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Corporations are often dubbed fair-weather friends by the venture capital space. That’s proving untrue during the pandemic.
In 2020, funding in deals that involved a corporate VC rose to 24% to $40.2 billion, an all-time high, according to a new report from CBInsights. Much like the rest of the VC space, corporate investors focused their energies on late-stage bets: Participation in mega rounds of U.S.-based companies rose 54% to 109 in the year while the overall number of deals with CVC participation in U.S.-based companies fell from 1238 to 1211, per CBInsights’s 2020 Global CVC report.
But not everything stayed the same as before the pandemic: The coronavirus also seems to have reset some corporate priorities, globally speaking. Interest in A.I. and fintech companies waned in the year: Funding in the space with CVC backing dropped 2% and 14% respectively, per the report. In its place, digital health companies rose to become the favorite child. CVC-backed funding to such businesses soared 68% in the year to $8.8 billion.
Funding to cybersecurity startups, too, jumped in a year when many moved their entire lives online: CVC-backed funding to cybersecurity firms rose 31% to $3.8 billion.
GV, formerly known as Google Ventures, was the most active CVC in the year, followed by Salesforce Ventures and Intel Capital. Slack also tips into the list as the 10th most active investor for the year. It’ll be interesting to see how that plays into the Salesforce plan to acquire Slack for nearly $28 billion that is still pending.
Yes, funding dollars involving corporate venture capital backer fell following the 2008 financial crisis. But there’s a plethora of differences between today and 2008. The federal government moved faster and more aggressively than before to inject stimulus, softening the economic fallout of the pandemic. Much of the economic activity shifted or stayed alive online—and there is certainly more pressure for companies to invest in their digital chops. Meanwhile, interest rates are low, pushing investors to riskier assets. Today, the risk appears to be around sky-high valuations.
CANNABIS INVESTMENT: Dutchie, a Bend, Or.-based platform for cannabis dispensaries, raised $200 million in Series C funding, valuing it at $1.7 billion. Tiger Global led the round and was joined by investors including Dragoneer and DFJ Growth, Casa Verde Capital, Thrive Capital, Gron Ventures, and Howard Schultz, the former Starbucks CEO. Dutchie is also acquiring Greenbits and Leaflogix, two software companies also focused on the cannabis space. Greenbits in particular has raised funding from Tiger Global and Casa Verde Capital.
Lucinda Shen
Twitter: @shenlucinda
Email: lucinda.shen@fortune.com
VENTURE DEALS
- CRED, a Bangalore-based fintech, is reportedly raising $200 million at a $2 billion valuation, per TechCrunch. Read more.
- Unite Us, a New York-based enterprise tech company focused on the health and social care ecosystem, raised $150 million in a Series C funding. ICONIQ Growth led the round and was joined by investors including Emerson Collective, Optum Ventures, and Transformation Capital, Define Ventures, Salesforce Ventures, and Town Hall Ventures.
- Strive Health, a Denver-based kidney care delivery firm, raised $140 million in Series B funding. CapitalG led the round and was joined by investors including Redpoint, NEA, Town Hall Ventures, Ascension Ventures, and Echo Ventures.
- Nano Cures, an Austin-based clinical stage biotech and infectious disease immunity company, raised $90 million in funding. Opulence Capital Management led the round with $20 million.
- Genesis, a London-based software with an application platform for financial markets, raised $45 million in Series B funding. Accel led the round and was joined by investors including GV, Salesforce Ventures, Citi, Illuminate Financial, and Tribeca Venture Partners.
- Cyware, a New York-based cybersecurity company, raised $30 million in Series B funding. Advent International and Ten Eleven Ventures led the round and were joined by Prelude Fund, Emerald Development Managers, Great Road Holdings, and Zscaler.
- 100Plus, a San Francisco-based remote patient monitoring platform, raised $25 million in seed funding. Investors included Henry Kravis and George Roberts.
