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Secretive Defense Tech Startup Anduril Reaches Unicorn Status: Term Sheet

Inside The Oculus VR Inc. "Step Into the Rift" EventInside The Oculus VR Inc. "Step Into the Rift" Event
Palmer Luckey, co-founder of Oculus VR Inc. and creator of the Oculus Rift. Bloomberg — Getty Images

Anduril, the secretive defense tech startup co-founded by Oculus founder Palmer Luckey and Founders Fund partner Trae Stephens, has raised new funding at a valuation of more than $1 billion, according to CNBC. Andreessen Horowitz is reportedly one of the investors who participated in the funding round. 

Since launching in 2017, Anduril has raised approximately $58.5 million in total venture funding (not including the latest raise) from investors including Founders Fund, 8VC, General Catalyst, XYZ Ventures, Spark Capital, Rise of the Rest, and SV Angel. It has more than 100 employees.

The company is working with the government as a complement to — or alternative for — Donald Trump's promised physical wall along the border with Mexico. It can detect and identify motion within a 2-mile radius. During a 10-week test period, the company helped customs agents catch 55 unauthorized border crossers.

Last year, Luckey and Stephens published a thought-provoking piece in The Washington Post called, ‘Silicon Valley should stop ostracizing the military.' In the op-ed, Luckey and Stephens argue that the tech industry has a responsibility to help the U.S. maintain its global lead. "If tech companies want to promote peace, they should stand with, not against, the United States' defense community," they write.

In a time when tech companies are turning down defense and border patrol contracts, Anduril and its investors are going all in. And there are still many unanswered questions.

As the pace of innovation accelerates, there are ethical challenges companies are facing — such as the development of AI-based weaponry, the dehumanization of decision-making, and the use of surveillance to collect and analyze mass amounts of data. I’ll be interested to learn how Anduril and its traditional tech investors plan to deal with these thorny issues.

BUSINESS & BASKETBALL: Three years ago, I wrote a story about two former high school basketball teammates, each of whom went on to build a billion-dollar company. Brian O’Kelley, the founder of AppNexus, and Miguel McKelvey, the co-founder of WeWork, were on the same basketball team at a public high school in Oregon. 

At the time my story was published in 2016, WeWork was valued at $16 billion, and AppNexus at $1.2 billion. Oh how times have changed. Fast-forward to today, WeWork is on its way to an IPO, and AT&T bought AppNexus for a reported $1.6 billion.

Now, O’Kelley is back as co-founder of a new company: CMDTY. CMDTY (yes, “commodity” without the vowels, sigh) is a company that aims to apply data and technology to the old-school industry of supply chain and logistics management. He and co-founder Andrea Aranguren have raised $10 million in funding from Venrock and Rucker Park. This is O’Kelley’s third startup. Before AppNexus, he sold his first company Right Media for $680 million to Yahoo in 2007. Read O’Kelley’s post about his new venture here.

REMEMBERING T. BOONE PICKENS: Over the years, Fortune has spilled barrels of ink over the legendary T. Boone Pickens. The oil tycoon was known as much for his unencumbered tongue as his ruthless business acumen. Once described by writer Joseph Nocera in Fortune as "the most feared and famous of the 1980s corporate raiders," Pickens built a longstanding reputation as a disruptor—and was the first so-called "raider" to make the cover of Fortune.

He passed away yesterday at his home in Dallas at age 91. In remembrance, Fortune revisited some of Pickens' most memorable quotes throughout our pages over the years. Here are several:

"I never liked being called a raider. I never destroyed anything."—Pickens, "Boone Speaks," Fortune, 1987

"If you don't watch out, you can set up a situation where a child never has the pleasure of bringing home a paycheck."—Pickens (on leaving only small trusts for his children), "Should You Leave it All To the Children?" Fortune, 1986

"Talking is the natural way to do business. Great things come from our luncheon meetings, which consist of a sandwich, a cup of soup, and a good idea or two. No martinis."—Pickens, "Boone Speaks," Fortune, 1987

Read more here.

VENTURE DEALS

Trifacta, a San Francisco-based provider of data wrangling, raised $100 million in funding. Investors include Telstra Ventures, Energy Impact Partners, NTT DOCOMO Ventures, BMW iVentures, ABN AMRO Digital Impact Fund, Accel Partners, Cathay Innovation, Google, Greylock Partners, Ignition Partners, and Infosys. Read more at Fortune.

SmartDrive Systems, a San Diego, Calif.-based video-based safety telematics and transportation intelligence, raised $90 million in funding. TPG Sixth Street Partners led the round.

