Term Sheet — Wednesday, November 28
NEWS ON THE BLOCK(CHAIN)
Good morning, Term Sheet readers.
In the first offering of its kind, U.S. investors can now acquire a piece of South Carolina real estate in the form of blockchain tokens. The tokens represent ownership in a luxury student residence called The Hub, which is located near the University of South Carolina in the state’s capital.
This is the first tokenized REIT in the U.S. The owner, Convexity Properties, aims to raise $20 million with the token sale by letting accredited investors buy in for as little as $21,000. The buyers will receive tokens that amount to securities, which they will eventually be able to sell on cryptocurrency exchanges.
The company behind the ordeal is Harbor, a tokenized securities startup backed by investors including Founders Fund, Andreessen Horowitz, Pantera Capital, Craft Ventures, and Signia Venture Partners. You might remember the startup from Term Sheet’s Q&A with CEO Josh Stein.
Stein’s big vision is to tokenize all sorts of assets — from fine art to real estate — and make them available in the form of blockchain tokens. In May, he told me that with tokenization technology, you could create leveraged longs and shorts. He said:
You can go long French impressionists and short modern art. You can do the same with real estate — I tear off a 10% strip of all my Class A in Midtown and create a Midtown fund. I can go long Manhattan, I can go short Brooklyn. Yes, there will be some gambling going on, but what’s interesting is that if I’m a property developer and I just put a huge amount of capital into Manhattan, I could effectively hedge my position very cheaply and efficiently.
This idea may sound far-fetched, but Harbor isn’t the only company working on it. On Monday, Coinbase, Blockchain Capital, and several other investors poured $12.75 million into Securitize, an issuance platform for asset-backed security tokens on the blockchain. Earlier this month, AlphaPoint, a company that helps institutions launch trading platforms and tokenize assets with blockchain technology, hired a former senior executive from the Chicago Board Options Exchange (CBOE) to lead its trading and exchange business.
More broadly, security tokens are an interesting segment of the crypto market because they’re backed by real assets such as an equity, shares of a limited partnership company, or commodities. They are also subject to federal security regulations. J.P. Morgan’s co-president Daniel Pinto said earlier this year, “The tokenization of the economy, for me, is real.”
Correction: Yesterday, Term Sheet linked to the wrong Quip. It was New York-based dental care startup Quip that raised $40 million in funding.
THE LATEST FROM FORTUNE...
• Unilever In Exclusive Talks To Buy GSK's Horlicks Unit (by Lucas Laursen)
• AI Is Giving Rise to Fake Fingerprints (by Jonathan Vanian)
• For Birchbox and Glamsquad, It's All About Clicks and Mortar (by Emma Hinchliffe)
• Cryptocurrencies Show Signs of Recovery After a Crash-Tastic Two Weeks (by David Meyer)
• ChargePoint, a Campbell, Calif.-based electric vehicle charging network, raised $240 million in Series H funding. Investors include American Electric Power, Canada Pension Plan Investment Board, Chevron Technology Ventures, Clearvision, Daimler Trucks & Buses, GIC, and Quantum Energy Partners.
• MPOWER Financing, a Washington, D.C.-based student loan provider to international students, raised $110 million in funding. Gray Matters Capital and Community Investment Management led the round.
• Oriente, a Hong Kong-based financial services and technology company, raised $105 million in funding. Investors include a group of family offices including members of Berjaya Group, JG Summit Holdings, Inc., and Sinar Mas.
• Deputy, an Australia-based workforce management software solution, raised $81 million in Series B funding. IVP led the round, and was joined by investors including OpenView, Square Peg Capital and EVP.
• NeueHouse, a New York-based private cultural and collaborative space for creatives, artists and entrepreneurs, raised $30 million in funding. Investors include Diller-von Furstenberg Family Office, Gaw Capital and Revolt Ventures.
• CyberGRX, a provider of a global cyber risk exchange, raised $30 million in Series C funding. Scale Venture Partners led the round, and was joined by investors including Aetna Ventures, AllegisCyber, Bessemer Venture Partners, The Blackstone Group, ClearSky, GV, MassMutual Ventures, and TenEleven Ventures.
• Prose, a technology-powered beauty company, raised $18 million in Series B funding. Insight Venture Partners led the round, and was joined by investors including Forerunner Ventures, ISAI, Lerer Hippeau Ventures and Correlation Ventures.
• Corvus, a Boston-based insurtech company, raised $10 million in Series A funding. Investors include .406 Ventures, Hudson Structured, and Bain Capital Ventures.
• Nifty Games, a California-based new video game publisher, raised $3 million in seed funding. Investors include March Capital Partners, Defy.VC and aXiomatic Gaming.
• Censys, a provider of Internet security data, raised $2.6 million in seed funding. GV and Greylock Partners co-led the round.
• Keyto, a San Francisco-based manufacturer of sensor based breath analyzers, raised $2.5 million in seed funding. Craft Ventures led the round, and was joined by investors including Floodgate Fund, Abstract Ventures and Hydra Ventures.
• NeuroFlow, a mental health technology company, raised $2 million in funding. Investors include NJ JumpStart, Independence Blue Cross, Chestnut Ventures and Ben Franklin Technology Partners.
HEALTH AND LIFE SCIENCES DEALS
• Antios Therapeutics Inc, an Atlanta-based biopharmaceutical company, raised $25 million in Series A funding. Lumira Ventures and Domain Associates led the round.
PRIVATE EQUITY DEALS
• Marlin Equity Partners acquired SimplyWell Inc, a Dallas, Texas-based provider of health management solutions focused on helping companies improve and simplify the well-being of their employees. Financial terms weren't disclosed.
• Albireo Energy, which is backed by Huron Capital, acquired Taylor Consulting & Contracting, an Avoca, Penn.-based energy management company. Financial terms weren't disclosed.
• Bow River Capital recapitalized Precision Spine Care PA, a Tyler, Texas-based physician group focused on treating back and neck pain. Financial terms weren't disclosed.
• Harbour Point Capital recapitalized InSight Telepsychiatry, a Marlton, N.J.-based provider of telepsychiatry services. Financial terms weren't disclosed.
• Signal Peak Ventures appointed Ben Dahl as a managing director.
• Tadhg Flood joined Centerview Partners as a partner.