The lines between VCs and other investors are getting blurry

This week VC Twitter has been buzzing about one big announcement: Sequoia Capital, one of the most revered venture capital firms around, is shifting its model and creating The Sequoia Fund, an open-end fund (read: no 10-year fund cycle) for its U.S. and European investments. It will be an overarching fund composed of public stocks that will then feed capital into closed-end sub-funds that will make venture investments, according to the firm’s blog post.  

The move is interesting for several reasons, as Lucinda pointed out briefly on Wednesday. It will give the firm, among other things, more flexibility to enjoy the post-IPO returns of its portfolio companies and to support good founders throughout their companies’ public stage. In turn, LPs will also have a different payout structure—it seems they will have annual redemption rights instead of waiting for distributions at the end of a traditional 10 year cycle, per Axios. 

But the move is also a sign of the times, and the times, at the moment, are booming. 

The move is a function of a couple factors according to Santosh Rao, head of research at Manhattan Venture Partners, key among them: “The bull market. Right now, across the board, in the private markets and public markets and everywhere, it’s just been up, up, and up,” he says. There’s “a lot of crossover going on,” and Rao notes “it was going to happen anyway—the hunt for alpha is inevitably going to wherever there is excess alpha.”  

This isn’t a new trend. If you’ve been paying attention, you’ve surely noticed those dynamics are shaking up the more traditional structures of not only VC firms, but hedge funds, too.

What’s been increasingly happening in recent years is that hedge funds, which have largely (or, perhaps, traditionally) invested in public equities, are moving more of their cash into the private markets in search of attractive gains (just look at Tiger Global Management); while VC firms are holding public stocks (Sequoia, for example, already holds roughly $45 billion worth of U.S. and European public equities, according to Axios). 

To put some stats on it: In the first six months of 2021, hedge funds poured $153 billion across 770 deals with private companies, according to a Goldman Sachs report. That’s already more than they invested in all of 2020 ($96 billion across 753 deals), though still a small portion of the overall deals done. Meanwhile, many big VCs, including Andreessen Horowitz, General Catalyst, and now Sequoia, have become registered investment advisors (RIAs) in recent years in order to invest more of their funds into different assets outside their traditional purview (including crypto, public stocks, and secondaries).

The benefits for VCs are obvious, as many including Sequoia point out: the ability to hold on to good companies that see huge gains after they IPO or who are “not fully baked yet,” as Rao puts it. (Sequoia name checked one such company, Square, which partner Roelof Botha noted went from a $2.9 billion market cap at IPO to now over $120 billion, as of Thursday.) The crazy bull market of the past 19 months or so has perhaps put into question whether or not the best returns, especially for the growthy tech stars that have filled VC portfolios in recent years, are to be made before a company goes public. 

The upshot here is that, highlighted by moves like Sequoia’s, we’re seeing VC firms and hedge funds both taking on strategies that aren’t historically their status quo. I wager this dynamic will be even more interesting as hedge funds are increasingly competing with VCs for deals. 

The big question: Will a flood of VC firms join Sequoia? “Crossover funds are going to happen, investing across asset classes is going to happen, it’s already happening,” notes Rao (indeed, Sequoia already has one such crossover fund). But when it comes to asking LPs to invest in one big open-ended fund, “I think you really need the reputation behind that.” Sequoia certainly does. In fact, Sam Lessin, a general partner at Slow Ventures and an intern at The Information, writes for the publication that, “in truth, most don’t have the brand, LP relationships, or balance sheet to take the same step. I don’t think others will rush to adopt this model,” he argues. 

I, for one, am interested to see how this shakes out in the investment world—and if we’ll see a further blurring of the lines of what a traditional VC firm looks like (I suspect this is the case)—as returns, at least for now, can be found in many corners of the market.

NOT SO SWEET…GREEN: Salad food chain Sweetgreen filed for an IPO earlier this week, and as many folks on Twitter and elsewhere picked up on pretty quickly, Sweetgreen hasn’t been entirely honest about one key thing: its profitability. In fact, the company repeatedly told media outlets in recent years that it was profitable, while its S-1 filing tells another story: It’s posted annual losses since 2014. As my colleague Jessica Mathews reports, “It’s not uncommon for venture firms to allude to being more profitable than they are, according to David Trainer, CEO of New Constructs, an investment research company that analyzes IPO and stock valuations.”Afterall, who can forget WeWork’s “community-adjusted EBITDA”? 

