What is one man’s loss is another man’s gain.
That dynamic was front and center for Facebook as it went down for hours on Monday in a self-inflicted failure—a failure that came coincidentally as a whistleblower, Frances Haugen, outed herself around the same time with damaging accusations against the company, alleging that it put profits ahead of safety.
The company was left reeling as investors, consumers, and politicians turned up the heat on the business.
But as the company lost billions in dollars in market value, other social media businesses gained—reinforcing a thesis for some venture investors that the growing scrutiny against the tech giants would be fertilizer for a crop of less established peers.
Privacy-focused messaging app Telegram for example said it gained a “record” 70 million in new users, while Signal also reported millions in new sign-ups. Both Snapchat and Twitter got a boost, according to data from Sensor Tower. And apparently, as Facebook’s own internal platforms also went down, employees there turned to competing chat channels like Discord and LinkedIn. By one measure, Facebook’s extended downtime might have cost the company about $100 million in revenue.
Now the question is, will users stick to these alternatives with Facebook’s various social media apps—Instagram, Whatsapp, and Messenger—back up and running?
Still, there is irony here too: The downage has served to emphasize the scale of Facebook’s reach. Even as its users flooded a bevy of other communication channels and startups, Google users experienced a slowdown due to a surge in traffic, while Telegram too confirmed a similar issue.
SOFTBANK INVESTS IN ANOTHER ZUM(E): SoftBank-backed robotics-pizza company, Zume shuttered that part of its business last January as part of a broader implosion of its portfolio at the time. On Wednesday, the Japanese tech giant’s Vision Fund led a $130 million round into a startup with a very similar name—but in a different business.
School bus ridesharing company Zūm announced that it had reached a $930 million valuation after coming back from a pandemic that doused its revenue. Also backed by investors including Sequoia Capital and BMW iVentures, the company plans to lease a fleet of electric buses for schools in the country to use. Read more.
AN AUTISM CARE UNICORN: Elemy, a San Francisco-based company focused on online and in-home pediatric behavioral care—including Autism—has raised $219 million. The Series B funding round values the business at $1.2 billion. SoftBank Vision Fund 2 led the round and was joined by investors including Goodwater Capital and Premji Invest. That comes as health tech startups at large are becoming larger with a strategy of focusing on specific conditions.
BRAIN DRAIN: Apologies for an error in yesterday’s newsletter. In a portion pointing to Rent the Runway’s slow recovery in subscribers compared to its pre-pandemic days, I mistakenly wrote that the company had 133,572 active subscribers by the end of Jan. 2019. That date should’ve been Jan. 2020.
Jessica Mathews compiled the IPO and SPAC sections of this newsletter.
- Tekion, a Pleasanton, Calif.-based automotive software provider, raised $250 million at a $3.5 billion valuation. Investors included Durable Capital Partners and Alkeon Capital Management.
- Personio, a Munich-based human resources startup, is seeking to raise $200 million for a round that would value it around $6 billion, per Bloomberg.
- Pattern, a Lehi, Ut.-based e-commerce and marketing company, raised $225 million. Knox Lane led the round, valuing it at $2 billion.
- mParticle, a New York City-based customer data orchestration company, raised $150 million in Series E funding. Permira’s growth fund led the round.
- Twin Health, a Mountain View, Calif.-based health services company, raised $140 million in Series C funding. Investors include ICONIQ Growth, Sequoia Capital India, Perceptive Advisors, Corner Ventures, LTS Investments, Helena and Sofina.
- Masterworks, a New York City-based fractional painting investment startup, raised $110 million in Series A funding, valuing it over $1 billion. Left Lane Capital led the round and was joined by investors including Galaxy Interactive and Tru Arrow Partners.
- Domino Data Lab, a San Francisco-based data science company, raised $100 million. Great Hill Partners led the round and was joined by investors including Coatue Management, Highland Capital Partners, and Sequoia Capital.
