Term Sheet — Friday, September 29
THE NIKE OF SLEEP: Casper struck a partnership with American Airlines to make flights slightly more comfortable. On Thursday, the mattress startup announced that it will design eight new bedding products, including a mattress pad for the seat, two kinds of pillows, a pillowcase, a duvet, a blanket, pajamas and slippers. The company declined to disclose the terms of the deal, but noted that this marks Casper’s first foray outside of the bedroom.
I had a chance to speak with Casper CEO Philip Krim at the TAP Conference yesterday. Here are some highlights from our chat:
• Retail: Even though Casper launched as a company that removed the retailer from the equation, the startup is now starting to focus on the offline experience. It’s launching 15 pop-up stores across the country in Q4 so that people can touch and feel their products before they buy. (In other words, it feels as though Casper is the bazillionth direct-to-consumer startup to get into retail.) “We’ve never been anti-retail — just anti-mattress retail,” Krim said.
• Marketing: Casper has spent a significant amount of capital on marketing initiatives, including napmobiles, a cruise around Manhattan, and a hotline that helped people fall asleep.” Krim said the company’s tried to take a more non-traditional approach to marketing. “The best thing we can do is have people see one of our ads and think, ‘Oh, that’s fun and tongue-in-cheek.’”
• Acquisition: Earlier this year, Target offered to buy Casper for a billion dollars. After Casper turned it down, the retailer opted to invest $75 million instead. Krim said an acquisition didn’t make sense this early on as the company still has time “to build an iconic brand.”
• Profitability: I asked Krim at what point profits will become the company’s top priority. He said Casper is still relatively young, and he’s confident it can get a lot bigger. “We’re continuing to build awareness and build a paradigm for this ‘sleep’ category that hasn’t existed before,” he said. So in other words, don’t hold your breath. ¯\_(ツ)_/¯
For more, read Erin’s August feature on Krim and his massive ambitions to turn Casper into “the Nike of Sleep.”
IKEA SHOPPING SPREE: Ikea just dove into the “gig economy” after acquiring on-demand services startup Taskrabbit. Although the terms of the deal have not been disclosed, Recode reports that TaskRabbit will operate as an independent subsidiary within Ikea. The startup had raised approximately $50 million in venture funding from investors including 500 Startups, Founders Fund, Floodgate, and Lightspeed Venture Partners. There are still a lot of questions swirling around the deal. My Fortune colleague Anne VanderMey outlines some of the possibilities:
“Did Ikea buy TaskRabbit because its furniture is too hard to put together, as Fast Company recently pondered? Or did it do it because millennials are too maladapted to do heavy assembly, and too cheap to call normal handymen for their floating bookcases? Or maybe it’s because their store experiences are too time consuming and borderline traumatic.”
If you’re looking for a good weekend read, this reminds me of a brilliant feature that Fortune published in 2015. Appropriately titled, “How Ikea took over the world,” it delves into how the Swedish home furnishings company used to be lousy at expansion before it built a truly global empire. My favorite quote is from Ikea’s deputy manager of packaging:
There’s an internal nickname for products that take too long to put together. “Sometimes,” Dickner says, ‘we call it a ‘husband killer.’”
Let’s see if TaskRabbit can help with that. Read the full feature here.
THE LATEST FROM FORTUNE...
• Uber’s corporate customers will have to pay more (by Jen Wieczner)
• GoPro launches a new camera (by Michal Lev-Ram)
• Celebrities continue to endorse initial coin offerings (by Robert Hackett)
• Elon Musk wants to colonize Mars in 2022 (by Feliz Solomon)
• A top VW manager has been arrested over his role in the Diesel scandal (by Geoffrey Smith)
Anthony Levandowski founded a techno-futuristic church. South Korea bans ICOs. Walmart’s Jet.com will launch its own line of groceries. Uber’s next step in London. H&M hits the wall. Can tech startups do journalism?
• LetGo, a New York-based startup that has built a marketplace for people to buy and sell used goods, raised $100 million in funding at a valuation of over $1 billion, according to TechCrunch. Read more.
• EchoNous, a Seattle-based parent company of Signostics, an ultrasound tool for bladder and kidney care, raised $35 million in funding from KKR.
• Drive.ai, a Mountain View, Calif.-based developer of artificial intelligence software for autonomous vehicles, raised $15 million in funding from Grab.
• Enevo, a Finland-based waste services provider, raised $12 million in funding. Lifeline Ventures led the round.
