Happy Monday, Term Sheet readers. Finance reporter Anne Sraders here, filling in for Lucinda while she takes a well-deserved break.
Startups usually don’t leap at the chance to talk about their competitors—in fact, many often position themselves as the sole company doing what they do.
But the CEO of Europe’s third most valuable startup is not shying away from the “Stripe competitor” label it’s often given. No—he’s owning it.
“Yes we are a Stripe competitor and we’re really the only one,” Guillaume Pousaz, founder and CEO of U.K. payments startup Checkout.com, told me last week via email: “Because we’re a full stack payment technology company,” which provides payments services, fraud protection, and payout capabilities for its merchants, “with [two-thirds] of our 1,400 employees working in product and tech and growing at about 1,000 new people per year. Most others are legacy payment providers.”
But those like Matt Harris, a partner at Bain Capital Ventures focused on fintech, don’t quite see it as any one startup versus Stripe. “I think to make the claim that you represent their only competition, I’d say, misses quite a few boldface names who are also in that ring,” Harris tells me. Among those in that “ring”? Dutch payments firms Adyen (which is publicly traded) and Mollie (which is private, and worth some $6.5 billion).
Now, it’s not hard to see why companies like Checkout.com might not mind the comparison to the larger payments firm: Stripe is the world’s second most valuable startup, with a whopping $95 billion valuation. Beloved by developers and startups, it’s become a huge player in the payments space and a darling in tech circles. Which does have me wondering: has Stripe’s reputation in the startup world become so vaunted that competitors aren’t trying to fight the comparisons—or, for some, are even embracing them?
This idea of hitching a ride on a tech success story is not a new phenomenon with Stripe: In the 90s, Harris says, it was Microsoft, and before that, IBM. For the fintech space broadly, he argues “it’s an excellent framing device if you want to get investors excited, if you want to get your employees motivated, like, ‘it’s a two horse race and we’re gonna win.’ But I suspect the horse, only whose tail you can see from where you are, [isn’t] thinking as much about you as you are about them.”
In that sense, I also wonder if Stripe is so far ahead in their space that they’re the benchmark, for better or worse, for everybody who competes with them—à la Microsoft.
Of course, there’s space for multiple fintechs to exist in the multi-trillion dollar payments world. And Checkout.com’s CEO (like others who have been tagged with the Stripe comparison) is also clear about why he believes his business is unique: Pousaz says where Checkout is “different” is their focus on enterprise clients (versus small businesses) and global markets, offering a “consultative approach” with their merchants. “Our job is to increase their revenues, not just process payments,” he told me.
But the fact that CEOs like Pousaz are summoning Stripe’s name says a lot about how entrenched the company, still technically considered a startup, has become.
And it’s possible Stripe might beat Checkout.com to the next step of maturation, too: Entering the public markets. Although I reported last week that Checkout.com hired Céline Dufétel, formerly the COO and CFO of T. Rowe Price, to join its C-suite, Pousaz told me Checkout isn’t “in a rush” for an IPO. Stripe, on the other hand, has reportedly hired a law firm ahead of a potential listing, Reuters reported last month.
Jessica Mathews compiled the IPO and SPAC sections of this newsletter.
- UpGrad, an India-based upskilling education platform, raised $185 million in funding over a few months this year. Temasek led the round and was joined by investors including World Bank’s International Finance Corporation and IIFL.
- Snorkel AI, a Palo Alto-based startup specializing in training machine learning systems, raised $85 million in funding. Addition and BlackRock led the round and were joined by investors including Greylock, GV (formerly Google Ventures), and Lightspeed.
- Cricket Health, a San Francisco-based healthcare company focused on kidney disease, raised $83.5 million in Series B funding. Valtruis led the round and was joined by investors including Oak HC/FT, Cigna Ventures, K2 HealthVentures, and Blue Shield of California.
- Cadence, a New York City-based healthtech company, raised $41 million in funding. General Catalyst and Thrive Capital led the round.
- Pintu, an Indonesia-based crypto exchange, raised $35 million in extended Series A funding. Lightspeed Ventures led the round and was joined by investors including Alameda Ventures, Blockchain.com Ventures, Castle Island Ventures, Coinbase Ventures, Intudo Ventures, and Pantera Capital.
- Moove, an Africa-based mobility startup focused on flexible car rentals for drivers for companies like Uber, raised $23 million in Series A funding. Speedinvest and Left Lane Capital led the round and were joined by investors including DCM, Clocktower Technology Ventures, thelatest.ventures, LocalGlobe, Tekton, FJ Labs, Palm Drive Capital, Roka Works, KAAF Investments, Spartech Ventures, Class 5 Global, and Lendable co-founder Victoria van Lennep.
- Verifiable, an Austin-based healthcare tech infrastructure company, raised $17 million in Series A funding. Jack and Sam Altman led the round and were joined by investors including Craft Ventures, Flexport’s Ryan Petersen, Rippling’s Parker Conrad, Front’s Mathilde Collin, Syapse’s Jonathan Hirsch, Todd Goldberg, Rahul Vohra, and Tiger Global.
