Refactor Capital Co-Founder David Lee Steps Away, Becomes Chairman: Term Sheet for Thursday, May 2
Refactor Capital is ready for round two. The early-stage venture capital firm is raising $30 million for its second fund, according to an SEC filing. The fund will continue to focus on deals in the biology and health space and cut checks of an average size of $1 million.
But there was one big, noticeable thing missing from the filing — Refactor co-founder David Lee’s name. Term Sheet has learned that Lee is not staying on for Refactor’s second fund. He will take a chairman role and hand the reins over to his partner Zal Bilimoria.
The firm, which launched in 2016, was jointly led by Lee and Bilimoria. You might remember that Lee, a former Google executive, co-founded SV Angel with Ron Conway in 2007. He resigned suddenly in 2015 and later sued Conway for breach of contract and unpaid fees.
Before Refactor, Bilimoria was a partner at Andreessen Horowitz for three years where he helped launch the firm’s bio fund. As a result of Lee’s departure, he will become the sole general partner at the firm.
So what happened?
A potential Refactor limited partner told Term Sheet they suspected the reason for Lee’s split is because his “health and energy isn’t where it needs to be a GP in this fund and he’s starting his retirement.” Lee told me he is not departing over health issues, but rather because he wants to focus on making personal investments, advising founders, and spending all of his time in Los Angeles (Refactor is based in Burlingame, Calif.).
“There’s a very different type of energy required for hunting down and leading deals. He can focus on his personal interests with less stress,” says one person familiar with the firm.
Lee will make a personal investment in Refactor’s second fund, and he will have economics even though he will not be making investments out of the vehicle. He provided the following statement to Term Sheet:
“I’m proud of the great work Zal and I have accomplished at Refactor since we launched three years ago. As Refactor begins to raise our second fund, I’m going to transition from Managing Partner to the role of Chairman. Becoming Chairman will keep me involved with Refactor, and also allow me to spend more time in Los Angeles, work more closely with current Refactor portfolio founders and pursue new adventures. Zal has a great track record as an investor, and I look forward to seeing Zal lead the Refactor mission from here.”
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BLOWING SMOKE: Imagine this: One day you’re filing for bankruptcy, the next you’re seeking a $5 billion valuation. That’s what happened with NJOY. The e-cigarette maker is in the process of raising roughly $300 million in funding that would value it at as much as $5 billion, according to The Wall Street Journal.
That’s a pretty remarkable development given the fact that NJOY filed for bankruptcy protection three years ago due to heavy debt and plummeting sales. But now, in this brave new vaping world we live in, its sleek lower-priced vaporizer is gaining traction and wooing smokers who might have otherwise gone with Juul. Read more.
• Glovo, a Spain-based mobile delivery company, raised €150 million ($169 million) in Series D funding. Lakestar led the round.
• VideoAmp, a Los Angeles-based advertising technology firm, raised $70 million in funding. The Raine Group led the round.
• Aryaka, a provider of software-defined network connectivity, raised $50 million in Series F funding. Goldman Sachs Private Capital Investing led the round.
• Indio Technologies, a San Francisco-based insurance technology company that streamlines the business insurance application process, raised $20 million in Series B funding. Menlo Ventures led the round, and was joined by investors including 8VC.
• DivvyCloud, an Arlington, Va.-based provider of security and compliance automation for public cloud and container infrastructure, raised $19 million in funding. Providence Strategic Growth led the round with participation from MissionOG and RTP Ventures.
• Awair, a developer of intelligent air quality monitors for homes and enterprise, raised $10 million in Series B funding. The Westly Group led the round, and was joined by investors including Altos Ventures, Emerson Electric, iRobot and Nuovo Capital.
• Intellimize, a Burlingame, Calif.-based website personalization company, raised $8 million in Series A funding. Amplify Partners led the round, and was joined by investors including Homebrew and Precursor Ventures.
• Golden, a San Francisco-based self-constructing knowledge database built by artificial and human intelligence, raised $5 million in seed funding. Andreessen Horowitz led the round.
• PeopleGrove, a San Francisco, Calif.-based online platform that connects students with alumni and mentors, raised $4.7 million in Series A funding. Reach Capital led the round, and was joined by investors including Bisk Ventures, Collaborative Fund, GSV Acceleration, Launch Capital, Riverpark Ventures, and University Ventures.
• Editional, a New York-based startup connecting creators and collectors of digital collectibles, raised $1.5 million in seed funding. Investors include ConsenSys Ventures, Digital Currency Group, and CoinFund.
• GFA International, a Delray Beach, Fla.-based engineering and geological consulting firm, raised funding of an undisclosed amount. Investors include Palm Beach Capital.
