Good day. Last week, we asked what's top of mind for venture
investors as the fourth quarter approaches.
Kouki Harasaki, who focuses on health tech deals for Microsoft's
venture arm M12, said that in the fourth quarter he will be focused
on the exit market. "Will the IPO window continue to be as open in
Q4 and beyond?" Mr. Harasaki wrote. "If the IPO window begins to
narrow, then there will be a cascading negative impact to the
healthcare venture space."
Guru Chahal, a partner at Lightspeed Venture Partners, wrote
that the biggest challenge will be fast-moving investment rounds
where the valuation assumes perfect execution by the company. "This
creates tremendous pressure on companies to optimize growth at all
costs (quite literally)."
H/L Ventures managing partner Oliver Libby said pivotal issues
include the Delta variant, return to school, whether consumer and
ad spending have strong Q4s, the infrastructure and budget bills
and the exit market.
Steve Brotman, founding partner of Alpha Partners said there
will be opportunities in sectors such as machine learning,
enterprise software and fintech. But the flood of new capital in
venture will likely pump up valuations.
This week's question: Washington lawmakers are considering
measures aimed at lowering prescription drug prices. Do you think
these efforts are warranted, or do you have concerns about their
potential impact on venture investment in biotechnology?
Please email responses to marc.vartabedian@wsj.com.
And now on to the news...
Top News
Bracing for fallout. Chinese authorities are asking local
governments to prepare for the potential downfall of China
Evergrande Group, according to officials familiar with the
discussions, signaling a reluctance to bail out the debt-saddled
property developer while bracing for any economic and social
fallout from the company's travails, The Wall Street Journal's
Keith Zhai reports.
The officials characterized the actions being ordered as
"getting ready for the possible storm," saying that local-level
government agencies and state-owned enterprises have been
instructed to step in to handle the aftermath only at the last
minute should Evergrande fail to manage its affairs in an orderly
fashion.
They said that local governments have been tasked with
preventing unrest and mitigating the ripple effect on home buyers
and the broader economy, for example by limiting job losses --
scenarios that have grown in likelihood as Evergrande's situation
has worsened.
Ara Partners Raises $1.1 Billion for Second Decarbonization
Fund
Ara Partners has raised about $1.1 billion to invest in
businesses that help industries reduce carbon emissions, WSJ Pro's
Luis Garcia reports. The Houston-based firm said it wrapped up Ara
Fund II LP far above an initial $650 million target. Ara so far has
committed about a third of its new fund's capital across five
deals, according to Troy Thacker, a managing partner and co-founder
at the private-equity firm. Mr. Thacker said that the strong demand
for the fund reflected institutional investors' increased desire to
back businesses that help reduce pollution. Ara focuses on sectors
that include industrials and manufacturing, chemicals and
materials, energy efficiency, biofuels, food and agriculture.
New Platform Seeks to Bring IPO Market Into Digital World
A new technology platform backed by the biggest U.S. banks and
money managers is aiming to bring the IPO market into the 21st
century, WSJ reports. The syndicate desk -- a longtime fixture at
banks across Wall Street where IPOs and other large stock sales are
priced and allocated to investors -- has long clung to traditional
ways of doing business like phone orders and scribbled pieces of
paper, even as other businesses go digital. Capital Markets Gateway
LLC has set out to change that. Backed by Franklin Templeton,
Fidelity Investments, Goldman Sachs Group Inc., JPMorgan Chase
& Co. and Morgan Stanley, among others, CMG was launched in
2017 by former bankers at Robert W. Baird & Co.
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Industry News
Funds
Greylock Partners raised a $500 million fund dedicated to seed
investments. The new vehicle will typically write checks in the $2
million to $20 million range.
Intuit Inc. has launched a venture capital arm to make mostly
Series B and C investments focusing on fintech, virtual expertise,
consumer finance, omni-channel commerce, AI-enabled services and
crypto/DeFi. Intuit Ventures' inaugural investment was e-commerce
investor Clearco.
People
Crypto and blockchain investor CoinFund named David Pakman as
managing partner. He joins the firm after 13 years with Venrock.
CoinFund was founded in 2015 and is based in New York and
Miami.
Relay Ventures, which invests in mobility, proptech and fintech,
named Horace Dediu as partner and chief market strategist. He is
co-founder of Micromobility Industries and host of Micromobility
America. Founded in 2008, Relay Ventures has offices in Canada and
San Francisco.
Contract lifecycle management platform Ironclad Inc. appointed
Leyla Seka as chief operating officer and Helen Wang as chief
financial officer. Ms. Seka was previously a partner at Operator
Collective. Ms. Wang was most recently CFO at eBay Global Payments.
Early this year, San Francisco-based Ironclad raised a $100 million
Series D round from BOND, Lux Capital, Accel, Sequoia Capital, Y
Combinator Continuity and Emergence Capital.
Quartet Health Inc., which makes software to coordinate care
between primary physicians and mental health care providers, said
Christina Mainelli joined the company as chief operating officer.
She was previously executive vice president and chief growth
officer at Beacon Health Options. New York-based Quartet Health is
backed by Oak HC/FT, GV, F-Prime Capital, Polaris Partners,
Deerfield Management and Echo Health Ventures.