- Sure, a Santa Monica, Calif.-based insurance infrastructure company, raised $100 million in Series C funding valuing it at $550 million. Declaration Partners and Kinnevik led the round and were joined by investors including WndrCo, W. R. Berkley, and Menlo Ventures.
- The Mom Project, a Chicago-based recruitment firm focused on moms, raised $80 million in Series C funding. Leeds Illuminate led the round and was joined by investors including 7GC, Initialized Capital, OCA Ventures, Citi, High Alpha, Grotech Ventures, and Silicon Valley Bank.
- Bolder Industries, a Boulder, Colo.-based company converting end-of-life tires into petrochemicals, steel, raised $80 million. CIM Group and Aravaipa Ventures led the round and were joined by investors including Tauber Oil.
- Aquant, a New York City-based customer service analytics company, raised $70 million in Series C funding. Qumra Capital, Insight Partners, and Pitango Growth led the round and were joined by investors including Lightspeed Venture Partners and Angular Ventures.
- Honor Technology, a San Francisco-based senior care network, raised $70 million in Series E funding valuing it over $1.3 billion. Baillie Gifford led the round and was joined by investors including T. Rowe Price Associates, Home Instead founders Paul and Lori Hogan, Prosus Ventures, Andreessen Horowitz, Thrive Capital, FMZ Ventures, Rock Springs Capital, Lighthouse Capital Markets, and TriplePoint Capital.
- Huboo, a U.K.-based e-commerce warehousing and fulfillment company, raised £60 million ($81.4 million) in Series B funding. Mubadala Capital led the round and was joined by investors including Stride, Ada Ventures, Hearst, Episode 1, and Maersk Growth.
- CRM&BONUS, a Brazilian giftback platform, raised BRL 280 million (about $50 million), valuing the business at about BRL 1 billion ($181 million). SoftBank Latin American Fund, Riverwood Capital, Igah Ventures, and Volpe Capital invested.
- Wizard, a New York City-based company for shopping via text, raised $50 million in Series A funding. NEA led the round and was joined by investors including Accel and Marc Lore.
- Olea Edge Analytics, an Austin-based edge computing company focused on the water utility industry, raised $35 million in Series C funding. Insight Partners led the round.
- Neural Magic, a Somerville, Mass.-based A.I. software company focused on deep learning inference, raised $30 million in Series A funding. NEA led the round and was joined by investors including Andreessen Horowitz, Amdocs, Comcast Ventures, Pillar VC, and Ridgeline Ventures.
- Adaptive Shield, an Israel-based cybersecurity company, raised $30 million in Series A funding. Insight Partners led the round and was joined by investors including Okta Ventures and Vertex Ventures Israel.
- Trybe, a Brazilian edtech, raised BRL 145 million ($27 million) in Series B funding. Base Partners and Untitled led the round and were joined by investors including XP, Global Founders Capital, Endeavor Scale Up Ventures, Verde, Luxor, and Hans Tung. It values the business around $252 million.
- Favo, a Brazilian social commerce platform, raised $26.5 million in Series A funding. Tiger Global Management led the round and was joined by investors including GFC, Elevar Equity, Kevin Efrusy, David Velez, FJ Labs, and H2O.
- Kingdom Supercultures, a New York City-based food plant-based food company using microbial cultures, raised $25 million in Series A funding. Shine Capital led the round and was joined by investors including Valor, Tao, Lux, SALT, Reference, and Digitalis.
- Pandion, a Seattle-based maker of a shipping network for e-commerce and online retailers, raised $22.5 million in Series A funding. Telstra Ventures led the round and was joined by investors including Bow Capital, Playground Global, Schematic Ventures, AME Cloud Ventures, and Innovation Endeavors.
- Thyme Care, a Nashville Tenn.-based provider of oncology care , raised $22 million in funding. Andreessen Horowitz led the round and was joined by investors including AlleyCorp, Frist Cressey Ventures, Casdin Capital, and Bessemer.
