Pinterest Keeps It Modest, Lyft Sheds Its ‘Nice Guy’ Image, and Grab Is All About the Billions: Term Sheet for Monday, April 8
Pinterest remains modest in all aspects of its business. The social media platform set a price range of $15 to $17 for its initial public offering, which puts it below the valuation at which it last raised private money.
Pinterest last sold shares to pre-IPO investors in 2017 at a price of $21.54 each, valuing the company at roughly $12.3 billion. At the proposed price range, Pinterest would be valued below that level, at around $11 billion at the high end of its range.
In many ways, Pinterest seems to be the most conservative in the cohort of tech companies set to go public in 2019. CEO Ben Silbermann rejects the notion that you have to move fast & break a ton of things to build a big business. He’s done it in a more sustainable, conservative way that has made Pinterest less of “a financial sinkhole” than its peers.
NO MORE MR. NICE GUY: Remember when we were worried that ride-hailing company Lyft had too much of a “nice guy” image to compete with Uber in the public markets? Yeah, I’m not so sure anymore. Lyft has only been public for all of 10 days, and it’s already threatening litigation. The company alleged that Uber IPO underwriter Morgan Stanley was marketing a short-selling product to Lyft investors that it believed was disrupting trading in its stock. Morgan Stanley denies it, telling CNBC that the firm “did not market or execute, directly or indirectly, a sale, short sale, hedge, swap or transfer of risk or value associated with Lyft stock for any Lyft shareholder identified by the company or otherwise known to us to be the subject of a Lyft lock-up agreement.” Oh boy. And Uber hasn’t even gone public yet! It’ll be interesting to see how this shakes out, but don’t let the friendly, pink mustache fool you.
WHAT’S ANOTHER FEW BILLION?: At this point, it feels like every time I sit down to write Term Sheet, Grab decides to raise more money. You might be thinking, “Wait, didn’t Grab just raise billions of dollars?” Yes. Yes, it did. Just a few weeks ago, the company announced $4.5 billion in funding for its latest round. Now, it’s extending its Series H round to $6.5 billion (!). Grab’s valuation hovers at around $14 billion, making it Southeast Asia’s most valuable unicorn.
To better understand Grab’s strategy and find out why it continues to raise so much money, I encourage you to read my colleague Clay Chandler’s excellent feature on its “super-app model.” He writes:
“How to create a super-app for millions of consumers who have never even seen a credit card? Go-Jek and Grab have used the Internet and smartphones ingeniously to create armies of mobile tellers. Car and motorbike drivers collect cash and credit it to customers’ digital wallets. They toil alongside neighborhood agents who, in addition to topping up the wallets, help consumers who lack bank accounts purchase goods online, pay bills, buy insurance, or apply for loans.”
NEW FUND: B Capital, a Singapore-based venture capital firm, raised $406 million for its second fund. Eduardo Saverin, the co-founder of Facebook, is behind B Capital. To date, B Capital has invested in 19 startups, including electric scooter startup Bird. Last year, I spoke with B Capital partner and co-founder Raj Ganguly about why investing in Bird at a $2 billion valuation made sense. He said:
“Bird’s ability to scale revenue with no paid customer acquisition has been incredible. It is one of the fastest growing consumer companies, which is incredible considering it is a physical product, and not software which you can scale with much lower marginal cost. Ultimately, Bird has the potential to completely change how we think about short-distance mobility.”
• Fleetsmith, a San Francisco-based cloud-based fleet management software, raised $30 million in Series B funding. Investors include Menlo Ventures and Tiger Global Management.
• Boomplay, an African music streaming service, raised $20 million in Series A funding. Maison Capital led the round, and was joined by investors including Seas Capital.
• Attest, a London-based provider of market research services, raised $16 million in Series A funding. NEA led the round, and was joined by investors including Oxford Capital and Episode 1 Ventures.
• Enlitic, a San Francisco-based medical startup, raised $15 million in Series B funding. Marubeni led the round, and was joined by investors including Capitol Health.
• TrashButler, a Tampa, Fla.-based valet trash and recycling service for apartments and multi-family communities, raised $4.1 million in funding, from Florida Funders.
• International Screening Solutions, a Kennesaw, Ga.-based provider of a screening platform, raised $1.5 million in funding. Investors include Naples Technology Ventures.
PRIVATE EQUITY DEALS
• The Carlyle Group agreed to acquire a significant minority stake (between 30% and 40%) in Compañía Española de Petróleos, S.A.U (CEPSA), an integrated oil & gas company, from Mubadala Investment Company based on an enterprise value of $12 billion.
• Akoya Capital Partners LLC and Landon Capital Partners LLC acquired TTG Inc, a Higginsville, Mo.-based maker of waterproof membranes. Financial terms weren’t disclosed.
• Clayton, Dubilier & Rice agreed to buy a majority of Sirius Computer Solutions Inc, a San Antonio, Texas-based provider of integrated technology solutions. Financial terms weren’t disclosed.
• Orion Food System, a portfolio company of One Rock Capital Partners, agreed to merge with Land Mark Products, a Milford, Iowa-based maker and distributor of food products as well as a provider of food service solutions to the convenience and specialty retail channels. Financial terms weren’t disclosed.