• Anchor, a New York City-based podcast app, raised $10 million in Series A funding. GV led the round, and was joined by other investors including Accel, Betaworks, The Chernin Group, Eniac Ventures, Homebrew and Craig Kallman.
• Varjo Technologies, a Finland-based virtual and augmented reality headset developer, raised $8.2 million in Series A funding. Investors include EQT Ventures, Lifeline Ventures, and The Venture Reality Fund.
• Opkix, a Costa Mesa, Calif.-based consumer camera products and software developer, raised $5.4 million in Series A funding at a $90 million valuation. Investors include Bob McKnight and Jennifer Prince.
• Jobbatical, an Estonia-based job platform, raised $4 million in funding. Mistletoe Inc led the round, and was joined by investors including Union Square Ventures, AirTree Ventures and Tera Ventures.
• AdAsia Holdings, a Singapore-based developer of artificial intelligence and marketing solutions, raised $2.5 million in Series A funding. Investors include Hisanori Watanabe and Gunosy.
• DreamJay, a San Francisco and Poland-based maker of a medical app that helps prevent nightmares, raised $2.3 million in Series A funding. Joint Polish Investment Fund led the round, and was joined by investors including Nordic Makers.
• Trellis, an Oakland, Calif.-based provider of cannabis inventory management software, raised $2 million in funding. Casa Verde Capital led the round, and was joined by investors including Gateway, Argonautic Ventures and One Gun.
• GroupSolver, a San Diego, Calif.-based online consumer research company, raised $1 million in funding. Tech Coast Angels’ San Diego network led the round.
• Siigo, a Colombia-based provider of accounting and administrative software for small and medium sized companies, raised funding of an undisclosed amount from Accel-KKR.
HEALTH AND LIFE SCIENCES DEALS
• Peptilogics, a pre-clinical stage company utilizing an innovative peptide platform to treat multidrug-resistant bacterial infections, raised $5.5 million in Series A funding. Investors include Peter Thiel, Stefan Roever and BlueTree Ventures.
PRIVATE EQUITY DEALS
• Carlyle Group LP is in talks to sell a stake in TCW Group Inc, a Los Angeles-based investment manager, to bidders including Nippon Life Insurance Co. and Mitsubishi UFJ Financial Group Inc., according to The Wall Street Journal. Read more.
• Alpine Investors made an investment in Bill4Time, a Seattle and Pittsburgh-based provider of cloud-based time and billing software. Financial terms weren’t disclosed.
• Berkshire Partners acquired Accela, Inc, a San Ramon, Calif.-based provider of civic engagement software solutions for state, county and municipal governments. Abry Partners will remain an investor in the company. Financial terms weren’t disclosed.
• Togetherwork, which is backed by Aquiline Capital Partners LLC, acquired Gingr, a Boulder, Colo.-based provider of pet services software. Financial terms weren’t disclosed.
• M Group Services acquired Magdalene Ltd, a U.K.-based telecommunications infrastructure services provider. Financial terms weren’t disclosed.
• Clarim Holdings invested in Copperfield Advisory, a New York City-based consulting firm providing professional support on marketing, communications, public affairs and strategy. Financial terms weren’t disclosed.
• Naspers acquired another 13% stake in Delivery Hero (DB:DHER), a Berlin based food-delivery company, for €660 million ($775 million), from Rocket Internet. Naspers now owns 26.3% of the company.
• Daimler acquired Flinc, a Germany-based peer-to-peer-style carpooling platform, according to TechCrunch. Financial terms weren’t disclosed, but Flinc had raised funding of an undisclosed amount from investors including Deutsche Bahn, General Motors Ventures, and ISB Ventures. Read more.
• IK Investment Partners agreed to sell Evac Group, a Finland-based provider of integrated waste, wastewater, and water management systems, to Bridgepoint, according to Reuters. Financial terms weren’t disclosed. Read more.
FIRMS + FUNDS
• New Mountain Capital, LLC, a New York-based investment firm, raised $6.15 billion for its fifth private equity fund, New Mountain Partners V, L.P.
• MidOcean Partners, a New York-based private equity firm, raised $680 million for its new fund, MidOcean Partners V, L.P.
• Leerink Transformation Partners, a Boston-based private equity firm, raised $313 million for its debut fund, Leerink Transformation Fund I LP.
• Leah Busque, founder of TaskRabbit, joined Fuel Capital as a general partner.
• Ken Denman joined Sway Ventures as a venture partner. Previously, he was CEO of Emotient.
• Raymond James named Geoffrey Richards as a managing director in its investment banking unit. Previously, Richards was at Canaccord Genuity.