JAMIE DIMON VS. THE INTERNET: J.P. Morgan CEO Jamie Dimon lit the Internet on fire yesterday after his remarks about how Bitcoin is “a fraud” and how he would fire any employee trading bitcoin for being “stupid.”
At a CNBC/Institutional Investor Delivering Alpha conference, Dimon argued that governments will eventually crack down on digital currencies because cryptocurrency is being used for illicit purposes. This is not the first time he’s gone on a tirade about cryptocurrency. In 2015, Dimon attended Fortune’s Global Forum conference where he told attendees, “You’re wasting your time” with Bitcoin.
This is only interesting (and perplexing) because:
• Dimon’s company was one of 86 corporate firms to play a role in forming The Enterprise Ethereum Alliance, an open-source blockchain initiative. The idea of the EEA is for big banks and tech companies to come together and build business-ready versions of the software behind Ethereum, a decentralized computing network based on digital currency.
• At yesterday’s conference, Dimon was careful to distinguish between cryptocurrencies and the blockchain because, well, J.P. Morgan has actually built its own blockchain on top of Ethereum.
• Remember when J.P. Morgan tried to patent a Bitcoin-style payment system? Although the patent was reportedly rejected, it’s fascinating to see the bank lay out some of the problems with the existing payment structure. For instance, “Furthermore, to date, there is no efficient way for consumers to make payments to other consumers using the Internet. All traditional forms of person-to-person exchange include the physical exchange of cash or checks rather than a real-time digital exchange of value. In addition, the high cost of retail wire transfers (i.e., Western Union) is cost prohibitive to a significant portion of society.” In 2014, Dimon told CNBC that Bitcoin is “a terrible store of value. It could be replicated over and over." Unfortunately for J.P. Morgan, it didn’t quite work out.
• My favorite twist to all of this is that while Dimon was bashing Bitcoin, J.P. Morgan’s Chief Economist Michael Vaknin was hosting panelists from Blockchain Capital, Pantera Capital, Boost VC, and Polychain Capital. Not awkward AT ALL. J.P. Morgan’s own blockchain program lead tweeted a ¯\_(ツ)_/¯ in response to Dimon’s comments. And JPM’s former global trading macro head offered the less politically-correct, “Jamie, you're a great boss and the GOAT bank CEO. You're not a trader or tech entrepreneur. Please, STFU about trading $BTC.”
Taking the drama up another notch, Social Capital CEO Chamath Palihapitiya spoke at the same conference and immediately refuted Dimon’s earlier remarks. He said “the genie is fundamentally out of the bottle,” adding that he’s been “massively long Bitcoin” since 2012-13.
To wrap this up, I’ll leave you with a few thoughts. I do think Bitcoin and other cryptocurrencies have the potential to fundamentally reshape global finance. And unfortunately, many will undoubtedly get burned along the way as a result of entrepreneurs/investors who abuse the lack of regulations around ICOs. As Peter Smith, the CEO of Blockchain, said at Fortune’s Brainstorm Tech conference in July, “We’re cautious about it in the short term. But you have to temper that with the idea that every new technology is going to be like that in the beginning.”
UNICORN ALERT: Rubicon Global, the “Uber for trash,” just joined the unicorn club. The Atlanta-based startup received $50 million in a strategic investment from Mexican private equity firm Promecap, valuing the company at $1 billion. After Forbes published the story, I called CEO Nate Morris to better understand the fundraise. Here’s what I learned:
• Although this Form D states the company has $19.4 million in committed capital, Morris told me the company is actually raising $100 million in two $50M tranches, with the first round closed.
• The additional $50M will come from strategic investors at a higher valuation. It’s expected to close in late October or early November.
• I asked about how close the company is to profitability and Morris told me, “This will be the last round of capital we raise until we take the next step as a company.”
• Morris declined to say whether the company is considering an IPO in the near future, but he said he wants to “build a company in a way that has the option to IPO.” Hm.
