WALL STREET'S UNLIKELY STAR
Good morning, Term Sheet readers.
When Brian Moynihan became CEO of Bank of America in 2010, he was dismissed as a colorless attorney who lacked the operating expertise to rescue the flailing colossus. In a column published last night, Fortune’s Shawn Tully explains how Moynihan has turned into Wall Street’s most unlikely star.
In its fourth quarter report, it reported the highest earnings in company history. The bank posted a $8.7 billion in pre-tax earnings, lifting the total for the full year to $34.6 billion, a 25.3% gain over 2017. In two days, B of A’s stock jumped 9.2%, adding $30 billion in market cap.
When Moynihan first took the job, he swore by a back-to-basics strategy that has served him well, Tully writes. From the story:
Those numbers enshrine Moynihan as Wall Street’s most unlikely star. He deserves that status by never wavering from the playbook that he first championed shortly after becoming CEO in the dark days of 2010. At the time, Moynihan pledged a return to the kind of low-risk, grow-with-your customers banking that prevailed in the 1950s.
The idea was that banks are handed a treasure trove in the form of deposits at near-zero or extremely low rates. Banks, Moynihan said, should generate excellent profits by lending out those cheap deposits at far higher rates for credit card, corporate, margin, mortgage, and consumer loans. The rub is that for the past two decades, the banks almost invariably squandered the profits made in good times by taking big risks, especially in speculative trading and underwriting exotic securities. Moynihan promised to deploy capital markets to serve corporate clients, not chasing speculative windfalls.
DAVOS UPDATE: President Donald Trump cancelled the U.S. delegation’s trip to the World Economic Forum in Davos. Read more.
PEOPLE MOVES:
— John Lilly became the third high-profile person to leave Greylock Partners full-time within the last year. Lilly, who was the former CEO of Mozilla, will leave the firm to focus on political initiatives.
— Slack’s chief product officer April Underwood announced yesterday she would leave the company to focus on investing full-time. She’s a founding partner of #Angels, an investment collective that aims to get more women on startup cap tables. It’s unclear whether she plans to join a VC firm or focus on her own investing venture #Angels. Stay tuned.
HOUSEKEEPING: As a reminder, Term Sheet won't be in your inbox this Monday for the MLK holiday. I'll still be around, so feel free to tweet at me here. Have a great weekend, and see you next week!
VENTURE DEALS
• Niantic, the developer of augmented-reality games such as Pokemon Go, raised $245 million in Series C funding at a valuation of approximately $4 billion. IVP led the round, and was joined by investors including aXiomatic Gaming, Battery Ventures, Causeway Media Partners, CRV, and Samsung Ventures.
• Flash, a “micro-mobility” startup, raised €55 million ($62.7 million) in Series A funding. Investors include Target Global, Idinvest Partners, and Signals Venture Capital.
• Zipwhip, an operator of a texting medium that adds text messaging to existing landline, VoIP and toll-free phone numbers, raised $51.5 million in Series D funding. Goldman Sachs Private Capital Investing led the round, and was joined by investors including OpenView, M12, and Voyager Capital.
• Bukalapak, an Indonesia-based e-commerce company, raised $50 million in Series D funding, from the Mirae Asset-Naver Asia Growth Fund.
• Limelight Health, a San Francisco-based provider of insurance underwriting and proposal platform for the employee benefits industry, raised $33.5 million in Series C funding. Principal Life led the round, and was joined by investors including AXA Venture Partners, MassMutual Ventures, Aflac Ventures, Transamerica Ventures, Wells Fargo Strategic Capital, LaunchPadDigital Health and Wanxiang America Healthcare Investments.
• HighLife SAS, a Paris-based medtech company, raised 32 million euros ($36.5 million) in Series B funding. U.S. Venture Partners and Andera Partners led the round.
• HyperScience, a company that creates AI-centered enterprise solutions for automating work, raised $30 million Series B funding. Stripes Group led the round, and was joined by investors including FirstMark Capital and Felicis Ventures, as well as new investors Battery Ventures, Global Founders Capital, TD Ameritrade and QBE.
• ScaleFactor, an Austin, Texas-based intelligent finance and automated accounting platform, raised $30 million in Series B funding. Bessemer Venture Partners led the round, and was joined by investors including Canaan, Broadhaven Ventures, and Firebrand Ventures. Read more at Fortune.
• Bolder Surgical, a Louisville, Colo.-based provider of surgical instruments, raised $27 million in funding. River Cities Capital Funds led the round, and was joined by investors including Westwood Management and Providence Ventures.
• SeeTree, a Tel Aviv-based intelligence network for trees, raised $15 million in funding. Investors include Hanaco Ventures and Canaan Partners Israel.
• Birdies, a San Francisco-based footwear brand, raised $8 million in Series A funding. Norwest Venture Partners led the round.
• Netrounds, a Sweden-based provider of software-based active testing, monitoring and automated troubleshooting solutions, raised Series A funding of an undisclosed amount. Investors include Swisscom Ventures.
PRIVATE EQUITY DEALS
• Definitive Healthcare, which is backed by Spectrum Equity, acquired HIMSS Analytics, a Chicago-based provider of healthcare data including intelligence on technology installs and purchasing contracts. Financial terms weren't disclosed.
• Lightview Capital made a “significant” investment in Educational Measures LLC, a Denver-based provider of live event technology focused on audience engagement and associated data and analytics. Financial terms weren't disclosed.
• Egis Capital Partners and ABS Capital Partners acquired ClearObject, a provider of cloud-based IoT solutions and managed services for asset and data intensive industries. Financial terms weren't disclosed.
OTHER DEALS
• Google agreed to acquire some of Fossil Group’s smartwatch technology and members of the research and development division responsible for creating it. The deal is worth approximately $40 million. Read more.
IPOs
• Maoyan Entertainment, the Chinese movie ticketing platform, filed for a Hong Kong IPO to raise $345 million, down from what it was seeking last year. Tencent and Meituan Dianping back the firm. Read more.
FIRMS + FUNDS
• Macquarie Infrastructure and Real Assets, a New York-based infrastructure asset manager specializing in real estate, raised $5 billion for its Macquarie Infrastructure Partners IV.
PEOPLE
• Michael Sfalcin joined Yaletown Partners as a principal.
• Allegiance Capital promoted Shane Mahmood to president, Eric Kern to managing director and George Burrell to vice president.
• The CapStreet Group promoted Adrian Guerra to partner and Kevin Johnson to principal.
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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.