- Xayn, a Berlin-based private internet search browser, raised $12 million in Series A funding. Global Brain Corporation led the round and was joined by investors including Earlybird VC.
- LawVu, a New Zealand-based software platform for in-house law teams, raised $17 million NZD (around $11.9 million) in Series A funding. Insight Partners and AirTree Ventures led the round.
- SIGA OT Solutions, an Israeli cybersecurity firm focused on industrial assets, raised $8.1 million in Series B funding. PureTerra Ventures led the round and was joined by investors including SIBF, Moore Capital, and Phoenix Contact.
- Codelicious, a Carmel, Ind.-based coding and computer science curriculum, raised $3.8 million in seed funding. EduLab Capital Partners and Allos Ventures led the round and were joined by investors including Sixty8 Capital, GRE Capital, and Elevate Ventures.
- Cent, a San Francisco-based platform for NFT creators, raised $3 million. Investors included Galaxy Interactive, Jeffrey Katzenberg, Mark Pincus, Reid Hoffman, will.i.am, and In/Visible Ventures.
- Morrisons agreed to a takeover offer from a consortium led by SoftBank-owned Fortress Investment Group for £6.7 billion ($9.3 billion). However, Clayton, Dubilier & Rice was granted until Aug. 20 to submit a counter offer.
- The reinsurance arm of Brookfield Asset Management agreed to acquire American National Group, a Galveston, Texas-based insurance provider, for $5.1 billion in cash.
- Wrench Group, backed by Leonard Green & Partners, acquired Boothe’s Heating, Air & Plumbing, a Hollywood, Md.-based HVAC business. Financial terms weren't disclosed.
- A company controlled by the Permira funds agreed to acquire a majority stake in Engel & Völkers, a Germany-based property brokerage. Part of the company’s management team and the Völkers family will keep nearly 40% of the company’s shares. Financial terms weren’t disclosed.
- Bessemer Investors acquired Legacy Restoration, a Plymouth, Minn.-based residential and commercial exterior remodeling services provider. Financial terms weren’t disclosed.
- John Deere agreed to acquire Bear Flag Robotics, a Newark, Calif.-based autonomous tractor startup backed by investors including True Ventures, for $250 million.
- Honor Technology, backed by investors including Andreessen Horowtiz and Baillie Gifford, acquired Home Instead, an Omaha, Ne.-based home care company backed by Thomas Point Capital. Financial terms weren't disclosed.
- Bansk Group agreed to acquire Arcadia Consumer Healthcare, a Bridgewater, N.J.-based consumer over-the-counter medicines, supplements, and vitamins provider, from Avista Capital Partners. Financial terms weren’t disclosed.
- Cargill and Continental Grain Co. agreed to acquire Sanderson Farms, a Laurel, Miss.-based poultry processor, for roughly $4.5 billion in cash.
- Philip Morris raised its bid price for Vectura, a U.K.-based asthma drugmaker, to 165 pence per share, valuing its shares at roughly $1.4 billion.
- National Australia Bank will acquire Citigroup's Australian Consumer Bank for around A$1.2 billion ($882 million).
- Macquarie Asset Management agreed to acquire a majority stake in Southern Water, a U.K.-based water utility provider, for roughly £1 billion ($1.4 billion).
- Rekor Systems (NASDAQ: REKR) agreed to acquire Waycare Technologies, a Tel Aviv-based traffic management systems provider that uses predictive analytics, for $61 million in cash and common stock.
- Virgin Atlantic Airways Ltd., a United Kingdom-based airline, is weighing an IPO in London, per Bloomberg.
- ByteDance, the company behind video-sharing platform TikTok, is planning to IPO in Hong Kong by early 2022, per the Financial Times. The company had put a pause on its plans to go public in July.
- Eliem Therapeutics, a Redmond, Wash.-based nervous system biotech company, now plans to raise up to $75 million in an offering of 6 million shares priced at $12.50 per share—it had previously planned to price its shares between $17 and $19. The company reported a net loss and comprehensive loss of $20.7 million in 2020 and has yet to post revenue. RA Capital and research charity LifeArc back the firm.
- Enact Holdings, a mortgage insurance and lending company, re-filed for an initial public offering after pausing its IPO plans in May. The company posted $1.1 billion in revenue in 2020 and net income of $370 million. Enact Holdings is a subsidiary of life insurance company Genworth Financial.
- Cloud Village Inc., a music streaming service owned by Chinese internet tech company NetEase, is postponing its Hong Kong initial public offering, according to Bloomberg.
- Banyan Acquisition Corp., a blank check company focused on the foodservice industry, plans to raise $300 million in an initial public offering. The SPAC is led by former TriMark USA CEO Jerry Hyman and former Focus Products Group CEO Keith Jaffee.
- Uncork Capital, a Palo Alto, Calif.-based venture investor, promoted Andy McLoughlin to managing partner. He will share the role with Jeff Clavier. Susan Liu from Scale and Tripp Jones from August were also added as partners.
- Matthieu Hafemeister, a partner at Andreessen Horowitz specializing in fintech, is leaving to join Jeeves, a fintech infrastructure company.
- AirTree, an Australian venture capital firm, promoted Elicia McDonald and Jackie Vullinghs to partners.
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