Good morning, Term Sheet readers.
Music streaming company Spotify finally filed for its non-traditional IPO yesterday, suggesting it will begin trading publicly later this month. Spotify is the first large, high-profile company to pursue a direct listing of its shares. It’s an unusual move with some clear benefits — no banks, no roadshow, no crazy fees, and no lock-up period.
But of course, the faster and cheaper route comes with risks. As it notes in its prospectus, there are no safeguards to protect it from volatility. It reads, “...the trading volume and price of our ordinary shares may be more volatile than if our ordinary shares were initially listed in connection with an underwritten initial public offering.”
Some notes from the Form F-1:
• The filing showed heavy losses. Last year, when it generated €4.1 billion ($5.02 billion) in revenue, it lost €1.24 billion ($1.51 billion) — up from €539 million in 2016 and €230 million the year before that.
• Investors trading Spotify’s shares in private transactions have valued the company as highly as $23 billion.
• By the end of 2017, Spotify reported 159 million active users, including 71 million paying subscribers. “We believe that our number of Premium Subscribers is nearly double the size of our nearest competitor, Apple Music,” the filing said. The statement is in line with Apple’s report from February that it has approximately 36 million paid subscribers.
• The largest stakeholders are its two founders: CEO & co-founder Daniel Ek, who owns 25% of the company, and co-founder and director Martin Lorentzon, who owns 13%.
• The duo also has “beneficiary certificates,” which entitle them to extra voting rights. Ek has 37.3% voting power while Lorentzon has 43.1%.
• Spotify intends to list on the NYSE under the symbol “SPOT.”
The bottom line is: All eyes will be on Spotify’s much-anticipated IPO. Depending on how it goes, the company’s direct listing could serve as a template for existing unicorns looking for a cheaper, more innovative approach to going public.
THIS JUST IN: DoorDash, a San Francisco-based on-demand restaurant food delivery company, is raising $535 million in funding at a $1.4 billion valuation. SoftBank led the round, and was joined by investors including Sequoia Capital, and Singaporean sovereign wealth fund GIC. Here’s where it gets complicated thanks to Softbank (again): The Japanese tech behemoth is also an investor in Uber, whose UberEATS is a competitor to DoorDash...Read more at Fortune.
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• Astranis, a San Francisco-based manufacturer of small, low-cost telecommunications satellites, raised $13.5 million in Series A funding. Andreessen Horowitz led the round, and was joined by investors including Y Combinator, Fifty Years, Refactor Capital and Indicator Fund.
• Coalition Inc, a San Francisco-based cyber insurer, raised $10 million in Series A funding. Investors include Vy Capital, Ribbit Capital, Valor Equity Partners, Y Combinator President Sam Altman and Deep Nishar.
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• Triplebyte, a San Francisco-based recruiting and technical screening platform for tech companies, raised $10 million Series A funding. Initialized Capital led the round, and was joined by investors including Caffeinated Capital, Felicis Capital, Jessica Livingston, Paul Graham, Emmett Shear, Kyle Vogt, and Marissa Mayer.
• Woebot Labs, Inc, a chatbot who helps monitor moods, raised $8 million in Series A funding. New Enterprise Associates led the round, and was joined by investors including the AI Fund.
• Virtualitics, a Pasadena, Calif.-based platform that merges AI, big data, and virtual/augmented reality, raised $7 million in Series B funding. Centricus led the round, and was joined by investors including Venture Reality Fund.
• Eko, a Berkeley, Calif.-based maker of an acoustic cardiac monitoring, raised $5 million in Series A funding. Artis Ventures led the round, and was joined by investors including Strategic Partners, Dreamlt Ventures, 1812 Ventures and Founder.org.
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• OnScale, a platform that allows engineers to accelerate innovation in 5G, biomedical, and IoT markets, raised $3 million in seed funding. Thornton Tomasetti led the round.
• Blueprint Income, a New York-based fintech startup, raised $2.75 million in seed funding. NextView Ventures and Green Visor Capital co-led the round, and were joined by investors including Center for Financial Services Innovation FinLab, Core Innovation Capital, Kairos Ventures, Jean Chatzky, and Plug ’n Play.
• Current, a New York-based debit card for teens, raised $1 million in funding from Fifth Third Capital.
HEALTH AND LIFE SCIENCES DEALS
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FIRMS + FUNDS
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