- Tesis Labs, a Phoenix-based genetic sequencing company, raised $20 million valuing it at $520 million. The round was led by Xcellerant 1 TLC.
- Cover Whale Insurance Solutions, a New York City-based insurtech focused on the auto space, raised $15.5 million. Investors include the Ambac Financial Group (NYSE:AMBC) and TigerRisk Partners’ Applied Financial Technologies subsidiary.
- ReleaseHub, a San Francisco-based staging management company, raised $20 million in Series A funding. CRV led the round and was joined by investors including Sequoia, Y Combinator, Bow Capital, Artisanal Ventures, and Hack VC.
- CarbonBuilt, a Los Angeles-based carbon dioxide capture tech maker, raised $10 million in Series A funding. Grantham Environmental Trust’s Neglected Climate Opportunities led the round and was joined by investors including Jeremy Pritzker, Lime Street Ventures, Climate Capital, YouWeb IV: Impact, and Foundamental.
- Autify, a software testing company, raised $10 million in Series A funding. World Innovation Lab led the round.
- Muon Space, a Mountainview, Calif.-based satellite constellation company, raised $10 million in seed funding. Costanoa Ventures led the round and was joined by investors including Space Capital, Congruent VC, Ubiquity Ventures, South Park Commons, and Climactic VC.
- Memgraph, a London-based streaming graph application company, raised $9.3 million in seed funding. M12 led the round and was joined by investors including Heavybit Industries, In-Q-Tel, Counterview Capital, ID4 Ventures, and Mundi Ventures.
- Appsmith, an India-based maker of software to build internal applications, raised $8 million in Series A funding. Canaan Partners led the round and was joined by investors including Accel Partners, Bessemer Venture Partners, OSS Capital, Prasanna Sankar, and Rippling.
- Podcastle, an Armenian podcasting service for creators, raised $7 million. RTP Global and Point Nine led the round and were joined by investors including S16 VC, Sierra Ventures, and AI Fund.
- Rendered.ai, a Bellevue, Wash.-based physics-based synthetic data company, raised $6 million in seed funding. Space Capital led the round and was joined by investors including Tectonic Ventures, Congruent Ventures, Union Labs, and Uncorrelated Ventures.
- Cala, a Paris-based autonomous restaurant chain, raised €5.5 million in seed funding. BACKED VC led the round and was joined by investors including Possible Ventures, Kima Ventures, Quiet Ventures, and Acequia Capital.
- Assembly, an Austin-based virtual meals company, raised $1.8 million in seed funding. Wilshire Lane Partners and Acrew Capital led the round and were joined by investors including Chris Altchek of Lightspeed Venture Partners.
All Star Auto Lights, a portfolio company of Atlantic Street Capital, acquired Jante Wheel and Perfection Wheel,
- Arsenal Capital Partners and Linden Capital Partners completed a majority recapitalization of BioIVT, a Westbury, New York-based provider of biological specimens. Financial terms weren't disclosed.
- Blackwell Capital Group acquired Stack Equipment, a Hartford, Wis.-based supplier of refurbished equipment for aerial and material handling. Financial terms weren't disclosed.
- Graycliff Partners recapitalized CHawk, a Hayward, Calif.-based maker of plastic and metal components. Financial terms weren't disclosed.
- PDQ.com, a portfolio company of TA Associates, acquired SimpleMDM, a Portland, Or.-based Apple device management platform. Financial terms weren't disclosed.
- Revalize, a TA Associates portfolio company, acquired Sofon, a Netherlands-based provider of pricing software. Financial terms weren't disclosed.
- Raptor Technologies, backed by Thoma Bravo and JMI Equity, acquired CPOMS, a U.K.-based student safeguarding software company. Financial terms weren't disclosed.