This is an interesting company to keep an eye on …. I’ll have more on this tomorrow.
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• Nasuni, a Natick, Mass.-based provider of cloud-scale enterprise file services, raised $38 million in funding. Goldman Sachs Growth Equity led the round.
• Skywire Networks, a New York City-based fixed wireless broadband provider, raised $23 million in funding from Metropolitan Partners Group.
• Aria Systems, a San Francisco-based cloud platform for billing and managing recurring revenues, raised $18 million in funding. Madison Bay Capital led the round, and was joined by investors including Hummer Winblad Venture Partners, InterWest Partners, and Venrock.
• DNA Script, a Paris-based synthetic DNA manufacturer, raised 11 million euro ($13.1 million) in Series A funding. Investors include Sofinnova Partners, Kurma Partners, Idinvest Partners, Illumina Ventures and Merck Ventures BV.
• Cheetah Medical, a Newton, Mass.-based provider of non-invasive hemodynamic monitoring, raised $11.76 million in funding. Investors include MVM Life Science Partners, Springfield Investment Management, Fletcher Spaght Ventures, HighCape Partners and Robert Bosch Venture Capital.
• OYO, an India-based budget hotel startup, raised $10 million in funding from China Lodging, according to TechCrunch. Read more.
• Bossa Studios, a U.K.-based games maker, raised $10 million in funding, according to Reuters. Atomico led the round. Read more.
• Credly, a New York-based digital credential platform, raised $4.6 million in new funding. Investors include New Markets Venture Partners, University Ventures, Lumina Foundation, City & Guilds Group, and Lion Brothers.
• Happy Returns, a Los Angeles-based provider of a nationwide network of in-person return for points commerce and retail companies, raised $4 million in Series A funding. Upfront Ventures led the round, and was joined by investors including Lowercase Capital and Brian Spaly.
• Cybrary, a Greenbelt, Md.-based cybersecurity training course provider, raised $3.5 million in Series A funding. Arthur Ventures led the round.
• Camera IQ, a Santa Monica, Calif.-based camera experience manager, raised $2.3 million in seed funding. Shasta Ventures led the round, and was joined by investors including Presence Capital, Greycroft Tracker Fund, Brilliant Ventures and Act One.
• Moteefe, a London-based social commerce platform, raised $2.2 million in seed funding. Investors include Charles Songhurst, Livingbridge, Force Over Mass Capital, Fuel Ventures and Ascension Ventures.
• Machfu, a Germantown, Md.-based IoT startup, raised $1.6 million in funding. Blu Venture Investors led the round.
• MyndYou, an Israel-based company that uses artificial intelligence to aid clinicians in tracking and addressing cognitive decline among seniors, raised seed funding of an undisclosed amount. Howard Lee Morgan led the round, and was joined by investors including Musketeer Capital.
HEALTH AND LIFE SCIENCES DEALS
• Rani Therapeutics, a San Jose, Calif.-based company that helps convert injectable drugs into pills, raised $39 million in Series D funding. Investors include GV.
• Sophia Genetics, a Switzerland-based platform that analyzes patient genome sequence information and data, raised $30 million Series D funding. Investors include Balderton Capital and 360 Capital Partners.
• GreenLight Biosciences, Inc, a Medford, Mass.-based biotechnology company, raised $18 million Series D funding. Fall Line Capital led the round, and was joined by investors including S2G Ventures, Lewis and Clark Ventures, and Macro Capital Investments.
• Paragon Genomics, a Hayward, Calif.-based life science company, raised $8 million in Series A funding. Cowin Venture Capital and Fosun Industrial Co led the round, and were joined by investors including Cloudstone Venture, HEDA Ventures and Wisemont Capital.
PRIVATE EQUITY DEALS
• Crestline Investors Inc made an investment of an undisclosed amount in Gem Containers Limited, a London-based tank container leasing and management company.
