(ALWAYS) DAY 1
Good morning, Term Sheet readers.
🎉TERM SHEET ANNIVERSARY 🎉: Today marks one year since I took over this beast of a newsletter that I’ve come to love so dearly. The crippling daily anxiety of not knowing what to write about has mostly subsided and I now wake up at 5 a.m. instead of 4:30, so we’re making progress.
In the last year, we’ve profiled more than 40 dealmakers; written at length about Softbank, electric scooters, Elon Musk and Theranos; and compiled your thoughts on whether private equity is in a bubble.
I’ve also received lots of constructive feedback from Term Sheet readers (including when I committed “an egregious written abuse” of the English language”). In all seriousness, thank you for reading, and I look forward to hearing your thoughts every day. Cheers to many more.
TOYOTA + UBER: Toyota is going all in on autonomous vehicles. The automaker will invest about $500 million in Uber as part of a bigger plan to manufacture Sienna vehicles equipped with Uber’s self-driving technology. The deal increases Uber’s paper valuation by 15% and values the ride-hailing company at approximately $72 billion.
Uber CEO Dara Khosrowshahi hinted at this partnership at Fortune’s Brainstorm Tech conference in July, when he spoke about the importance of building autonomous vehicle technology in-house while also partnering with third-party companies. “I believe in the early days of development of self-driving technology, it’s important for us to guarantee access to that tech,” he said. “We will be completely open, however, to working with other self-driving tech partners.”
More and more carmakers are trying to position themselves for a future in which car ownership gives way to mobility as a service. As Khosrowshahi added at Brainstorm Tech: "If there is one thing to fear, it's around car ownership. We'll become more and more competitive with car ownership across swaths of cities."
WILL SOFTBANK DELIVER?: EquityZen released a report that analyzes whether Softbank’s $100 billion Vision Fund can deliver competitive returns to its investors. The researchers begin the report, titled “SoftBank: Vision or Delusion,” with the following: “The sheer amount of capital deployed has left the venture capital world stunned, with many questioning if competitive returns are possible at this massive funding scale.”
It’s something many in venture are undoubtedly wondering — Can Masayoshi Son replicate SoftBank’s stellar historical returns? Investors reportedly expect a 20% IRR from the Vision Fund, but in order to meet that goal, Softbank will have to generate $142 billion in lifetime investment gains, according to EquityZen’s analysis. For context, it took Amazon 16 years to reach the $142 billion mark.
“To put these target returns into perspective, SoftBank will need to distribute a Spotify-sized company (worth $26.5 billion at time of IPO in April 2018) for 7 straight years,” the report notes. “Or they'll need to match the GDP of El Salvador every year over the same time period.”
EL SALVADOR. Anyway, there’s some great analysis in this report, and I encourage you to read it in full here.
THE LATEST FROM FORTUNE...
• How the U.S. Cities with the Fastest Download Speeds Stack up Globally (by Brian O’Keefe & Nicolas Rapp)
• Trump's trade deal with Mexico could mean a longer trade war with China (by Hallie Detrick)
• AI Is Bringing On the Fifth Wave of Computing (by Adam Lashinsky)
• Trump Says Google Search Results Are 'Rigged' and Suppress Conservative Voices (by Natasha Bach)
• Evolve Vacation Rental Network, a Denver-based vacation rental management company, raised $80 million in funding. T. Rowe Price Associates Inc led the round, and was joined by investors including Winslow Capital Management, Foxhaven Asset Management, Arrowmark Partners Annox Capital, Allen & Company LLC and PAR Capital Ventures.
• Puls Technologies, Inc, a provider of rapid-response in-home repair and installation for smartphones, raised $50 million in Series C funding. Temasek led the round, and was joined by investors including Sequoia Capital, Red Dot Capital Partners, Samsung NEXT, Viola Ventures, Hanaco Ventures and Hamilton Lane.
• Spotinst, a company that helps companies manage and optimize their cloud computing spend, raised $35 million in Series B funding. Highland led the round, and was joined by investors including Leaders Fund, Intel Capital, and Vertex Ventures.
• Narvar, a San Mateo, Calif.-based premium post-purchase customer engagement platform, raised $30 million in Series C funding. Accel led the round, and was joined by investors including Battery Ventures, Salesforce Ventures and Scale Venture Partners.
• Salary Finance, a U.K.-based FinTech financial wellbeing platform for employees, raised $20 million in Series B funding. Blenheim Chalcot led the round.
• Deserve, a Menlo Park, Calif.-based financial tech company that helps people build credit and achieve financial independence, raised $17 million in Series C funding. Investors include Accel, Aspect Ventures, Pelion Ventures, Mission Holdings, Alumni Venture Group and GDP Venture.