Exits
Publicly traded construction management software provider
Procore Technologies Inc. agreed to acquire Levelset, whose
software helps the construction industry simplify compliance and
payment processes, for about $425 million in cash and $75 million
in stock. New Orleans-based Levelset is backed by investors
including Horizons Ventures, S3 Ventures, Altos Ventures, Operating
Venture Capital and Brick & Mortar Ventures.
Syte, a product discovery platform for retail, is expanding its
presence in North America with its purchase of the fashion and
furniture segments of visual search company Slyce. Terms weren't
disclosed. With offices in Tel Aviv and Switzerland, Syte is backed
by investors including Viola Ventures, Commerce Ventures, Storm
Ventures and LG Technology Ventures.
Healthcare data insights provider Clearsense acquired Compellon,
a plug-and-play AI analytics company, for an undisclosed sum. In
March, Jacksonville, Fla.-based Clearsense said it raised a $30
million round led by Health Catalyst Capital. Kairos Ventures was a
backer of Lake Forest, Calif.-based Compellon.
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New Money
Kavak, a Mexico-based used-car marketplace, scored $700 million
in Series E funding, giving the company a valuation of $8.7
billion. General Catalyst led the round, which included
participation from Tiger Global Management, Founders Fund, Ribbit
Capital and others.
Dapper Labs Inc., developer of the digital collectibles platform
NBA Top Shot, picked up a $250 million investment led by Coatue
Management. New investors BOND and GIC also participated in the
round, alongside previous backers Andreessen Horowitz, GV and
Version One Ventures.
Opentrons Labworks Inc., a Brooklyn, N.Y.-based lab automation
startup, landed $200 million in Series C funding. SoftBank Vision
Fund 2 led the round, which included support from Khosla Ventures.
In addition to the funding, Opentrons named Greg Greeley to the
post of president and chief operating officer, and Myrtle Potter as
chair of the board. Mr. Greeley was previously president of Airbnb.
Ms. Potter is currently chief executive of Sumitovant.
FLYR Labs, a San Francisco-based provider of a revenue operating
system for airlines, travel and transportation, secured $150
million in Series C funding. WestCap Group led the round, which
included contributions from Silver Lake Waterman, WndrCo, Peter
Thiel, Streamlined Ventures, JetBlue Technology Ventures and Gopher
Asset Management.
Lilac Solutions, an Oakland, Calif.-based lithium extraction
technology provider, held the first close of a $150 million Series
B round. Lowercarbon Capital and funds and accounts advised by T.
Rowe Price Associates Inc. led the investment, which included
participation from Mercuria Energy Trading, Valor Equity Partners,
Breakthrough Energy Ventures and The Engine.
sunday, an Atlanta-based restaurant payment app, raised $100
million in Series A funding. Coatue Management led the round, which
saw participation from partners of DST Global and others.
StreamElements, a Tel Aviv-based provider of engagement and
monetization tools for live and video-on-demand content creators,
nabbed a $100 million investment. SoftBank Vision Fund 2 led the
funding, which included support from PayPal Ventures, State of Mind
Ventures, Pitango and others. In addition to the round,
StreamElements named Gil Hirsch as chief executive, Yuval Tal as
chief operating officer, Jason Krebs as chief business officer, Udi
Hoffmann as chief financial officer and Doron Nir as president.
Ocrolus Inc., a New York-based digital lending automation
platform, grabbed $80 million in Series C financing at a valuation
north of $500 million. Lead investor Fin Venture Capital was joined
by Thomvest Ventures, Mubadala Capital, Oak HC/FT, FinTech
Collective, QED Investors, Bullpen Capital, ValueStream Ventures,
Laconia, RiverPark Ventures, Invicta Growth, Stage 2 Capital and
Cross River Bank in the round. Logan Allin of Fin Venture Capital
joined the company's board.
Garuda Therapeutics, a Natick, Mass.-based developer of blood
stem cell therapies, launched with an oversubscribed $72 million
Series A round led by Aisling Capital, Northpond Ventures and
Orbimed.
Iron Ox Inc., a San Carlos, Calif.-based indoor farming startup,
completed a $53 million Series C round led by Breakthrough Energy
Ventures. Previous investors in the company include Crosslink
Capital, R7 Partners, Pathbreaker Ventures, Eniac Ventures, Amplify
Partners, At One Ventures and Y Combinator.
6K, a North Andover, Mass.-based producer of sustainable
advanced materials for energy storage and additive manufacturing
powders, closed a $51 million Series C round. Lead investor Volta
Energy Technologies was joined by Prithvi Ventures, LaunchCapital,
Anzu Partners and others in the new funding.
Bigeye, a San Francisco-based data observability platform,
secured a $45 million Series B round. Coatue Management led the
funding, which saw participation from Sequoia Capital and Costanoa
Ventures.
Tech News
Customers at the pop-up, called A Circular Store, can also bring
in clothes to mend and attend in-store workshops that will offer
tips on repairs. PHOTO: THREDUP INC.
Madewell, ThredUP test secondhand store in Brooklyn
Techs and the city: where Google, Amazon and others are
expanding their NYC footprint
Voters want to curb the influence of Big Tech companies, new
poll shows
Tech-focused Clearhaven Partners closes debut fund
(END) Dow Jones Newswires
September 24, 2021 11:24 ET (15:24 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.