A venture capitalist parodied by HBO’s ‘Silicon Valley’ is now facing criminal charges and perhaps even jail time

Mike Rothenberg is (quite literally) the stuff of an HBO television series.

The self-described “millennial venture capitalist” became known in Silicon Valley for spending lavishly at his seed-stage fund, Rothenberg Ventures. Justified as networking events expanded by Rothenberg’s own web of Ivy League alumni, the fund treated its invitees to luxury box seats at Golden State Warrior Games, hot-air balloon rides, and perhaps most famously of all, a day of batting practice and massages at what was then AT&T Park—the Giants’ stadium. 

That event was later inspiration for Silicon Valley, HBO’s comedy series that often pokes fun at venture capital culture, with Bloomberg then calling Rothenberg “The Valley’s Party Animal.”

His narrative may be taking on an even more dramatic turn in real life. 

On Friday, the Department of Justice alleged that Rothenberg had “fraudulently obtained at least $18.8 million through his illegal conduct,” tacking on a string of charges—with two bank fraud charges and the two false statement to a bank charges each carrying 30 years in prison at maximum.

According to the DoJ, Rothenberg obtained some of the funds for his venture capital firm by committing bank fraud and had used investor funding for personal use. In one case, the DoJ alleged that Rothenberg took excess fees from the venture firm and then faced a shortfall by the end of 2015 that he “did not wish to report.” The department further alleged that Rothenberg then sought to make up the shortfall by obtaining a $4 million line of credit by making false statements to a bank.

Early on, people questioned how exactly the fund, which raised $50 million between 2012 and 2016, was able to afford the parties and its undisciplined spending, which included BBQs with tutu-ed ponies. The firm had some notable investments, including in the likes of Robinhood, SpaceX, and Revel Systems, but concerns persisted. 

The Securities and Exchange Commission reached out to the firm following a whistleblower complaint in 2016 alleging client funding had been used for unintended purposes, with Rothenberg ultimately settling and neither admitting nor denying wrongdoing. Rothenberg did agree to be barred from the industry for five years in 2018, and a California federal court later called for him to pay $31.4 million to settle SEC allegations.

Rothenberg has not yet responded to a request for comment on the most recent charges.

VENTURES DEALS

- Xingsheng Youxuan, a Hunan, China-based grocery delivery company, is raising roughly $300 million at a $3 billion valuation from investors including Tencent and Primavera Capital, per Bloomberg. Read more.

- ^{Fivetran, an Oakland, Calif.-based provider of automated data integration, raised $100 million in Series C funding. Andreessen Horowitz and General Catalyst led the round and was joined by investors including CEAS Investments and Matrix Partners. Fivetran is now valued at $1.2 billion.}

- Freeline Therapeutics, a London-based biotechnology company focused on developing curative gene therapies for chronic systemic diseases, raised $80 million in extended Series C funding. Investors included Novo Holding A/S, Eventide Asset Management, Wellington Management Company, Cowen Healthcare Investments, Acorn Bioventures, and Ample Plus Fund. Syncona led its Series C in December.

- Artiva Biotherapeutics, a San Diego, Calif.-based developer of allogeneic natural killer cell therapies, raised $78 million in Series A funding. Investors include 5AM Ventures, venBio Partners, RA Capital Management, Medivate Partners, GC LabCell, and GC.

- solarisBank, a Berlin-based fintech for other financial services companies, raised $67.5 million in Series C funding at a post-money valuation of  $360 million. HV Holtzbrinck Ventures led the round, and was joined by investors including yabeo, Vulcan Capital, Samsung Catalyst Fund, and Storm Ventures. Read more.

- ^{Mynd Property Management, an Oakland, Calif.-based property management company, raised $41.5 million in Series C funding. Wells Fargo led the round and was joined by investors including Canaan Partners, Lightspeed Venture Partners, and Jackson Square Ventures.}

- Scalefast, a Los Angeles-based digital commerce solution, raised $22 million in Series B funding. Investors include Xplorer Capital, Stereo Capital, FJLabs, as well as current investors Benhamou Global Ventures, Crédit Mutuel Equity and Adara Ventures.

- Sundae, a San Francisco-based residential real estate marketplace, raised $16.6 million in Series A funding. QED Investors led the round and was joined by investors including Founders Fund and Susa Ventures.

- DigniFi, a Seattle-based financing platform for auto repairs and services, raised $14 million in Series A. BuildGroup led the round and was joined by investors including Exor Seeds.

- Hunters, a cybersecurity startup, raised $15 million in Series A funding. Investors include M12 and U.S. Venture Partners, with participation by seed investors YL Ventures, Blumberg Capital, and Okta Ventures.

- Upsolver, a software provider, raised $13 million in Series A funding. Vertex Ventures led the round and was joined by investors including Wing Venture Capital and existing investor Jerusalem Venture Partners.

- Aclamaint, a Chicago-based workflow solution for safety and risk management, raised $10 million in Series A funding. Mercury Fund led the round.

- Capital, a maker of an AI platform for startups to consider less-dilutive financing routes, raised $9 million in additional seed funding. AME Cloud Ventures led the round and was joined by investors including Future Ventures, Greycroft, Wavemaker Partners, and Partech. Read more.

- Sun Genomics, a San Diego, Calif.-based custom probiotics and gut health company,  raised $8.7 million in Series A funding. Pangaea Ventures led the round and was joined by investors including Danone Manifesto Ventures, SOSV, Human Longevity, and Nascita Ventures.