Pomelo, a Thailand-based omnichannel fashion company, raised $52 million in funding. Investors include Central Group, Provident Growth Fund, InterVest Star SEA Growth Fund, Andre Hoffman, Toivo Annus, Lombard Private Equity, Ambient Sound Investments OU and The Luxembourg Company Deverel.

Akeneo, a France-based developer of product experience management solutions for corporate brands and retailers, raised $46 million in funding. Summit Partners led the round, and was joined by investors including Alven, Partech, and Salesforce Ventures.

Lacework, a Mountain View, Calif.-based security platform for enterprise innovation, raised $42 million in funding. Investors include Sutter Hill Ventures and Liberty Ventures.

Simbe Robotics, Inc, a San Francisco-based company focused on robotics and AI, raised $26 million in Series A funding. Venrock led the round, and was joined by investors including Future Shape, Valo Ventures, and Activant Capital. 

Echodyne, a Kirkland, Wash.-based maker of high-performance radars for government and commercial markets, raised $20 million in funding. Investors include Bill Gates, Madrona Ventures, NEA, Vulcan Capital, Lux Capital and Vanedge Capital.

Explorium, a San Francisco and Tel Aviv-based data science platform, raised $19 million in funding. Investors include Emerge, F2 Capital and Zeev Ventures.

Swiftly, a Seattle-based technology platform for supermarkets, raised $15.6 million in seed funding. Investors include Novel Private Equity, Mendacre and Ron Burkle. 

Incredible Health, a San Francisco-based healthcare hiring platform, raised $15 million in Series A funding. Andreessen Horowitz led the round, and was joined by investors including NFX, Obvious Ventures, and Precursor Ventures.

WaveOptics, a U.K.-based maker of waveguide displays, raised $13 million in Series C funding. Investors include Goertek and Hostplus.

Neighborhood Goods, a Dallas-based retailer, raised $11 million in Series A funding. Global Founders Capital led the round.

Replica, a San Francisco-based urban planning company, raised $11 million in Series A funding. Investors include Innovation Endeavors, Firebrand Ventures, and Revolution’s Rise of the Rest Seed Fund.

Redefine Meat, an Israel-based creator of animal-free meat using industrial 3D printers, raised $6 million in seed funding. CPT Capital led the round, and was joined by investors including Hanaco Ventures and The PHW Group.

vHive, an Israel-based software company that develops AI for multi-drone missions, raised $5.5 million in funding. Octopus Ventures led the round, and was joined by investors including StageOne Ventures.

Magic Spoon, a direct-to-consumer cereal brand, raised $5.5 million in seed funding. Lightspeed Venture Partners led the round, and was joined by investors including Collaborative Fund, Wild Ventures, DGNL Ventures, Joey Zwillinger, Jeff Raider, Dave Gilboa & Neil Blumenthal, Moiz Ali, Michael and Daniel Broukhim, Questlove, Rick Rubin, Kevin Rose, and Peter Attia.

Flatfile, a Denver-based developer of a platform to import data from any web application, raised $2 million in funding. Afore led the round.

Rammer.AI, a Seattle-based conversational intelligence platform, raised $1.8 million in seed funding. Flying Fish Partners led the round, and was joined by investors including Revel Partners.

HEALTH & LIFE SCIENCES DEALS

Anokion SA, a Switzerland-based biotechnology company, raised $40 million in funding. Investors include Versant Ventures, Novartis Venture Fund, Novo Ventures and Celgene. Financial terms weren’t disclosed. 

PRIVATE EQUITY DEALS

High Street Insurance Partners, which is backed by Huron Capital, acquired Ottawa Kent Insurance Agency, a Michigan-based outsourced risk management and independent insurance agency. Financial terms weren’t disclosed. 

Vision Innovation Partners acquired Washington Eye Specialists, a Washington D.C.-based ophthalmology practice. Financial terms weren’t disclosed. 

The Execu|Search Group, a portfolio company of New Heritage Capital, acquired TechLink, a New Jersey-based provider of temporary technology staffing solutions. Financial terms weren’t disclosed.

OTHER DEALS

Spotify acquired SoundBetter, a Brooklyn-based audio production and collaboration marketplace. Financial terms weren’t disclosed. 

FIRMS + FUNDS

Ardian, a France-based investment firm, raised $2.5 billion for its latest co-investment fund, Ardian Co-Investment Fund V.

Zebra Capital Partners, a Stamford, Conn.-based investment management firm, raised more than $404 million for its second fund, according to an SEC filing. The target is $700 million.

Franklin Templeton, a San Mateo, Calif.-based investment firm, raised more than $84.7 million for its Franklin Blackhorse venture fund, according to an updated SEC filing