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Let’s Talk About SoftBank’s Second Vision Fund: Term Sheet

Softbank Chairman Masayoshi Son Speaks To The PressSoftbank Chairman Masayoshi Son Speaks To The Press
SoftBank founder Masayoshi Son will use the IPO to raise capital for investments in tech startups Tomohiro Ohsumi—Getty Images

And here it is … the early development of what is bound to be a sequel to SoftBank’s debut $100 billion Vision Fund. 

SoftBank is expected to pump $40 billion into its second technology-focused megafund after securing backing from an unlikely group of investors, according to The Wall Street Journal.

Apple, Goldman Sachs, and Standard Chartered are amongst some of those investors. SoftBank is also reportedly in talks with Microsoft to invest in the fund. SoftBank executives told Microsoft that they would encourage the fund’s portfolio of roughly 75 companies to transition away from Amazon Web Services to Microsoft’s cloud platform Azure, according to the story. 

I’m actually quite surprised by the investors interested in participating in Vision Fund 2.0, but it’s a good lesson in how quickly narratives turn. Not so long ago, Softbank was under fire after it was revealed that Saudi Arabia provided more than half of the capital in its debut Vision Fund. (The CIA concluded that Crown Prince Mohammed bin Salman ordered the murder of journalist Jamal Khashoggi.) 

I thought that the scandal had the power to freeze SoftBank out of deals, affect future Vision funds, or even tarnish Masayoshi Son's reputation. Turns out, it really didn't. DFJ’s Heidi Roizen made a good point about all the outrage during our interview in December

"I think it’s fascinating that we’re focused on Saudi Arabia because of the unique circumstances around the murder of Jamal Khashoggi. And yet, if we’re really going to draw the line on all transgressions of human rights, there’s a long list of those."

So perhaps that’s behind some of the thinking of the new investors. In fact, Saudi Arabia has indicated they are likely to invest again, though at a lower level than the $45 billion it contributed last time, according to The WSJ. 

It’s also important to note that for some of these companies and banks, an investment is what it costs to gain access to an ecosystem of high-flying companies you can do business with. And what do you do when only SoftBank holds the key?

DIDI FUNDING: Toyota Motor Corp. will invest $600 million in Didi Chuxing, China’s largest ride-hailing company. The deal with Didi follows the company’s investments last year of $500 million in Uber and $1 billion in Southeast Asia’s Grab. This is another step in Toyota’s journey to evolve beyond just car manufacturing. Read more.

THE HANDMADE EMPIRE: Etsy, the e-commerce site for handmade and craftsy goods, has had quite the journey. The company, which launched in 2005, has earned cultlike devotion from sellers and buyers alike for its “keeping commerce human” ethos and its focus on small vendors rather than big corporate conglomerates. But Etsy is enjoying a striking turnaround, thanks in part to an effort to give customers the consistent, reliable experience they’d expect from … a big corporate conglomerate. Read Fortune’s feature here.

HOUSEKEEPING: I’ll be out of the office tomorrow and Monday, so my colleague Lucinda Shen will be in charge of compiling the deals and keeping you up to date. Please send deals and scoops her way at lucinda.shen@fortune.com.

VENTURE DEALS

Gusto, a San Francisco-based developer of a payroll solution for small and medium-sized businesses, raised $200 million in Series D funding. Investors include Fidelity Management & Research Company, Generation Investment Management, Dragoneer Investment Group, General Catalyst and T. Rowe Price Associates Inc

Amp Americas, a Chicago-based company focused on the renewable transportation fuel industry, raised $75 million in funding. EIV Capital led the round.

CircleCI, a San Francisco-based continuous integration and delivery platform, raised $56 million in Series D funding. Owl Rock Capital Partners and Next Equity co-led the round, and were joined by investors including Scale Venture Partners, Top Tier Capital, Threshold Ventures (formerly DFJ), Baseline Ventures, Industry Ventures, Heavybit, and Harrison Metal Capital. 

Standard Cognition, a San Francisco-based developer of an AI shopping & checkout system for retail, raised $35 million in Series B funding. EQT Ventures led the round, and was joined by investors including Initialized Capital, CRV and Y Combinator. 

AeroSafe Global, a Rochester, N.Y.-based developer of aerogels and aerogel related materials for temperature-sensitive shipping needs, raised $31.5 million in funding. Investors include Peloton Equity LLC, Hamilton Lane and Flexstone Partners.

Aura, a San Francisco-based financial technology company that offers affordable loans to families, raised $28.7 million in funding, from Angel Island Capital.

Hipcamp, a San Francisco-based online marketplace for campsites, raised $25 million in funding. Andreessen Horowitz led the round.