- EyeYon Medical, a Tel Aviv,-based developer of technologies for ophthalmic treatments, raised $25 million in Series C funding. Valuing the company at $36 million, CR-CP Life Science Fund led the round and was joined by investors including Global Health Sciences Fund (Quark Venture LP and GF Securities).
- Boson Protocol, a London-based, e-commerce-focused, blockchain company, raised $10 million. Investors included Outlier Ventures, FBG, TRG Capital, Duck DAO, Animoca Brands, Rarestone Capital, Masters Ventures, and Sparq Ventures.
- Stor.ai, a Tel Aviv-based digital commerce solution for grocers, raised $21 million in extended Series A funding. Meitav Dash and Mizrahi Tefahot led the round.
- Variantyx, a Boston-based hereditary disease testing company, raised $20 million in Series C funding. GHS Fund led the round and was joined by investors including IBM Ventures and Pitango Venture Capital, New Era Capital Partners, and 20/20 HealthCare Partners.
- Fondeadora, a Mexico City-based challenger bank, raised an additional $14 million in Series A funding. Investors included Portag3 and Gradient Ventures. Read more.
- Teramount, a Jerusalem-based optical connectivity solutions for ultra-high bandwidth applications, raised $8 million. Grove Ventures led the round and was joined by investors including Amelia Investments.
- 75F, a Minneapolis-based building management system, raised an additional $4.8 million in Series A funding. WIND Ventures led the round.
- Argon, a Tel Aviv-based cybersecurity startup, raised $4 million. Hyperwise Ventures led the round.
- Trullion, a New York and Tel Aviv-based financial workflow automation company formerly known as SMRT, raised $3.5 million in funding. Greycroft and Aleph led the round and was joined by investors including Verissimo Ventures.
- Tripscout, a New York-based travel recommendation platform, raised $2.3 million in additional seed funding. Corazon Capital led the round and was joined by investors including Accomplice, New Stack Ventures, MATH Ventures, and M25.
- Honeycomb Credit, a Pittsburgh-based loan crowdfunding platform, raised $1.8 million in seed funding. The American Family Insurance Institute for Corporate and Social Impact led the round.
- Nordetect, a Denmark-based agritech startup building portable water and soil testing solutions, raised $1.5 million in seed funding. Luminate NY led the round and was joined by investors including Rockstart, SOSV, PreSeed Ventures, and Vækstfonden.
- Gumroad, a San Francisco-based marketplace for creators, plans to raise as much as $6 million. It raised $1 million from investors including Naval Ravikant at a $100 million valuation and plans to raise the rest via crowdfunding. Read more.
PRIVATE EQUITY
- Blackstone Real Estate Partners and Starwood Capital agreed to acquire Extended Stay America, a Charlotte, N.C.-based operator of a hotel chain with long-term rental options, for about $6 billion.
- BC Partners is in talks to acquire Davies, a London-based insurance service firm, for about £1.2 billion ($1.7 billion) including debt, per Bloomberg. Read more.
- Four Winds Interactive, backed by Vista Equity Partners, is merging with Poppulo, an Ireland-based internal communications software maker. The deal values the combined business at $1 billion per Bloomberg. Read more.
- Inflow Communications, a portfolio company of Renovus Capital Partners, acquired PeakView, a Denver-based cloud adoption consulting firm. Financial terms weren't disclosed.
- Eyewitness Surveillance, backed by LLR Partners, will merge with Stealth Monitoring, a Hanover Md.-based video surveillance company backed by investors including Twin Point Capital. Financial terms weren't disclosed.
- Gen3 Marketing, a portfolio company of Longshore Capital Partners, acquired Optimus Performance Marketing, a U.K.-based marketing agency. Financial terms weren't disclosed.
- Pfingsten Partners invested in Omega Systems Consultants, a Reading, Pa.-based provider of IT solutions. Financial terms weren't disclosed.
- Strand Equity invested in Studio McGee, a Salt Lake City-based interior design firm. Financial terms weren't disclosed.
- Wellspring Capital Management recapitalized HealthPRO Heritage, a Health Valley, Md.-based provider of therapy solutions. Financial terms weren't disclosed.
