Blackstone is hunting heads and cutting checks as it doubles down on tech
Good morning, Term Sheeters. This is Fortune finance reporter Rey Mashayekhi, filling in again for Lucinda.
The Blackstone Group is, by most measures, the largest private equity firm in the world. Yet in past years, as competitors like KKR and TPG ramped up efforts in the vaunted technology, media, and telecom (TMT) sector, Blackstone remained more focused on brick and mortar—becoming perhaps the largest commercial real-estate landlord in the world in the process. (Such is real estate’s importance to the firm that it chose to elevate Jonathan Gray—Blackstone’s former global head of real estate, who masterminded its world-beating strategy in the sector—to the rank of president and COO in 2018.)
But these days, there’s been a slight recalibration at the firm. Blackstone is now scaling up its operations on the tech side—staffing up with new hires who are well-versed in the TMT sector, and pursuing an array of tech-related investments in areas as diverse as health care, data centers, and social networking.
Monday’s announcement that Blackstone has lured former Amazon executive Christine Feng to the firm goes hand-in-hand with this new emphasis. In her new gig, Feng—who specialized in mergers and acquisitions at Amazon Web Services, and previously held a similar role at Microsoft—will focus on tech sector investments through the firm’s Tactical Opportunities platform.
Feng arrives a few months after Blackstone poached former KKR managing director Vini Letteri, who played a leading role in guiding KKR’s investments in growth-stage tech companies. Letteri now holds a senior role at Blackstone Growth, the firm’s own growth equity investing platform; Blackstone launched that platform in early 2019, having hired Jon Korngold away from General Atlantic to helm it.
Beyond talent, a raft of recent deals demonstrate Blackstone’s commitment to beefing up its presence in the tech space. In the past two years, it has acquired a majority stake in Thomson Reuters’ financial data unit, which it rebranded as Refinitiv; purchased mobile marketing platform Vungle for a reported $750 million; and picked up a majority interest in the startup that owns the popular dating app Bumble. This year, it has acquired health care technology firm HealthEdge Software and invested in Chinese data center provider 21Vianet.
Blackstone is poised to throw its considerable weight around in private equity tech investing in the years to come. Both Feng and Letteri are based in San Francisco, where Blackstone is actively looking to expand its footprint.
The world’s biggest private equity firm has its eyes firmly set on Silicon Valley; the rest of us would be wise to take notice.
Anne Sraders curated today’s Term Sheet.
-ShareChat, an India-based social media app, is in early talks with investors including Sequoia Capital to raise up to $200 million, Reuters reports citing sources. The deal could value ShareChat at $1 billion, Reuters reports. Read more.
-Rippling, a San Francisco-based payroll, benefits, and employee data management platform, raised $145 million in Series B funding. Founders Fund led the round, and was joined by investors including Greenoaks Capital, Coatue Management, Bedrock Capital, Kleiner Perkins, Initialized Capital, and Y Combinator.
-Sight Diagnostics, a Tel Aviv-based blood count analyzer developer, raised $71 million in Series D funding from investors including Koch Disruptive Technologies, Longliv Ventures and OurCrowd.
-Springboard, a San Francisco-based career mentoring platform, raised $31 million in Series B funding. Telstra Ventures led the round, and was joined by investors including Vulcan Capital, SJF Ventures, Costanoa Ventures, Pearson Ventures, Reach Capital, International Finance Corporation (IFC), 500 Startups, Blue Fog Capital, and Learn Capital.
-Zencity, a Tel Aviv, Israel-based AI-based provider of data to give local governments insights, raised $13.5 million in funding. TLV Partners led the round, and was joined by investors including Salesforce Ventures, Canaan Partners Israel (CPI), Vertex Ventures, Microsoft’s venture fund M12, and i3 Equity Partners.
-ROOM, a New York City-based company that makes portable phone booths, meeting rooms and other products for offices, raised $12.5 million in Series A funding. Slow Ventures led the round, and was joined by investors including SJF Ventures, Lerer Hippeau, and FJ Labs along with individual investors including Bjarke Ingels.
-Qualified, a San Francisco-based marketing platform that lets businesses chat with buyers on their sites, raised $12 million in Series A funding. Norwest Venture Partners led the round, and was joined by investors including Salesforce Ventures and Redpoint Ventures.
-Zibo, a Redwood City, Calif.-based platform for independent landlords to manage finances, raised $10.5 million in seed funding. Canaan Partners led the round, and was joined by investors including QED Investors, Khosla Ventures and SVB Capital.
-FleetOps, a Toronto-based AI-based freight marketplace that matches freight shipments with drivers, raised $6 million in seed funding. Inspired Capital and Resolute Ventures led the round, and were joined by investors including Hike Ventures, Basecamp Fund, Newark Venture Partners, BCF Ventures, Panache Ventures, and Brian Thomas.
-ANA Therapeutics, a Foster City, California-based biotech exploring a coronavirus treatment using niclosamide, raised $5 million in seed funding from investors including On Air Investments, Refactor Capital, SV Tech Ventures, SV Angel, SOSV, and several individual investors. Read more.
-Proper, a San Francisco-based accounting and bookkeeping service for property managers, raised $4.8 million in seed funding from investors including MetaProp, Expa and Bling.
-Goodfair, a Houston-based thrift shopping platform, raised $3.6M in seed funding. Imaginary led the round, and was joined by investors including MaC Venture Capital, Global Founders Capital, Willow Ventures, Watertower, Amplify.LA, Capital Factory and Texas Ventures.
-Gero, a Singapore-based AI platform focused on discovering drugs for anti-aging, raised $2.2 million in Series A funding led by Bulba Ventures.