• Sycamore Partners completed its $6.9 billion acquisition of Staples Inc (Nasdaq:SPLS).
• Centene Corp will buy Fidelis Care, a New York State-sponsored health insurance program provider, for $3.75 billion, according to Reuters. Read more.
• Nordstrom Inc’s (NYSE:JWN) founding family has selected Leonard Green & Partners to help take the high-end retailer private, according to Reuters. Financial terms weren’t disclosed. Read more.
• ASR will buy the Dutch operations of Italy’s Generali (BIT:G) for 143 million euros ($171 million), according to Reuters. Read more.
• Howard Midstream Energy Partners, a San Antonio, Texas-based natural gas company, said it plans raise $200 million. In 2016, the company posted revenue of $124.9 million and loss of $3.9 million. Barclays, RBC Capital, Tudor, Pickering, Holt & Co., BofA Merrill Lynch, Citigroup, MUFG, SunTrust Robinson Humphrey, and Wells Fargo Securities are book-running managers in the deal. The company plans to list on the NYSE as “HMP.”
• PSI International, a Virginia-based IT company that provides services for the Department of Defense and other government agencies such as the New York MTA, filed for an IPO through Reg A+. The company said it would raise $30 million in an offering of 2 million shares at $15 a piece. In 2016, the company posted revenue of $52.5 million on income of $1.1 million. The company plans to list on the Nasdaq as “PSIT.” The company has not named an underwriter.
• Tonka Bay Equity Partners sold CORWIL, a Milpitas, Calif.-based provider of outsourced integrated circuit assembly and test services, to Integra Technologies. Financial terms weren’t disclosed.
• Zomato acquired Runnr, an India-based delivery startup, for a reported $40 million, according to TechCrunch. Runnr raised approximately $28 million in venture funding from investors including Blume Ventures, Nexus Venture Partners, and Sequoia Capital. Read more.
• Avi Networks acquired StacksWare, a San Francisco-based a SaaS cloud management solutions provider. Financial terms weren’t disclosed. StacksWare raised $2 million in venture funding from investors including Greylock Partners and Lightspeed Venture Partners.
• Clearlake Capital Group, L.P. sold Calero Software, a Rochester, N.Y.-based communications lifecycle management software provider, to Riverside Partners. Financial terms weren’t disclosed.
FIRMS + FUNDS
• Bain Capital, a Boston-based investment company, raised $9.4 billion for its next North American buyout fund in about five months, according to Bloomberg. Read more.
• Francisco Partners, a San Francisco-based private equity firm, is seeking to raise $3.25 billion for Francisco Fund V, according to Private Equity International. Read more.
• The Riverside Company, a New York-based private equity firm, raised more than 312 million euro ($371 million) for its fifth Europe-focused fund, according to an SEC filing. The target is 450 million euro ($536 million).
• James Huang, a managing partner at KPCB China, launched Panacea Venture, according to Private Equity International. Panacea will seek $150 million for Panacea Venture Healthcare I.
• Insignia Ventures Partners, a Singapore-based venture firm, raised $25 million for its inaugural fund, according to an SEC filing.
• David Snider is joining Bain Capital Ventures as an executive-in-residence. Previously, Snider was at Compass.
• Kyle Engle joined StepStone Group as an associate, according to his LinkedIn. Previously, Engle was at Morgan Creek Capital Management.
• Thrive Capital hired Ryan Pripstein, Ryley Reynolds, and Gaurav Ahuja as investors.
• Liesl Sitton joined BayBoston Managers as a managing partner. Previously, Sitton was at Boston Consulting Group.
• Kinzie Capital Partners named Michael Sullivan an associate and Katie Li as a senior analyst of finance and operations.
• Frits van Paasschen joined TPG Capital as a senior adviser, according to Reuters. Van Paasschen was the former Starwood Hotels and Resorts CEO. Read more.
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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.