If you’d like to continue to stay updated on the latest VC news and read more of Fortune’s finance coverage, we have a special offer exclusively for Term Sheet subscribers. Use this link and enter TERMSHEET to receive 50% off Fortune subscriptions.

Enjoy the weekend!

Anne Sraders
Twitter: @AnneSraders
Email: anne.sraders@fortune.com

Jessica Mathews curated today’s Term Sheet.

 VENTURE DEALS

- Impossible Foods, a Redwood City, Calif.-based plant-based meat alternative company, is in talks to raise $500 million in funding, which would value the company at $7 billion, per Bloomberg.

- Hinge Health, a San Francisco-based pain relief technology company, raised $400 million in funding via a Series E funding round led by Tiger Global and Coatue Management. In addition, Alkeon and Whale Rock purchased a $200 million stake via a secondary investment.

- ProLogium Technology, a Taiwanese battery maker, raised $326 million in funding from dGav Capital, Primavera, and SBCVC.

- ClickHouse, a San Francisco-based online analytical processing database management system company, raised $250 million in Series B funding led by Coatue and Altimeter and was joined by investors including Index Ventures, Benchmark, Lightspeed, Redpoint, Almaz, Yandex, FirstMark and Lead Edge. 

- Immunai, a New York City- based therapeutic discovery and drug development company, raised $215 million in Series B funding led by Koch Disruptive Technologies and was joined by investors including Talos VC, 8VC, Alexandria Venture Investments, Piedmont, and ICON.

- Ontra (formerly InCloudCounsel), a San Francisco-based contract automation and intelligence company, raised $200 million in Series B funding led by Blackstone and was joined by Battery Ventures.

- N!CK'S, a Swedish nutrition-focused ice cream company, raised $100 million in Series C funding led by Kinnevik, Ambrosia Investments, and Temasek and was joined by Gullspang.

- Purplle, an Indian online beauty product company, raised $75 million in a funding round led by Kedaara Capital.

- Awardco, a Provo, Utah-based employee rewards and recognition company, raised $65 million in Series A funding led by General Catalyst and Qualtrics co-founder Ryan Smith.

- Love, Bonito, a Singapore-based women’s fashion brand, raised $50 million in Series C funding led by Primavera Capital Group and was joined by investors including Adastria and Ondine Capital.

- UnitedMasters, a Brooklyn-based independent artist distribution company, raised $50 million in Series C funding led by Andreessen Horowitz.

- FemTec Health, a Houston, Tex.-based women's healthcare technology company, raised $38 million from investors including Longmont Capital, Ithaca LifeSciences, Unilever Ventures, Shiseido, e.Ventures, Viking Global, and Trinity Capital.

- Anomalo, a Palo Alto, Calif.-based data quality platform company, raised $33 million in Series A funding led by Norwest Venture Partners and was joined by investors including Two Sigma Ventures, Foundation Capital, First Round Capital and Village Global.

- Magnus Medical, a Burlingame, Calif.-based intractable neurological and psychiatric disorder treatment company, raised $25 million in series A funding led by JAZZ Venture Partners and Red Tree Venture Capital 

- SuperLayer, a San Francisco-based crypto venture studio that builds web3 projects, raised $25 million in funding from Marc Andreessen, Chris Dixon, Paris Hilton and Carter Reum, Richard Ma, Packy McCormick, Joe Montana, Brit Morin, Nas, Michael Ovitz, and Lenny Ratchitsky.

- Optina Diagnostics, a Montreal-based disease detection and diagnostics company, raised CAD $24.8 million ($20.1 million) in Series A funding led by DigitalDx Ventures and was joined by Boehringer Ingelheim.

- BrainBox AI, a Montreal-based autonomous building technology company, raised $24 million in Series A funding led by ABB and was joined by investors including Esplanade Ventures and Desjardins Capital.

- Rowan, a New York City-based piercing and jewelry company, raised $20 million in Series B funding led by VMG Partners and was joined by investors including Thirty Five Ventures, TABLE Management, Beechwood Capital, Silas Capital, and Goldcrest Capital. 