- Hi Marley, a Boston-based communication platform for insurance, raised $8 million in extended Series A funding. True Ventures and Underscore VC led the round and was joined by investors including Bain Capital Ventures and Greenspring Associates. 

- Zeller, a Melbourne, Australia-based alternative to business banking, raised $6.3 million in seed funding led by Square Peg.

- PlayBrain, a Tokyo-based esports content provider in Japan raised $6 million in Series A funding. Investors include BITKRAFT Esports Ventures.

- RIOS, a Palo Alto-based developer of AI-powered robots for assembly lines, raised $5 million in funding. Valley Capital Partners and Morpheus Ventures led the round and were joined by investors including Grit Ventures, Motus Ventures, MicroVentures, and Alumni Ventures Group. 

- Nacelle, a Los Angeles-based ecommerce developer platform, raised $4.8 million in funding. Index Ventures and Accomplice led the investments. Read more.

- Scurri, a Wexford, Ireland-based software provider for ecommerce, raised €1.5 million ($1.7 million) in funding. Investors include Act Venture Capital, Episode 1, and Pa Nolan.

- ThriveFantasy, a New York-based e-sports prop betting platform, raised $1 million in seed funding. Stage1 Ventures led the round and was joined by investors including New York Angels, New York Venture Partners, Han Park (former President of ESL) and Neil Sahota (IBM Master Inventor). 

PRIVATE EQUITY

- Coty, backed by KKR, will acquire 20% of Kim Kardashian West’s beauty line for $200 million. The deal values the company at $1 billion.

- The Carlyle Group will acquire Unison, a Dulles, Va.-based software maker for government agencies and contractors, from Abrys Partners. Financial terms weren't disclosed.

- Kinderhook Industries acquired Prairie Dog Pet Products, a Grand Prairie, Texas-based dog treats maker. Financial terms weren't disclosed.

- CoolSys, backed by Ares, acquired Richmond Refrigeration Service, an Ashland, Va.-based  commercial refrigeration and air conditioning service. Financial terms weren't disclosed.

- The Carlyle Group will acquire a majority stake in Envea, a French provider of environmental data processing and reporting. Financial terms weren't disclosed.

- INVL Baltic Sea Growth Fund acquired a controlling stake (52.81%) in Eco Baltia, a environmental management group for plastic recycling and waste collection in the Baltics. Financial terms weren't disclosed.

- KKR, Apollo Global , and J.C. Flowers are among the suitors for National Australia Bank's wealth management unit. Read more.

- Temasek and others invested $250 million in  BioNTech (NASDAQ: BNTX), a German company making an experimental vaccine against the coronavirus.

OTHERS

- Uber has made an offer to acquire Postmates, the delivery startup, the New York Times reports. Read more.

- Senator Investment Group and Bill Foley’s Cannae Holding offered $7 billion to acquire CoreLogic, an Irvine, Calif.-based real estate data company. Read more.

- An arm of Bharti Enterprises made an offer to acquire OneWeb, the bankrupt London satellite company backed by SoftBank. Read more.

- Ineos will acquire BP’s petrochemicals business for $5 billion. Read more.

- Warburg Pincus invested $90 million in equity and $310 million in convertible notes in WEX (NYSE:WEX), a Portland, Maine-based financial technology service provider.

BREAKUPS, HANGUPS, AND BANKRUPTCIES

- Seafolly, an Australian swimwear maker, filed for bankruptcy. L Catterton backed the firm.

- Cirque du Soleil Entertainment Group, the Candian circus operator, filed for bankruptcy protection. Read more.

- NPC International., one of the largest restaurant franchisees in the U.S., is preparing to file for bankruptcy, per the Wall Street Journal. Read more.

- Wirecard North America is seeking an acquisition to separate from Wirecard AG, the troubled German payments company.

IPOS

- Shift Technologies, a car-buying ecommerce platform, will go public by merging with Insurance Acquisition Corp. (Nasdaq: INSU), a SPAC. The SPAC will raise $185 million by selling its shares, valuing the combined company at $730 million on a pro forma basis. 

- Golden Nugget Online Gaming, an online-gaming company, will go public by merging with Landcadia Holdings II, a blank check company. The deal values it at $745 million.

- Velodyne Lidar, a maker of sensors used in self-driving vehicles, is in talks to merge with blank-check company Graf Industrial Corp, per Bloomberg. Velodyne is backed by the likes of Ford and Baidu. Read more.

EXITS

- Lululemon is acquiring Mirror, the at-home fitness startup for about $500 million. Mirror has raised some $72 million from investors including Lerer Hippeau, Spark Capital, and Point72 Ventures. Read more.

- CIVC Partners sold a majority stake in GPRS Holdings, a Toledo, Oh.-based provider of scanning services for subsurface infrastructure, to KKR. Financial terms weren't disclosed.

- Empower Retirement acquired Personal Capital, a wealth management platform, for $1 billion. Personal Capital investors included Venrock, IVP, and Crosslink Capital.

- Brainlab, acquired Level Ex, a Chicago-based company that creates medical video games. Level Ex has been backed by investors including JAZZ Venture Partners, 4490 Ventures, and OSF Ventures. Financial terms weren't disclosed.

F+FS

- Lightship Capital and SecondMuse launched a $50 million venture fund to invest in Midwest, minority-led startups.

- Summit Partners closed Europe Growth Equity Fund III with €1.1 billion and Summit Partners Venture Capital Fund V with $1 billion in commitments. 

PEOPLE

- Summit Partners added Melanie Whelan as a managing director focused high-growth consumer and technology-enabled services. Whelan was previously CEO of SoulCycle.