• TimePayment, which is backed by Fortress Investment Group, acquired LeaseQ, a Burlington, Mass.-based online equipment financing marketplace. Financial terms weren’t disclosed.
• Center Rock Capital Partners acquired Merit, a Spartanburg, S.C.-based distributor of paint sundries, flooring products and related installation supplies. Financial terms weren’t disclosed.
• Great Point Partners recapitalized Little Spurs Pediatric Urgent Care, a San Antonio, Texas-based provider of pediatric urgent care services. Financial terms weren’t disclosed.
• Earthlite LLC, a portfolio company of Branford Castle Partners, acquired Tara Spa Therapy, a Carmel, Calif.-based lotions and creams brand. The seller was Tara Grodjesk. Financial terms weren’t disclosed.
• Artisan Design Group, a portfolio company of The Sterling Group, acquired Markraft Cabinets LLC, a Wilmington, N.C.-based provider of design and installation services for cabinetry and countertops in North Carolina, South Carolina and Tennessee. Financial terms weren’t disclosed.
• Apposite Capital invested 6 million pounds ($7.8 million) in Mirada Medical, a U.K.-based medical imaging software company.
• 2U, Inc. (Nasdaq: TWOU) agreed to acquire Trilogy Education, a New York-based workforce accelerator that prepares adult learners for high-growth careers in the digital economy, for $750 million in cash and stock. Trilogy had raised approximately $80 million in venture funding from investors including Macquarie Group, Highland Capital Partners, ReThink Education, Exceed Capital Partners, and City Light Capital.
• Kettle Cuisine acquired Harry’s Fresh Foods, a Portland, Ore.-based custom food manufacturing company. Financial terms weren’t disclosed.
• Pinterest, a San Francisco, Calif.-based social ideas board maker, plans to raise $1.2 billion in an offering of 75 million shares priced between $15 to $17. The firm posted revenue of $755.9 million and loss of $63 million in 2018. Bessemer (13.1% pre-offering), FirstMark (9.8%), and a16z (9.6%) back the firm. Goldman Sachs, J.P. Morgan, Allen & Company, BofA Merrill Lynch, Barclays, Citi, Credit Suisse, Deutsche Bank and RBC Capital Markets are underwriters. It plans to list on the NYSE as “PINS.” Read more.
• Hookipa Pharma, a New York-based Phase 2 biotech, plans to raise $100 million in an IPO of 6.7 million shares priced between $14 to $16. Baker Bros, Sofinnova Capital, and Forbion Capital back the firm. BofA Merrill Lynch, SVB Leerink and RBC Capital Markets are underwriters. It plans to list on the Nasdaq as “HOOK.” Read more.
• Zoom Video Communications, a San Jose, Calif.-based video conferencing system, plans to raise $326.3 million in an IPO of 10.9 million shares priced between $28 to $32 apiece. It posted revenue of $330.5 million in the year ending 2019 and income of $7.6 million. Emergence Capital, Sequoia, and Li Ka-shing back the firm. Morgan Stanley, J.P. Morgan, Goldman Sachs, and Credit Suisse are underwriters. Read more.
• Metropolis Healthcare, an Indian healthcare firm, is reportedly oversubscribed and plans to raise as much as $174 million in an IPO in the country, Reuters reports. Carlyle Group’s CA Lotus Investments backs the firm. Read more.
• SciPlay, a Las Vegas-based maker of casino-like social games firm, for an $100 million IPO. The firm posted revenue of $416 million in 2018 and income of $39 million. Scientific Games backs the firm. BofA Merrill Lynch, J.P. Morgan, Deutsche Bank, Goldman Sachs, Morgan Stanley, Macquarie Capital, and RBC Capital Markets are underwriters. It plans to list on the Nasdaq as “SCPL.” Read more.
• Palomar Holdings, a La Jolla, Calif.-based specialty property insurance provider focused of floods, earthquakes, and wind damage, plans to raise $90 million in an offering of 5.6 million shares priced between $15 to $17. Genstar Capital backs the firm. Barclays, J.P. Morgan and Keefe Bruyette Woods are underwriters. It plans to list on the Nasdaq as “PLMR.” Read more.
• Trevi Therapeutics, a New Haven, Conn.-based biotech focused on neurological disorders, filed for an $86 million IPO. TPG, NEA, and Lundbeckfond Invest A/S back the firm.
SVB Leerink, Stifel and BMO Capital Markets are underwriters. It plans to list on the Nasdaq as “TRVI.” Read more.
FIRMS + FUNDS
• Source Code Capital, a China-based venture capital firm, raised $570 million for its new fund.
• M/C Partners, a Boston-based private equity and venture capital firm, raised $350 million for its latest fund, M/C Partners VIII.
• Octopus Ventures, the European venture capital firm that’s part of Octopus Group, raised £83 million ($108 million) for a growth fund.
• Hamilton Lane promoted John Brecker, Katie Moore, Nayef Perry, and Masayoshi Yazawa to managing director. It also promoted Kristin Jumper, Samantha Leandri, Chenkay Li, Lisa Powers, Adam Shane, and John Stake to principal.
• Timothy Wentink joined Twin Brook Capital Partners as a managing director.
• ParkerGale Capital named Jimmy Holloran as a principal.