- ClearFlame Engine Technologies, a Geneva, Ill.-based green engine technology company, raised $17 million in Series A funding led by Breakthrough Energy Ventures and was joined by investors includiing Mercuria, John Deere and Clean Energy Ventures.

- RealEats, a Geneva, New York-based prepared meal delivery company raised $16.3 million in Series A funding led by Hamilton Lane on behalf of the New York State Common Retirement Fund and was joined by investors including GNC, Armory Square Ventures, and Excell Partners.

- Trellis Research, a Los Angeles-based state court research and analytics platform, raised $14.1 million in Series A funding led by Headline and was joined by investors including Calibrate Ventures, Okapi Ventures, Craft Ventures, and Revel Partners. 

- B-Secur, a Belfast-based electrocardiogram technology company, raised $12 million in funding led by First Capital Ventures.

- Vakilsearch, an Indian legal, compliance, and tax services platform, raised $10 million in Series B funding led by InCorp. Kalaari Capital will exit as part of the deal.

- Tilak Healthcare, a Paris-based medical game company, raised €7 million ($8.2 million) in funding led by Elaia and was joined by investors including Swen Capital Partners, Matmut Innovation, and iBionext Growth Fund.

- Gringo, a São Paulo-based car technology company, raised $8 million in a funding round led by Kaszek and was joined by GFC and OneVC.

- Gamma, a San Francisco-based productivity and slide deck replacement company, raised $7 million in seed funding led by Accel and was joined by investors including Jeff Weiner and Eric Yuan.

- APLYid, an Auckland, New Zealand-based ID verification company, raised $7m NZD ($5 million) in Series A funding led by Octopus Ventures.

- SocialChat, a San Francisco-based customer livestream and personalized shopping startup, raised $6 million in seed funding led by Race Capital and Gradient Ventures and was joined by investors including Twitch co-founder Kevin Lin, Agora.io founder Tony Zhao, former Lyft Chief Product Officer Ran Makavy, AfterPay global head of engagement Alanna Gregory, and Wish vice president of engineering Jack Xie. 

- GigLabs, an Atlanta-based blockchain and NFT company, raised $4.5 million in seed funding led by Dapper Labs and Panoramic Ventures and were joined by investors including Collab+Currency, Red Beard Ventures, Eterna Capital, Alumni Venture Group, Gaingels, and Amino Capital. 

- Cloudphysician, an Indian technology platform that connects remote critical care personnel to ICUs, raised $4 million in pre-Series A funding led by Elevar Equity. 

- Ladder, a San Francisco-based next generation professional community platform, raised $3.7 million in seed funding led by Forerunner Ventures and joined by investors including Seven Seven Six, Pear VC, Scribble Ventures, and Script Capital. 

- AutoFill Technologies, a South Holland-based data company that builds automated machine vision for fleets and rail, raised €2.6 million ($3 million) i pre-series A funding led by Innovation Industries and was joined by investors including Deeptech Labs, former Audi CEO Bram Schot, and former Microsoft president Rick Belluzzo.

- Ex Populus, a San Francisco, Calif.-based blockchain game publisher, raised $3 million in seed funding led by Animoca Brands and was joined by investors including CMS, Enjin, Infinity Ventures, Evernew, Polybius Capital, Decision Tree Ventures, Outlier Ventures and Zipmex.

- Relevnt, a Jacksonville, Fa.-based group messaging app, raised $2.5 million in seed funding led by Bruce Orr of Monterey Private Capital and Kirk Tovey of Globus Medical.

- Fleksy, a Barcelona-based virtual keyboard technology provider, raised $1.6 million in Series A funding led by Inveready and was joined by SOSV and Simile Venture Partners.

PRIVATE EQUITY

- Apax Partners acquired Homeowner Services Group, the residential home services unit of Camden, New Jersey-based American Water Works Company (NYSE: AWK) for approximately $1.3 billion in cash and debt.

- Audax Private Equity Partners invested in Stout, a Chicago-based investment bank and advisory firm. Financial terms weren't disclosed.

- Amulet Capital Partners acquired Remedy Health Media, a New York City-based health information platform. Financial terms weren't disclosed.

- BayPine agreed to acquire Pinnacle Dermatology Management, a Brentwood, Tenn.-based dermatology company. Financial terms weren't disclosed.

