venture Partners, Google Ventures, FountainVest Partners and Qiming Venture Partners. Read more.
VENTURE CAPITAL DEALS
• AppDirect, a San Francisco-based provider of cloud service commerce solutions, has raised $140 million in new VC funding. J.P. Morgan led the round, and was joined by return backers Mithril Capital Management, Foiundry Group, StarVest Partners and iNovia Capital. Read more.
• Impossible Foods, a Redwood City, Calif.-based developer of meats and cheeses from plants, has raised $108 million in Series D funding. UBS led the round, and was joined by Viking Global Investors and return backers Horizons Ventures, Khosla Ventures and Bill Gates. Read more.
• CareSync, a Tampa, Fla.-based provider of software and services for chronic disease management, has raised $18 million in Series B funding. Merck Global Health Innovation Fund, Greycroft Partners and Harbert Venture Partners were joined by return backers Tullis Health Investors, Clearwell Group, CDH Solutions and Travis Bond. www.caresync.com
• Tado, a German maker of smart thermostats, has raised $17.1 million in new VC funding. Backers include Siemens AG, Statkraft Venture Capital and return backers Target Partners, Shortcut Ventures and BayBG. Read more.
• Binary Fountain, a McLean, Va.-based provider of health care reputation management and patient experience analytics, has raised $16 million in Series A funding. HLM Venture Partners led the round, and was joined by return backers Providence Health & Services and Pioneer Venture Partners. www.binaryfountain.com
• Quartet Medicine, a Cambridge, Mass.-based developer of treatments for chronic pain and inflammation, has raised $6.25 million in new Series A funding (round total is now $23.25m). Backers include Atlas Venture, Novartis Venture Funds, Partners Innovation Fund, Pfizer Venture Investments, Remeditex and two undisclosed Shanghai-based strategic investors. www.quartetmedicine.com
• Skurt, a Los Angeles-based on-demand rental car delivery service, has raised $1.3 million in seed funding led by Upfront Ventures. Read more.
PRIVATE EQUITY DEALS
• 3M (NYSE: MMM) has sold the assets of its North American Library Systems business to One Equity Partners. 3M also has agreed to sell the rest of its global Library Systems business to OEP. No financial terms were disclosed. www.3m.com
• BC Partners, Bridgepoint and Charterhouse Capital Partners are among those bidding to purchase French pharma company Cooper from private equity firm Caravelle, according to Bloomberg. Asale could be worth around €700 million. Read more.
• Hastings Equity Partners has acquired Hybrid Tool Solutions LLC, a Lindsay, Okla.-based provider of a process for conducting frac plug drill outs. No financial terms were disclosed. www.hastingsequity.com
• Opus Agency, a Beaverton, Ore.-based corporate events and experiential marketing agency, has raised an undisclosed amount of private equity funding from Fan Creek Capital. www.opusagency.com
• Salt Creek Capital has acquired Garrison Manufacturing Inc., a Santa Ana, Calif.-based manufacturer of hydraulic cylinders, valves and related components. No financial terms were disclosed. www.garrisonmfg.com
• TSG Capital Partners has agreed to sell its majority stake in Stumptown Coffee Roasters, a Portland, Ore.-based roaster credited with popularizing cold-brewed coffee, to Peet’s Coffee & Tea, an Emeryville, Calif.-based portfolio company of Donata Holding and BDT Capital Partners. Read more.
• Aclaris Therapeutics Inc., a Malvern, Penn.-based developer of dermatological therapeutics, raised $55 million in its IPO. The pre-revenue company priced 5 million shares at $11 per share (below $14-$16 range), for an initial market cap of around $213 million. It will trade on the Nasdaq under ticker symbol ACRS, while Jefferies and Citigroup served as lead underwriters. Aclaris has raised $31.5 million in VC funding from Vivo Ventures (31.2% pre-IPO stake), Fidelity Biosciences (28.5%) and Sofinova Ventures (12%). www.aclaristx.com
• Digicel, a Jamaica-based provider of telecom solutions in the Caribbean and South Pacific regions, has postponed an IPO that could have raised upwards of $1.8 billion. It had planned to trade on the NYSE under ticker symbol DCEL, with J.P. Morgan, UBS and Citigroup serving as lead underwriters. Read more.
• Pure Storage, a Mountain View, Calif.-based data storage company, raised $425 million in its IPO. The company priced 25 million shares at $17 per share (middle of $16-$18 range), for an initial market cap of around $3.1 billion. It will trade on the NYSE under ticker symbol PSTG, while Morgan Stanley served as left lead underwriter. Pure Storage reports a $113 million net loss on $159 million in revenue for the first half of 2015, compared to a $95 million net loss on $59 million in revenue for the year-earlier period. The company has raised more than $530 million in VC funding, and most recently was valued north of $3 billion. Shareholders include Sutter Hill Partners (27.4% pre-IPO stake), Greylock (17.3%) and Redpoint Ventures (5.7%). www.purestorage.com
• Hepalink USA Inc., a subsidiary of Shenzhen Hepalink Pharmaceutical Co. (SZSE: 002399), has acquired Cytovance Biologics Inc., an Oklahoma City-based biopharma contract development manufacturing company, from Great Point Partners for $205.68 million in cash. www.cytovance.com
• Anheuser-Busch InBev has increased its takeover offer for SABMiller (LSE: SAB) to £42.15 per share (16% premium to yesterday’s closing price), after two prior offers were rejected. If it were accepted, the $104 billion merger would create the world’s largest brewer. Read more.
• Diageo (LSE: DGE) and Heineken (Amsterdam: HEIA) have agreed to a beer asset swap whereby Diageo will receive $780.5 million in cash plus Heneken’s stake in an Ghana-based brewer, while Heineken will get Diageo’s U.S. distribution rights to Red Stripe. Read more.
FIRMS & FUNDS
• Bain Capital said that it would wind down its Absolute Return Fund hedge fund. Read more.
• Flag Capital (recently acquired by Aberdeen Asset Management) has closed its sixth private equity fund-of-funds with $295 million in capital commitments.
• Five Arrows Principal Investments, the private equity arm of Rothschild Merchant Banking, has closed its second European lower mid-market fund with €775 million in capital commitments. www.rothschild.com
• Warburg Pincus has secured $12 billion for its twelfth flagship private equity fund, according to Bloomberg. A final close is expected to occur in late November. Read more.
MOVING IN, UP, ON & OUT
• Jere Doyle has joined Sigma Prime Ventures as a managing director. He previously founded Oyster Angel Fund and, before that, was founder and CEO of Prospectiv (acquired by Affinion). www.sigmaprime.com
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