- TPG Capital acquired a majority stake in Nintex, a Bellevue, Wash.-based process management and automation company. Thoma Bravo will retain a minority interest. Financial terms weren't disclosed.
- UniversalCIS, backed by Lovell Minnick, merged with Credit Plus, a Salisbury, Md.-based provider of mortgage verifications and business credit reports. Financial terms weren't disclosed.
- Valor Healthcare, a portfolio company of Trive Capital, acquired CRAssociates, a Springfield, Va.-based provider of outpatient clinics for veteran affairs medical centers. Financial terms weren't disclosed.
- Verdant Specialty Solutions, a portfolio company of OpenGate Capital, acquired Baze Chemical, an Odessa, Texas-based ethoxylate specialty chemical company. Financial terms weren't disclosed.
- Wellbeam Consumer Health, backed by American Pacific Group, acquired TruSkin, a Seattle-based skincare brand. Financial terms weren't disclosed.
- Apax along with Oak HC/FT will acquire Eating Recovery Center, a provider of eating disorder and mood and anxiety treatment in the U.S., from CCMP Capital. Financial terms weren't disclosed.
- Epsylite Holdings, a portfolio company of Balmoral Funds, acquired StyroChem Canada, a Canadian maker of expandable polystyrene products, from PMC Capital Partners. Financial terms weren't disclosed.
- GoTo Global Mobility, backed by WeWork co-founder Adam Neumann, will acquire Emmy, a Berlin-based ride-sharing company. Emmy is backed by investors including BonVenture. Financial terms weren't disclosed.
- Industrial Growth Partners acquired APCT, a maker of printed circuit board prototypes headquartered in Silicon Valley, from Angeles Equity Partners. Financial terms weren't disclosed.
- Evolent Health (NYSE:EVH) acquired Vital Decision, an Edison, N.J.-based provider of advance care-planning services, from WindRose Health Investors. Financial terms weren't disclosed.
- Anheuser-Busch InBev is weighing a sale of some of its German beer brands, including Franziskaner Weissbier, Hasseroeder, and Spaten, for about € 1 billion ($1.2 billion), per Bloomberg.
- LVMH acquired Officine Universelle Buly 1803, a French cosmetics and perfume business. Financial terms weren't disclosed.
- Southwest Gas (NYSE:SWX) agreed to acquire Questar Pipelines from Dominion Energy (NYSE: D) for nearly $2 billion, despite protests from activist investor Carl Icahn.
- SunPower (Nasdaq: SWPR) acquired Blue Raven Solar, an Orem, Ut.-based residential solar company, for $165 million in cash.
- A group of investors including Apinder Singh Ghura, Amarjit Singh Grewal and KJR Brothers will acquire French Connection, the clothing retailer, for about 29 million pounds ($40 million).
- Icade Santé, a French real estate developer, has postponed its IPO in Paris, per Reuters.
- Chronext, a Swedish luxury watch marketplace, is postponing its IPO, per Bloomberg.
- HireRight Holdings, a Nashville, Tenn.-based workforce risk management and compliance solution company, filed for an IPO. The company posted $540 million in revenue in 2020 and a net loss of $92 million. General Atlantic and Stone Point Capital back the firm.
- AirSculpt Technologies, a Miami Beach, Fla.-based body contouring company, filed for an IPO. The company posted $63 million in revenue in 2020 and reported net income of $8 million. Vesey Street Capital Partners backs the firm.
- Main Capital Partners, a European software investor, raised €1.2 billion across two funds.
- MPM Capital, a Cambridge, Mass.-based investment firms, raised $850 million for its second Oncology Impact Fund.
- NFX, a San Francisco-based venture investor, raised $450 million for its third fund focused on pre-seed and seed-stage startups.
- Crossbeam Venture Partners, a New York City-based venture investor, named Ryan Morgan as a managing director.
- Lightspeed, a Menlo Park, Calif.-based venture investor, is hiring an investor to join its consumer team.
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