THE RISE OF THE BILLION-DOLLAR FUND
Good morning, Term Sheet readers.
THE MEGA-FUND: Yep, the season of the billion-dollar venture fund is still going strong. Venture firms raised a whopping $8 billion worth of new funds in the span of 10 days (!) Last week, GGV Capital raised $1.9 billion across several vehicles, and this week, we had Tiger Global debut a $3.75 billion fund and Josh Kushner’s Thrive Capital raise $1 billion. To close out the week, Bessemer Venture Partners announced $1.85 billion for its new fund, BVP X.
This influx of capital makes sense given that the bulk of venture capital funds raised by U.S. technology start-ups in the third quarter came from “mega-rounds” of $100 million or more. If 2018 is the year of the mega-fund, who knows what 2019 will bring?
A TESLA SHORT: In yesterday’s Term Sheet, we included a line about how short seller Andrew Left reversed his position on Tesla this week. It was a remarkable reversal for Left, who had been loudly shorting Tesla stock for more than two-and-half-years, until this week, when he declared in the report that he was now long Tesla stock.
I received the following response from a Term Sheet reader:
Interesting moral if not legal question. Elon Musk tweets about “funding secured,” moves the market, and gets sued by the SEC and others, including Left, even though he did not act on the market move nor benefit from it. Left builds an ownership which contradicts his public statements, then discloses it, handsomely benefits from it and that’s OK?
Certainly begs the question of public disclosure and market manipulation in those days where media-covered announcements move markets. BTW, it is true of a lot of ‘activist investors.’ Can someone build a position in a stock and then move the stock or should they be forced to do the opposite?”
I thought this was a very good question. Some people would say “no,” but I’m sure others would argue it’s completely within the rules of the game. I’m not too familiar with the nuances of short selling, so I’d love to hear from you. Reply to this email or email me directly at firstname.lastname@example.org.
CONSUMER CONFIDENCE: There are some interesting revelations this morning out of a new report from JUST Capital, a nonprofit founded by hedge fund manager Paul Tudor Jones that tracks and ranks companies on the business behaviors Americans care about most.
The report found that a greater share of people—30%, up from 27% in 2017 and 26% in 2016—see business as heading in the right direction. A smaller share of the public—38%, down from 47% last year—view business as heading in the wrong direction. Meanwhile, 32% aren’t sure, up from 25% last year.
• Area 1 Security, a Redwood City, Calif.-based provider of cybersecurity solutions, raised $32 million in Series C funding. Kleiner Perkins led the round, and was joined by investors including Icon Ventures, DCVC, Top Tier Capital, Allegis Cyber and Epic Ventures.
• Infoworks, a Palo Alto, California-based software platform provider for agile data engineering, raised $25 million in Series C funding. New Enterprise Associates led the round, and was joined by investors including Nexus Venture Partners and Centerview Capital Technology.
• WireWheel, a Arlington, Va.-based software-as-a-service platform “that modernizes global data privacy compliance,” raised $10 million in Series A funding. New Enterprise Associates and PSP Growth led the round.
• Teikametrics, a Boston-based retail optimization platform, raised $10 million in Series A funding. Investors include Granite Point Capital,Jump Capital and FJ Labs.
• Hackajob, a London-based tech talent recruitment platform, raised $6.7 million in funding. AXA Venture Partners led the round, and was joined by investors including Downing Ventures.
• Gradient.io, a Seattle-based company that helps brands improve their performance on Amazon, raised $3.5 million in seed funding. Investors include Flying Fish VC, Pioneer Square Labs, MDC Ventures, and Black Jay Investments.
• Pathmatics, a Santa Monica, Calif.-based marketing intelligence platform, raised $3 million in funding. Mintel and SPH Ventures co-led the round, and were joined by investors including Upfront and BDMI.