Drip Capital, a Palo Alto and Mumbai-based provider of a trade financing product that targets small to medium-sized businesses in developing markets, raised $25 million in Series B funding. Accel led the round.

vCita, a Bellevue, Wash. and Tel Aviv-based provider of cloud-based, business management solutions for small businesses, raised $15 million in funding. Forestay Capital led the round.

Quiq, a Bozeman, Montana-based conversational engagement platform and business messaging solutions provider, raised $12.5 million in Series B funding. Foundry Group led the round, and was joined by investors including Teamworthy Ventures and existing investors Venrock and Next Frontier Capital.

Bravado, a San Francisco-based community of sales professionals, raised $12 million in funding. Investors include Redpoint Ventures and Freestyle Capital.

Agrivida, a Medford, Mass.-based agricultural biotech firm, raised $8 million in funding. Investors include Open Prairie, ARCH Venture Partners, Batios Holdings Limited, Cultivian Sandbox, Syngenta Ventures, Maschhoff’s Agricultural Holdings and Middleland Capital.

Bobo’s, a Boulder, Colo.-based natural food company and maker of freshly-baked whole grain snacks, raised $5.5 million in Series B1 funding. BFG (Boulder Food Group) led the round, and was joined by investors including Ridgeline Ventures and BIGR Ventures. 

Wisely, a Canada-based philanthropic fundraising enablement platform, raised $1.15 million in seed funding. Ripple Ventures led the round, and was joined by investors including Verstra Ventures and the Maple Leaf Angels. 

Xain, a Germany-based blockchain and AI startup, has secured an undisclosed amount of funding. The investor was Dominik Schiener, co-founder of IOTA.

HEALTH AND LIFE SCIENCES DEALS

TScan Therapeutics, a Boston-based company that designs therapies that reprogram a patient’s own T cells, raised more than $48 million in Series B funding. Investors include Bessemer Venture Partners, Google Ventures, Longwood Fund and Novartis Venture Fund.

Tivic Health Systems, a Menlo Park, Calif.-based bioelectronic medical device company that treats chronic conditions, raised $8 million in funding. Investors include Sand Hill Angels, Astia Angels, Golden Seeds, HBS Angels, Sierra Angels, Lateral Capital and Skylight Investments.

PRIVATE EQUITY DEALS

ClearSky acquired Altamira Technologies Corporation, a McLean, Va.-based provider of analytics and engineering solutions to the U.S. national security community. Financial terms weren’t disclosed. 

Xenon Partners acquired Scout APM, a San Francisco-based provider of application performance management software. Financial terms weren’t disclosed. 

Aurora Capital Partners acquired Cold Chain Technologies, a Franklin, Mass.-based provider of single-use and reusable passive thermal packaging solutions. Financial terms weren’t disclosed. 

IPOs

Wanda Sports Group, a Beijing-based sporting and live events firm spinning out of Dalian Wanda Group, now plans to raise $280 million in an IPO of 28 million shares priced between $9 to $11. It booked revenue of $1.3 billion in 2018 and income of $61.9 million. It plans to list on the Nasdaq as “WSG.” Read more.

Health Catalyst, a digital records health firm, raised $182 million in an IPO of 7 million shares priced at $26, above its estimated range. The firm posted revenue of $112.6 million and loss of $62 million in 2018. Norwest (20.9% pre-offering), Sequoia (21.9%), and UPMC (6.3%) back the firm. It plans to list on the Nasdaq as “HCAT.” Read more.

Sunnova Energy, a residential solar system company in the U.S., raised $168 million in an offering 14 million shares priced at $12, the low end of its range. The firm posted revenue of $118 million in 2018 and loss of $74.2 million. Energy Capital Partners backs the firm. It plans to list on the NYSE as “NOVA.” Read more.

ProSight Global, a Morristown, N.J.-based specialty insurer, raised $110 million in an IPO of 7.9 million shares (45% insider selling) priced at $14, a downsized IPO at the low end of its range. Goldman Sachs and TPG back the firm. The firm posted revenue of $785.9 million in 2018 and income of $55.3 million. It plans to list on the NYSE as “PROS.” Read more.

EXITS

Zambon will acquire Breath Therapeutics, a Germany-based clinical stage biopharmaceutical company, from Sofinnova Partners for up to €500 million ($556 million).

FIRMS + FUNDS

The CapStreet Group, a Houston-based private equity firm, raised $408.15 million for its fifth fund, according to an SEC filing. The target is almost $500 million.

VMG Partners, a San Francisco-based private equity firm, raised $250 million for its new fund, VMG Catalyst.

BGV, a Palo Alto, Calif.-based venture capital firm, raised $70 million for its Opportunity Fund.

PEOPLE

Yukon Partners promoted David Sampair to principal and Andrew Walker to vice president. 

FirstMark Capital named Adam Nelson as a partner.

Jessica Straus joined Dundee Venture Capital as a venture partner.