-Cashdrop, a Chicago-based small business commerce platform, raised $2.7 million in seed funding. Harlem Capital led the round, and was joined by investors including Founder Collective, Long Journey Ventures and M25, and several individual investors. Read more.
-Blackstone Group agreed to acquire Ancestry.com, the Lehi, Utah-based DNA testing and heritage tracing company, from Silver Lake, GIC, Spectrum Equity, Permira, and other investors, for an enterprise value of $4.7 billion. Read more.
-Blackstone Group is joining Clearlake Capital Group and Insight Partners to invest in Diligent Corp., an executive and board communication software provider. The deal would value the company at over $4 billion, The Wall Street Journal reports citing sources. Read more.
-NZ Super Fund and Ontario Teachers’ Pension Plan split the purchase of Asia Pacific Healthcare Group, a New Zealand-based pathology services provider and healthcare business of Healthscope. The deal is valued at over NZD 550 million ($365 million). Read more.
-Peloton Capital Management, Heal Partners Trust, and other investors invested approximately $90 million in debt and equity in The Fertility Group, a Canada-based network of fertility clinics.
-Thoma Bravo agreed to acquire Foundation Software, a Strongsville, Ohio-based accounting and payroll software provider for construction. Financial terms were not disclosed.
-AA, a U.K.-based roadside assistance service and insurance company, has received three takeover offers from Platinum Equity Advisors, Centerbridge Partners Europe and Towerbrook Capital Partners together, and Warburg Pincus. Read more.
-EDBI invested in Vesta, a Lake Oswego, Ore.-based fraud protection and payments company. Financial terms were not disclosed.
-TruFood Manufacturing, backed by AUA Private Equity Partners, acquired Simply Natural Foods, a Commack, N.Y.-based maker of nutrition and healthier chocolate and diet bars. Financial terms were not disclosed.
-Gen Cap America acquired TFM Services, a Wichita, Kansas-based building maintenance company for janitor services, together with the company’s management. Financial terms were not disclosed.
-James Alpha Advisors acquired an interest in Easterly, an asset management firm with offices in Boston and New York. Financial terms were not disclosed.
-TSG Consumer Partners invested in American Technologies, an Anaheim, Calif.-based environmental restoration and disaster recovery firm. Financial terms were not disclosed.
-Teladoc Health agreed to buy Livongo Health, a Mountain View, Calif.-based platform for people to manage chronic diseases, and will merge for cash and stock valued at $18.5 billion.
-AlixPartners acquired Freeh Group International Solutions, a Wilmington, De.-based risk management firm founded by former FBI director Louie Freeh. Financial terms were not disclosed.
-TouchBistro acquired TableUp, a Boston-based guest retention and marketing platform aimed at improving customer loyalty for restaurants. Financial terms were not disclosed.
BREAKUPS, HANGUPS, AND BANKRUPTCIES
-Fieldwood Energy, a Gulf of Mexico-based offshore oil driller, filed for bankruptcy protection.
-RackSpace Technology, a San Antonio, Texas-based cloud hosting services provider, raised $704 million in an IPO in an offering of 33.5 million shares priced at $21. Apollo Management and Searchlight Capital back the firm. It plans to list on the Nasdaq as “RXT.” Read more.
-TWC Tech Holdings II, a San Francisco-based blank check company and second of its kind formed by True Wind Capital plans to raise up to $525 million in an IPO. It plans to target investments in technology. It plans to list on the Nasdaq as “TWCTU”. Read more.
-GO Acquisition, a New York City-based blank check company, raised $500 million in an IPO in an offering of 50 million shares priced at $10. It is targeting investments in travel. It plans to list on the NYSE as “GOAC.U”. Read more.
-BowX Acquisition, a Menlo Park, Calif.-based blank check company formed by Bow Capital Management, raised $420 million in an IPO in an offering of 42 million shares priced at $10. It plans to list on the Nasdaq as “BOWXU”. Read more.
-Yucaipa Acquisition, a Los Angeles-based blank check company formed by The Yucaipa Companies, raised $300 million in an IPO. It is targeting investments with strong sector growth and management, among other criteria. It is listed on the NYSE as “YAC.U”. Read more.
-Colonnade Acquisition, a West Palm Beach, Fla.-based blank check company, plans to raise up to $200 million in an IPO. It is targeting investments in energy, natural resources, real estate, and agriculture. It plans to list on the NYSE as “CLA.U” . Read more.
-FAST Acquisition, a New York City-based blank check company led by Ruby Tuesday founder Sandy Beall, plans to raise $200 million in an IPO. It is targeting investments in restaurants and hospitality. It plans to list on the NYSE as “FST.U”. Read more.
-Health Sciences Acquisitions 2, a New York City-based blank check company formed by RTW Investments, raised $139 million in an IPO in an offering of13.9 million shares, 1.4 million more than expected, priced at $10. It is targeting investments in biopharmaceuticals and medtech. It plans to list on the Nasdaq as "HSAQ". Read more.
-Alpha Healthcare Acquisition, a New York City-based blank check company, plans to raise up to $100 million in an IPO. It is targeting investments in healthcare. It plans to list on the Nasdaq as “AHACU”. Read more.
-Kio Networks, a Mexico-based data center provider backed by Tresalia Capital, is considering an up to $1 billion sale, Bloomberg reports citing sources. Read more.
-Raymond James added Jay Hernandez as a managing director and head of industrial technology. Hernandez was previously at Moelis & Company.
-Lincoln International added Emily Wildes and Roderick O'Neill as managing directors in its healthcare group.
-North Square Investments added Oran Walsh as a senior vice president. Walsh was previously at Backstop Solutions Group.