• Lorem, a platform that connects business owners to a curated, professional network of freelance website designers and developers, raised $2.5 million in funding. Flybridge Capital Partners led the round, and was joined by investors including HubSpot, FJ Labs and Fresco Capital.
• VergeSense, a San Francisco-based provider of an AI-powered sensor-as-a-service platform for commercial real estate, raised $1.5 million in funding. JLL Spark led the round, and was joined by investors including Bolt and Pathbreaker Ventures.
• GenesisCare, an Australia-based private provider of cancer and cardiac healthcare in Australia and Europe, raised funding of an undisclosed amount. Investors include KKR and China Resources. Macquarie Bank.
HEALTH AND LIFE SCIENCES DEALS
• Galecto Biotech AB, a Sweden-based developer of galectin modulators for the treatment of severe diseases, including fibrosis and cancer, raised €79 million ($89 million) in Series C funding. Ysios Capital and OrbiMed co-led the round, and was joined by investors including Ysios Capital, OrbiMed, HBM Healthcare Investments, OrbiMed Israel, Bristol Myers-Squibb, Maverick Ventures, Seventure Partners, Novo Seeds, M Ventures, and Sunstone Capital.
• Milestone Pharmaceuticals, a Canada-based late-stage biopharmaceutical company developing interventions for tachycardias, raised $80 million in funding. RTW Investments LP led the round, and was joined by investors including Venrock Healthcare Capital Partners, Boxer Capital of Tavistock Group, Novo Holdings A/S, Forbion, funds managed by Tekla Capital Management LLC, Domain Associates, BDC Capital, Pappas Capital, GO Capital and Fonds de solidarité FTQ.
• 89Bio, a San Francisco and Israel-based clinical-stage biopharmaceutical company focused on nonalcoholic steatohepatitis and other liver and metabolic disorders, raised $60 million in Series A funding. OrbiMed Israel, OrbiMed US and Longitude Capital led the round, and were joined by investors including RA Capital Management and Pontifax.
• Sitka Biopharma, a Vancouver-based preclinical biotechnology company, raised $1.9 million in funding. Investors include Quark Venture Inc. and GF Securities.
PRIVATE EQUITY DEALS
• StandardAero Aviation Holdings Inc, a portfolio company of Veritas Capital, is exploring a sale which could fetch over $5 billion, according to The Wall Street Journal. Read more.
• EQT Partners is weighing the sale of Direct ChassisLink Inc, a provider of chassis leasing and other services to shipping companies, railroads, terminal operators, according to Bloomberg. A sale of DirectChassis could fetch more than $2.5 billion. Read more.
• Mediafly, which is backed by Boathouse Capital, acquired Alinean Inc, a Winter Park, Fla.-based software and consulting company focused on empowering B2B sales and marketing teams. Financial terms weren’t disclosed.
• Falfurrias Capital Partners made an investment in Best Impressions Caterers, a Charlotte, N.C.-based catering company. Additionally, it acquired Duvall Catering & Events, a Charleston, South Carolina-based provider of catering and event planning services. Financial terms weren’t disclosed.
• Sverica Capital Management made an investment in Gorilla Logic, a Boulder, Colo.-based provider of software development and consulting services. Financial terms weren’t disclosed.
• Geritrex, a portfolio company of BelHealth Investment Partners, acquired Unipack, a Pittsburgh-based manufacturer and distributor of over-the-counter pharmaceuticals. Financial terms weren’t disclosed.
• Bitfury, a crypto miner maker, is weighing an IPO in Amsterdam, London, or Hong Kong as early as 2019, Bloomberg reports citing sources. The deal could value the firm at between $3 billion to $5 billion. Read more.
• STX Entertainment, the Hollywood studio, allowed its proposed IPO in Hong Kong to lapse. Firms including Tencent back the company. Read more.
• Angeles Equity Partners named Frank Spelman as a managing director. Previously, Spelman was a principal at Apollo Global Management and KKR.
• Atlantic Street Capital promoted Phil Druce and George Parry to partner.