PRIVATE EQUITY DEALS
• Bain Capital Private Equity agreed to acquire a majority stake in Imperial Dade, a Jersey City, N.J.-based distributor of disposable food service and janitorial supplies. Financial terms weren’t disclosed.
• AUA Private Equity made an investment in Gourmet Culinary, a holding company focused on acquiring stakes in specialty food manufacturers in the U.S. Financial terms weren’t disclosed.
• Young Innovations, a portfolio company of The Jordan Company, acquired Crystal Tips, an Irvine, Calif.-based supplier of disposable air/water syringe tips and adapters. Financial terms weren’t disclosed.
• VersaFlex, which is backed by DalFort Capital Partners, acquired Specialty Products, a Lakewood, Wash.-based maker of spray-applied polyurea elastomers, polyurethane foams and custom plural component equipment. Financial terms weren’t disclosed.
• Engage2Excel Group of Companies, a portfolio company of Comvest Partners, acquired Rideau Inc, a Canada-based provider of employee recognition solutions. Financial terms weren’t disclosed.
• Openforce, a portfolio company of Riverside Partners, acquired Flexible Workforce LLC, a Brentwood, Ind.-based vendor management platform for the courier, last mile and logistics segments. Financial terms weren’t disclosed.
• Madison Dearborn Partners made an investment in Lightspeed Systems, an Austin-based educational technology solutions provider. Financial terms weren’t disclosed.
• AMN Healthcare Services Inc agreed to acquire Advanced Medical Personnel Services Inc, a healthcare staffing firm, for $200 million.
• Lightyear Capital agreed to acquire Engage PEO, a Fort Lauderdale, Fla.-based provider of HR outsourcing solutions to small and mid-sized businesses. Financial terms weren’t disclosed.
• Edward Don & Company, which is backed by Vestar Capital, acquired Myers Restaurant Supply, a Santa Rosa, Calif.-based provider of food service equipment and design-build services. Financial terms weren’t disclosed.
• AE Industrial Partners acquired Alpine Air Express Inc, a Provo, Utah-based logistics and transportation platform providing regional air cargo services. Financial terms weren’t disclosed.
• BRP (TSX:DOO; NASDAQ:DOOO) agreed to acquire 80% of the outstanding shares of Telwater Pty Ltd, an Australia-based manufacturer of aluminum boats and trailers. Financial terms weren’t disclosed.
• Capsule Technologies, Inc acquired Bernoulli Health, a provider of medical devices. Financial terms weren’t disclosed.
• Beyond Meat, a Californian plant-based meat product maker, raised $241 million in an offering 9.6 priced at $25, the high end of its range. The firm posted revenues of $87.9 million in 2018 and loss of $29.9 million. Goldman Sachs, J.P. Morgan and Credit Suisse are underwriters. Kleiner Perkins (15.9% pre-offering), Obvious Ventures (9.2%), and DNS Venture Partners(9%) back the firm. It plans to list on the Nasdaq as “BYND.” Read more.
• So-Young International, a Beijing-based online plastic surgery marketplace, raised $179 million in an IPO of 13 million ADSs priced at $13.80 apiece. The firm posted revenue of $89.8 million in 2018 and income of $8 million. Matrix Partners, Trustbridge Partners, Apax Partners, and Orchid Asia back the firm. Deutsche Bank and CICC are underwriters. It plans to list on the Nasdaq as “SY.” Read more.
• TransMedics Group, an Andover, Mass.-based provider of system for organ transplants, plans to raised $91 million in an offering of 5.7 million shares priced at $16. Morgan Stanley and J.P. Morgan are underwriters. It plans to list on the Nasdaq as “TMDX.” Read more.
• Apax Partners, CPPIB and PSP Investments agreed to sell Acelity, Inc., a San Antonio, Texas-based medical technology company, and its KCI subsidiaries to 3M for $6.725 billion.
• One Rock Capital Partners acquired Process Solutions, a Greenville, S.C.-based manufacturer and material sciences company. The seller was Newell Brands. Financial terms weren’t disclosed.
FIRMS + FUNDS
• Cinven, a London-based private equity firm, raised €10 billion ($11.2 billion) for its seventh fund.
• Toyota AI Ventures, the venture capital arm of Toyota Research Institute, raised $100 million for its second fund.
• Pangaea Ventures, a Canada-based venture capital firm, raised $70 million for its fourth advanced-materials fund.
• MATH Venture Partners, a Chicago-based venture capital firm, raised $46 million for its second early-stage venture capital fund.
• Gauge Capital named Stan Dennis as managing director.