- Cuadrilla Capital acquired Agilence, a Mount Laurel, New Jersey-based data analytics and reporting solution for retail and restaurant companies. Financial terms weren't disclosed.

- An H.I.G. Capital affiliate made a strategic growth investment in 3Pillar Global, a Fairfax, Va.-based software product development company. Financial terms weren't disclosed.

- Insightsoftware, which is backed by Hg, said it would acquire Magnitude, an Austin, Tex. -based operational reporting and continuous intelligence company. Financial terms weren't disclosed.

EXIT

- The Cranemere Group acquired Outpatient Imaging Affiliates, a Franklin, Tenn.-based healthcare investment and development company, from ICV Partners for $400 million.

OTHERS

- EIG was shortlisted as a potential buyer of Aramco, Saudi Arabia’s gas pipelines company, in a deal that could be around $17 billion, per Reuters. 

- Covéa agreed to acquire PartnerRe, a Bermuda-based reinsurance company, from Exor NV for $9 billion in cash.

- Thoma Bravo completed its acquisition of Medallia, a San Francisco-based predictive insight software company, for $6.4 billion in cash.

- Zendesk agreed to acquire Momentive Global, the parent company of SurveyMonkey, for $4.13 billion in stock. 

- FirstCash agreed to acquire American First Finance, a Dallas-based alternative and traditional retail lending fintech, for $1.2 billion in cash and stock.

- Vistaprint acquired stock photo company Depositphotos and its graphic design subsidiary Crello, for $85 million.

- Coca-Cola is close to acquiring a controlling stake in BodyArmor, a Beverly Hills, Calif.-based sports drink company, per Bloomberg.

- Generali acquired a majority stake in Berkshire Hathaway-backed Cattolica Assicurazioni, an Italian insurance company, according to Dow Jones.

- LivePerson acquired VoiceBase, a Berkeley, Calif.-based voice analytics company, and TenFold, an Austin, Tex.-based customer experience integration company. Financial terms weren't disclosed.

- NI (Nasdaq: NATI) acquired NH Research, an Irvine, Calif.-based company that tests and measures electric vehicles and batteries, as well as Heinzinger GmbH’s EV Systems business. Financial terms weren't disclosed.

- ViacomCBS agreed to acquire a majority stake in film and entertainment companies Fox TeleColombia and Estudios TeleMexico from Walt Disney. Financial terms weren't disclosed.

IPO

- GlobalFoundries, a Malta. N.Y.-based semiconductor manufacturer, began trading yesterday after it and Mubadala Investment raised $2.6 billion in an offering of 55 million shares (40% sold by insiders) priced at $47 per share. The company reported $4.9 billion in net revenue in 2020 and a $1.4 billion net loss. Abu Dhabi’s sovereign wealth fund Mubadala owns the firm.

- Volvo Car Group, a Swedish-headquartered car company, started trading after raising $2.3 billion in an IPO in the country, per Bloomberg. Zhejiang Geely Holding Group owns the firm.

- Skechers USA, a Manhattan Beach, Calif.-based shoe company, is weighing an IPO, per Bloomberg. An IPO could raise about $1.5 billion.

- Full Truck Alliance, a Chinese digital commercial freight platform company, is weighing a secondary IPO in Hong Kong, per Reuters. An offering could raise around $1 billion.

- Huitongda Network, a Chinese e-commerce platform, may delay its IPO in Hong Kong until next year, according to Bloomberg. The offering could raise up to $1 billion. Alibaba Group backs the firm.

- Liftoff + Vungle, a Redwood City, Calif.-based mobile app marketing company, is weighing an IPO, according to Bloomberg. An offering could value the company at more than $10 billion. Blackstone backs the firm.

- Ebanx, a Brazilian payments company, confidentially filed for an IPO, per Bloomberg. The offering could happen as early as 2022 and may value the company at around $10 billion.

- Healthcare Royalty, a Stamford, Conn.-based mid-market royalty acquisition company, withdrew its IPO filing. It had planned to raise up to $797 million. The company posted investment income of $228.8 million in 2020. 

- HireRight Holdings, a Nashville, Tenn.-based workforce risk management and compliance solution company, raised $422 million in an offering of 22 million shares priced at $19 per share—it had previously planned to price shares at up to $24. 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.

