If anyone needed a reminder that regulators have their looming eyes on SPACs, Monday should have sufficed.
Digital World Acquisition Corp. (aka, the Trump SPAC), disclosed in an SEC filing that both the Financial Industry Regulatory Authority, which oversees the brokerage industry, and the SEC were nosing around, seeking info regarding the trading of its shares ahead of the blank check company’s merger announcement with Trump Media & Technology Group, the identification of certain investors, and other data. That same day, Lucid Group revealed the SEC was investigating the company in regards to its SPAC merger earlier this year and some of its projections and statements.
These requests are preliminary, and not necessarily indicative of anything gone awry. But there’s a common thread worth highlighting that runs between both of these deals: Meme stocks, anyone?
Churchill Capital Corp. IV, the blank check company that took Lucid Motors public this summer, wasn’t landing too much traction until it started picking up popularity from an interesting cohort: novice investors. In fact, it gained so much traction from retail investors that it struggled to get approval for the merger, as those same investors wouldn’t show up to vote. Shares of Digital World, lest we forget, skyrocketed 400% in value on the back of wild volatility that paused trading on Nasdaq the afternoon the firm announced its plans to take Trump Media & Technology Group public.
SEC Chair Gary Gensler has made it clear he’s a big proponent of clarifying what SPACs are allowed to do with investor money—and how incentives stemming from its structure may not always align with investors’ interests. And then, of course, there’s the matter of meme stocks and the “gamification” of stock trading, which has been on the regulatory agenda since the GameStop debacle at the onset of this year. So far, the regulator has yet to make or suggest any major changes.
But regulators don’t have to propose sweeping new rulemaking to send a message: Enforcement actions often suffice, and we’ve already seen some inklings of that. In July the SEC charged a blank check company, its sponsor, and its executives for making alleged “misleading claims.” Two months later it charged two individuals over an alleged meme stock fraud scheme.
Whether the latest SPAC probes turn into anything more serious or not, the SEC is asking questions, and you can bet other blank check companies are paying close attention.
Who run the world? Tech firms focused on women’s health or family benefits—called “femtech” companies—have reeled in almost double what they did last year, according to new research from S&P Global. Must be a good time to invest in women.
See you tomorrow,
Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
VENTURE DEALS
- YipitData, a New York-based market research company, raised $475 million in Series E funding led by Carlyle.
- Incode, a San Francisco-based identity verification and authentication platform, raised $220 million in Series B funding led by General Atlantic and SoftBank and was joined by investors including J.P. Morgan Technology Ventures, Capital One Ventures, and Coinbase Ventures.
- Pet Circle, a Sydney, Australia-based online specialty pet company, raised $125 million in Series C funding led by Prysm Capital and TDM Growth Partners and was joined by investors including Baillie Gifford and AirTree Ventures.
- Heap, a San Francisco-based digital insights platform, raised $110 million in Series D funding led by Sixth Street Growth and was joined by investors including Goldman Sachs Asset Management, NewView Capital, Menlo Ventures, DTCP, Triangle Peak Partners, Alliance Bernstein Private Credit Investors, Maverick Ventures, and The Private Shares Fund.
- Anyscale, a San Francisco-based platform to accelerate AI applications development, raised $100 million in Series C funding co-led by Andreessen Horowitz and Addition and was joined by investors including NEA, Intel Capital, and Foundation Capital.
- Liqid, a Broomfield, Co.-based data center composability company, raised $100 million in Series C funding co-led by Lightrock and affiliates of DH Capital and was joined by investors including Panorama Point Partners and Iron Gate Capital.
- everphone, a Berlin-based phone-as-a-service pioneer, raised $65 million in Series C funding led by Cadence Growth Capital.
- IRONSCALES, an Israeli email security solution company, raised $64 million in Series C funding led by PSG and was joined by investors including K1 Investment Management and Jump Capital.