- WHP Global, backed by Oaktree Capital Partners and BlackRock, acquired a controlling stake in Tru Kids, the parent company behind Toys "R" Us. Financial terms weren't disclosed.
EXITS
- Bridgepoint agreed to acquire Infinigate, a European software and sales distribution company, from H.I.G. Capital. Financial terms weren't disclosed.
- Quad-C Management acquired SEI Group, a Doraville, Ga.-based distributor and installer of residential building products, from Narrow Gauge Capital. Financial terms weren't disclosed.
- Cruise acquired Voyage, a Palo Alto, Calif.-based autonomous vehicle startup spun out of Udacity. Franklin Templeton backed Voyage. Financial terms weren't disclosed.
OTHER
- Rogers Communications agreed to acquire Shaw Communications, a rival Canadian telecom company, in a $16 billion deal.
- AbbVie is in talks to sell a portfolio of women’s drugs including the Lo Loestrin Fe birth control pill valued at $6 billion, per Reuters. Read more.
- Roche (SIX: RO) agreed to acquire GenMark Diagnostics (NASDAQ: GNMK), a Carlsbad, Calif.-based of diagnostic tests, for $ 1.8 billion.
- GFL Environmental (NYSE: GFL) agreed to acquire the solid waste and environmental solutions business of Terrapure Environmental for about C$927.5 million ($743 million).
- InPost agreed to acquire Mondial Relay, a French logistics firm, for about €565 million ($674 million). Read more.
- Robinhood agreed to acquire Binc, a recruiting firm. Financial terms weren't disclosed.
- Blend agreed to acquire Title365, a Lewisville, Tx.-based provider of title insurance and settlement services, from Mr. Cooper Group (NASDAQ: COOP).
- The Chinese government reportedly is calling for Alibaba (NYSE: BABA) to offload some of its media assets, including the South China Morning Post, per Bloomberg. Read more.
IPO
- Deliveroo, the U.K.-based food delivery company, plans to raise £1 billion ($1.4 billion) in its London IPO.
- Sprinklr, a New York-based software company, filed confidentially for an IPO. Its investors include JC2 Ventures and Iconiq Capital.
- National Grid, the Philippines-based power company, is seeking to raise $1.5 billion at minimum in an IPO in the nation, per Bloomberg. A deal would value the firm at between $8 billion to $10 billion. Read more.
- GV Gold PJSC, a Russian gold miner, is planning to raise $500 million via an IPO in the country. BlackRock backs the firm. Read more.
- Fortegra Group, a Jacksonville, Fla.-based specialty insurer, filed to raise up to $100 million. Read more.
SPAC
- EToro, a London-based stock trading platform, is in talks to go public with FinTech Acquisition V, a SPAC backed by dealmaker Betsy Cohen. A deal could value the firm at $10 billion, per Bloomberg. Read more.
- AltC Acquisition, a SPAC from dealmaker Michael Klein and former Y-Combinator President Sam Altman, filed to raise up to $1 billion.
- Brigantine Acquisition and Mistico Acquisition, the sixth and seventh SPACs from True Wind Capital both looking for a target in tech, filed to raise $600 million and $400 million respectively.
- Cerberus Telecom Acquisition II, a SPAC by Cerberus Capital Management, filed to raise $500 million.
- Decarbonization Plus Acquisition IV, a SPAC by Riverstone targeting a business in the clean tech space, filed to raise $350 million.
- Vector Acquisition IV, a SPAC from Vector Capital seeking a tech target, filed to raise up to $350 million.
- H.I.G. Acquisition II, a SPAC by H.I.G. Capital, filed to raise up to $300 million.
- Transformational CPG Acquisition, a SPAC from former executives at Bank of America and Carlyle focused on consumer investments, filed to raise $300 million.
F+FS
- Pathway Capital Management, an Irvine, Calif.-based firm, raised $1 billion for Pathway Co-investment Partners Fund V.