- Udemy, a San Francisco, Calif.-based education platform, raised $421 million in an offering of 14.5 million shares priced at $29 per share. The company posted $430 million in revenue in 2020 and a net loss of $78 million. Insight Venture Partners, Prosus, Norwest Venture Partners, and Stripes Group back the firm.

- Desert Peak Minerals, a Denver, Colo.-based Permian Basin mineral and royalty interest manager, plans to raise up to $230 million in an offering of 10 million shares priced between $20 and $23 per share. The company posted $43 million in revenue in 2020 and reported a net loss of $14 million. Kimmeridge, Blackstone, and Oaktree Capital Management back the firm.

- Cian, a Russian online real estate classifieds platform, and its shareholders plan to raise up to $219 million in an offering of 18.2 million ADSs (78% sold by insiders) priced between $13.50 and $16 per ADS. The company posted $55 million in revenue in 2020 and reported a loss of $9 million. Elbrus Capital and Goldman Sachs back the firm.

- Entrada Therapeutics, a Boston, Mass.-based intracellular therapeutics company, raised $182 million in an offering of 9.1 million shares priced at $20 per share—it had previously planned to offer 7.5 million shares. The company reported a net loss of $27 million in 2020 and has yet to post revenue. MPM Capital, 5AM Ventures, Roche Venture Fund, and MRL Ventures Fund back the firm.

- Dash Brands, China’s Domino’s Pizza master franchisee, is weighing an IPO in Hong Kong that could raise around $100 million, per Bloomberg.

- Sonendo, a Laguna Hills, Calif.-based tooth decay medical technology company, raised $94 million in an offering of 7.8 million shares priced at $12 per share—it had previously planned to price shares at up to $17. The company reported $23 million in revenue in 2020 and a net loss of $47 million. General Atlantic, OrbiMed, Meritech Capital, and EW Healthcare Partners back the firm.

- Cadre Holdings, a Jacksonville, Forid.-based security products company, now plans to raise up to $81 million in an offering of 5.8 million shares priced between $12 and $14 per share—it had previously planned to raise up to $135.7 million. The company posted $404.6 million in net sales in 2020 and $38.5 million in net income.

- AirSculpt Technologies, a Miami Beach, Fla.-based body contouring company, raised $77 million in an offering of 7 million shares (69% sold by insiders) priced at $11 per share. The company posted $63 million in revenue in 2020 and reported net income of $8 million. Vesey Street Capital Partners backs the firm.

- Aura Biosciences, a Cambridge, Mass.-based cancer treatment targeted oncology platform, raised $76 million in an offering of 5.4 million shares priced at $14 per share. The company reported a net loss and comprehensive loss of $22 million in 2020 and has yet to post revenue. Medicxi, Matrix Capital Management, Surveyor Capital, Advent Life Sciences, and Lundbeckfonden Ventures back the firm.

- Agendia, an Amsterdam.-based breast cancer diagnostic and information solution for physicians, filed for an IPO in the U.S. The company reported $58 million of revenue in 2020 and a net loss of $20 million. Norgine Ventures, Athyrium Capital Management, and Korys back the firm.

- MDxHealth, a Belgian urologic solution diagnostics company, plans to raise up to $50 million in an offering of 3.8 million ADSs priced at $13.46 per ADS. The company posted $18 million in revenue in 2020 and reported $29 million in losses for the year. MVM Partners, Valiance Asset Management, and Soleus Capital Management back the firm.

- Rhodium Enterprises, a remote digital asset mining company, filed for an IPO. The company reported $48 million in net revenue for the six months ending in June 2021 and income of $15 million. Imperium Investments and Celsius back the firm.

- Intensity Therapeutics, a Westport, Conn.-based anti-cancer immune activation company, filed for an IPO. The company reported a net loss of $6 million in 2020 and has yet to post revenue. Portage Biotech backs the firm.

SPAC

- Terran Orbital, a Boca Raton, Fla.-based small satellite and earth observation solutions company, said it would go public via a merger with Tailwind Two Acquisition Corp., a SPAC. A deal values the combined entity at $1.6 billion. 

F+FS

- Marcy Venture Partners, Jay-Z’s San Francisco-based venture firm, raised $325 million for its second fund.