- Hometap, a loan alternative company for home equity, raised $60 million in funding by American Family Ventures and was joined by investors including Bain Capital, ICONIQ Capital, G20 Ventures, Pillar, and General Catalyst.
- Platzi, a professional education platform in Latin America, raised $60 million in Series B funding led by Prosus and was joined by investors including Foundation Capital, Y Combinator, 500 Startups, FJ Labs, FundersClub, Hans Tung, and Darian Shirazi.
- ButterflyMX, an access control technology for housing properties, raised $50 million in funding led by JMI Equity and was joined by investors including Volition Capital, Egis Capital, and RiverPark Ventures.
- Hummingbird, a Walnut, Calif-based risk and compliance technology provider, raised $30 million in Series B funding led by Battery Ventures and was joined by investors including Flourish, Homebrew, FinVC, and Plaid co-founder William Hockey.
- Universe, a Brooklyn-based website and online store building app, raised $30 million in Series B funding led by Addition and was joined by investors including Google Ventures, Javelin Venture Partners, and Box Group.
- Majority, a Houston, Tex.-based mobile banking company for U.S. migrants, raised $27 million in Series A funding led by Valar Ventures and was joined by investors including Avid Ventures and Heartcore Capital.
- AI Fleet, a trucking carrier, raised $21 million in Series A funding led by Obvious Ventures and was joined by investors including Compound, Ibex Investors, and Tom Williams.
- Grip Security, a Tel Aviv-based SaaS security startup, raised $19 million in Series A funding led by Intel Capital and was joined by investors including YL Ventures.
- NetSpring, a Redwood City, Calif.-based operational intelligence platform raised $13 million in Series A funding led by Dell Technologies Capital and was joined by investors including Khosla Ventures and Wipro Ventures.
PRIVATE EQUITY
- Permira agreed to acquire Mimecast Limited, a London-based email security and cyber resilience company, for $5.8 billion in cash.
- Foreside Financial Group, backed by Genstar Capital, acquired Alaric Compliance Services, a New York-based regulatory and compliance services company.
- Salt Creek Capital acquired Endural, a Mesa, Calif.-based material handling container designer and manufacturer.
- Tech24, backed by HCI Equity Partners, acquired RMS Mechanical Services, an Ambridge, Penn.-based foodservice and commercial HVAC equipment repair, maintenance and installation company. Financial terms were not disclosed.
EXITS
- Onex agreed to acquire Tes Global, a London-based education technology services provider, from Providence Equity Partners. Financial terms were not disclosed.
IPOS
- LG Energy Solution, an energy company, plans to raise up to $10.8 billion in an IPO, according to Bloomberg. LG Chem is the firm’s parent company.
- Samsara, a San Francisco-based software startup, plans to raise up to $805 million in its IPO. Andreessen Horowitz backs the firm.
- FabIndia, an Indian clothing and furniture retailer, plans to raise up to $500 million in an IPO, per Bloomberg.
- Mobileye, a Jerusalem-based collision avoidance system company, plans to go public in mid-2022. Intel owns a majority stake in the firm.
SPAC
- Alvotech Holdings, a Reykjavík, Iceland-based biosimilar medicine developer and manufacturer, plans to go public via a merger with Oaktree Acquisition Corp. II, a SPAC sponsored by an Oaktree Capital Management affiliate. A deal values the company at $2.3 billion.
F+Fs
- PineBridge Investments, a New York-based asset manager, raised $334.3 million for a private equity fund.
- MTIP, a Swiss private equity firm, raised $250 million for its second fund.
- Flint Capital, a Boston-based venture capital firm, raised $100 million for its second fund.
PEOPLE
- Felix Capital appointed Susan Lin and Julien Codorniou as partners.
- BoxGroup added Claire Goldsmith as an investor from the Yale Investment Office, Dillon Liang as an investor from Bullpen Capital, and Sushanth Raman as an investor from Retool.
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