• Foodsby Inc, a Minneapolis-based lunch delivery service, raised $13.5 million in Series B funding. Piper Jaffray Merchant Banking led the round, and was joined by investors including Greycroft Partners, Corazon Capital LLC and Rally Ventures.
• Bellwether Coffee, a Berkeley, Calif.-based developer of coffee roasting hardware and software, raised $10 million in Series A funding. Congruent Ventures led the round, and was joined by investors including FusionX Ventures, Tandem Capital, New Ground Ventures, Hardware Club, XN Ventures, and Peter and Lyndon Rive.
• Apperio, a U.K.-based legal tech start-up changing the way companies analyse their legal spend, raised $10 million (£7.5 million) in Series A funding. Draper Esprit led the round, and was joined by investors including Notion and IQ Capital.
• MusicLife, a blockchain music exchange ecosystem, raised $5 million in Series A funding. Metropolis VC led the round.
• Liquid I.V, a non-GMO electrolyte drink mix, raised $5 million in Series B funding. CircleUp Growth Partners led the round, and was joined by investors including TQ Ventures, Kygo, Myles Shear; and Adam Eaton.
• Colendi, a Switzerland-based microfinance-focused credit scoring solution for the unbanked and underbanked, raised $2.5 million in funding. Investors include Aslanoba Capital, Bogazici Ventures, and Next Ventures.
• Sotera Medical Corp, a Cleveland, Ohio-based medical device company, raised funding of an undisclosed amount, from Valley Growth Ventures.
PRIVATE EQUITY DEALS
• Apollo Global Management agreed to buy Aspen Insurance Holdings Ltd (NYSE:AHL) in a deal valued at $2.6 billion. Apollo is paying $42.75 cash for each outstanding Aspen share.
• Serent Capital made a minority investment in GDS Link, a Dallas, Texas-based provider of credit risk management software. Financial terms weren't disclosed.
• Arlington Capital Partners acquired Black Box Corp‘s government solutions division. Financial terms weren't disclosed. The division will operate as Tyto Athene, a systems integrator and managed services provider of communications systems for the Department of Defense.
• Baum Capital Partners recapitalized Goettl Air Conditioning, a Las Vegas-based provider of HVAC and plumbing maintenance, repair and replacement services. Financial terms weren't disclosed.
• Sage Capital LLC made an investment in Check Corp, a Troy, Mich.-based maker of flexible heating elements, control systems, and related components. Financial terms weren't disclosed.
• Hammond, Kennedy, Whitney & Company Inc acquired Urban Armor Gear LLC, a Laguna Niguel, Calif.-based maker of branded, patented, and rugged protective cases for mobile phones, laptops, and tablets. Financial terms weren't disclosed.
• BGF invested £7.5 million ($9.7 million) in Purity Brewing Co, a U.K.-based independent brewery that’s behind beers such as Mad Goose and Pure Ubu.
• Coronado Coal, a Connecticut-based coal mining firm, is reportedly prepping for an A$1 billion ($732 million) IPO in Australia, Reuters reports. Energy and Minerals Group backs the firm. Read more.
• NB Capital Acquisition, a New York-based SPAC, withdrew its $250 million IPO. Neuberger Berman Managing Director Anthony Tutrone was CEO of the firm. Citi was underwriter. It planned to list on the Nasdaq as “NBCPU.” Read more.
• Livent, Philadelphia, Penn.-based lithium batteries maker for electric cars spun out of FMC, filed for a $100 million IPO. The segment posted revenue of $347.4 million and income of $42.2 million in 2017. BofA Merrill Lynch, Goldman Sachs and Credit Suisse are underwriters. FMC backs the firm. It plans to list on the NYSE as “LTMH.” Read more.
• Wright Medical agreed to acquire Cartiva, an Alpharetta, Ga.-based orthopaedic medical device company, for $435 million. Cartiva had raised more than $24 million in venture funding from investors including New Enterprise Associates and Windham Venture Partners.
• KinderCare Education, which is backed by Partners Group, acquired Rainbow Child Care Center, a Troy, Michigan-based child care provider. Financial terms weren't disclosed. Rainbow was backed by Quad-C Management.
• BWAY, a subsidiary of Stone Canyon Industries LLC, acquired Industrial Container Services, a Maitland, Fla.-based provider of container solutions, container services and container management systems. The seller was Centerbridge Partners. The deal values the company at approximately $1 billion.
• Yellow Wood Partners agreed to buy Paris Presents Inc, a Gurnee, Ill.-based provider of branded cosmetic and bath accessories. Financial terms weren’t disclosed. Sellers include EagleTree Capital.
• Carlyle Group agreed to buy Crestview Partner’s remaining shareholding in NEP, a broadcast services company, resulting in a majority stake. Financial terms weren’t disclosed.