29 June 2020 – Sana Biotechnology Raises $700m in First Round

The Big Ones

There is a true IPO bonanza going on at the moment and we’ll get to that in a moment, but there’s still a good deal of money sloshing around the sector for early-stage deals too. Sana Biotechnology is working on a string of drug candidates utilising stem cell technology and has raised a huge $700m for its first funding round. The participants include GV, whose diversification into life sciences has so far been very successful, the unit’s exits including Ipierian, Editas Medicine and Flatiron Health. Sana’s technology was developed by researchers at Harvard Medical School, University of Washington’s School of Medicine and UC San Francisco, in partnership with a team at incubator Flagship Pioneering.

Amazon formed its Alexa Fund five years ago but in recent times has made some hefty investments off its own balance sheet, not least in the transport sector where it has backed huge rounds for the likes of Rivian and Aurora Innovation. The corporate has now followed that by committing $2bn to a vehicle called the Climate Pledge Fund, which will invest in developers of products or services that can accelerate carbon reduction. Sectors in its eyeline include renewable energy, transport, logistics, manufacturing and materials, food and agriculture.

The IPO market – particularly in the life sciences sector – may explain why Invitae has splashed out to purchase precision oncology technology provider ArcherDX. Founded by Qiagen in 2015, ArcherDX had actually filed to go public earlier this month but Invitae has stepped in to agree a cash-and-shares acquisition valued at $1.4bn. That’s past tense, as the 30 million Inivtae shares included in the deal subsequently shot up by more than 40% in price on the public markets.

Deals

Sonder should in theory be one of the companies most affected by the coronavirus and indeed, the short-term apartment rental service reportedly fired or furloughed a third of its staff while selling off some 2,000 properties. But it claims it is back at 80% capacity right now and has secured $170m in series E funding from investors including property developer Lennar. The cash was raised at a $1.3bn valuation and Sonder aims to add another $30m before it’s closed.

Agricultural product and services provider Indigo has reportedly added $100m to a series F round featuring FedEx that now stands at $300m. FedEx backed the first tranche in January and Indigo, which is valued at $3.5bn, is said to be targeting $500m for a final close. The round’s other participants include Riverstone Holdings and existing backers Flagship Pioneering and Alaska Permanent Fund.

Pionyr Immunotherapies, a US-based immuno-oncology developer commercialising research from University of Toronto (UofT) and University of California, San Francisco (UCSF) has secured a $275m commitment from biopharmaceutical firm Gilead Sciences, which will acquire a 49.9% in Pionyr through the deal. The transaction forms part of a larger agreement worth up to $1.47bn that gives the corporate an exclusive option to purchase the remaining shares for another $315m and make potential milestone payments totalling up to $1.15bn.

Synchrony Financial and corporate venturing units MassMutual Ventures and Blue Venture Fund all contributed to a $100m round for Payfone, a provider of user authentication technology for phone-based customer services. The round nearly doubled Payfone’s overall funding, which makes sense considering its technology would feasibly be in greater demand in the wake of increased remote buying during coronavirus-related lockdowns.

Synqa, the Southeast Asian fintech provider formerly known as Omise, has bagged $80m in a series C round co-led by Siam Commercial Bank’s SCB 10X subsidiary. The round included insurer Aioi Nissay Dowa, Toyota Financial Services Corporation, Sumitomo Mitsui Banking Corporation and its SMBC Venture Capital unit. Synqa, whose earlier backers also include Sinar Mas, has built a mobile wallet and a crypto token trading network, and will use the series C cash to widen the range of products it offers.

Optum’s corporate venturing unit, Optum Ventures, has led or co-led four rounds in the past week, the latest being a $64m series C for Somatus. Kidney care provider Somatus has now secured $105m in total and will put the cash into geographical expansion and product development.

Ojo Labs, the developer of an AI chatbot for use in real estate deals, has completed a $62.5m round featuring Royal Bank of Canada and Northwestern Mutual Future Ventures. The company’s overall funding now stands at approximately $134m and it used part of the latest cash influx to buy online real estate portal Movoto in a deal that allowed another corporate, property developer Mitsui Fudosa, to exit.

Funds

Netherlands-based, healthcare-focused venture capital firm BioGeneration Ventures closed its fourth fund having raised €105m ($119m) from limited partners including pharmaceutical firm Bristol Myers Squibb (BMS). BMS and fellow existing backers Schroder Adveq and the European Investment Fund (EIF) joined newly minted LPs including Industriens Pension and KfW Capital in contributing to the oversubscribed BGV IV.

US-based talent agency Creative Artists Agency (CAA) formed an investment vehicle with venture capital firm New Enterprise Associates (NEA) that was launched with $100m in capital according to the Hollywood Reporter (not a publication we get to cite often on here!) Connect Ventures will leverage the existing relationships CAA has in the sports and entertainment industries, and the Hollywood Reporter stated that the companies plan to invest up to $400m through the venture.

Material Impact, a US-based venture capital firm with a keen interest in spinouts, has closed its second fund at $200m with limited partners including the endowments of Harvard and Princeton universities. Material Impact was founded in 2015 to invest in material science technologies and has backed more than half a dozen university spinouts to date through its first, $110m fund.

UK-based venture capital firm Epidarex Capital has closed a fund of more than £102m ($127m) to invest in life sciences companies, including spinouts, across the UK. The capital was supplied by the universities of Aberdeen, Edinburgh, Glasgow and Manchester, as well as government-owned British Business Bank, which made a $62m cornerstone investment through its Enterprise Capital Funds program, and pension scheme Strathclyde Pension Fund. A range of undisclosed, international backers have also invested in the fund.

Exits

One of the largest IPOs is set to be Agora, a Chinese provider of video engagement technology for app developers. The SIG-backed company will float later today in a $350m IPO that values it at $2bn, while three existing investors are pumping in a further $130m in the form of a private placement. The most interesting thing is that while Agora’s sales have jumped this year its Q1 revenue is still below $40m, which implies that while losses may not be a huge factor in a successful flotation, revenue may not be either.

Forma Therapeutics went public on the same day as Celgene Switzerland and BMS-backed precision cancer drug developer Repare Therapeutics in its $253m listing, and like Repare, Forma has closed an upsized IPO, having raised a total of $319m. The price of the Novartis and Eli Lilly-backed company’s shares have more than doubled since, indicating the current IPO gold rush is very far from over.

China-based Genetron Holdings, which is working on its own precision cancer treatments, has certainly shown the potential in that space. It has floated in the US in a $256m initial public offering that involved it adding on 3 million shares and then pricing them 19% above the IPO range. Vcanbio Cell & Gene Engineering has achieved an exit through the flotation, having invested in Genetron in 2016.

Relay Therapeutics – based on research from MIT, UC San Francisco and Brandeis University – has filed for its own IPO and has set an initial target of $200m. The precision cancer drug developer raised $400m in a 2018 series C round led by $300m from SoftBank Vision Fund and backed by GV and Alexandria Venture Investments. The trend of late has been for IPO candidates to price their offerings above the range, so this may turn out to be one of Vision Fund’s success stories. Right now it may be regretting not putting more money into life sciences deals.

Gene therapy developer Poseida Therapeutics has become the next biotech company to get in line to go public and has filed to raise up to $115m. Novartis provided half the capital in Poseida’s last round, a series C that closed at $150m nearly a year ago, and has a 14.9% stake. Its other backers include Transposagen Biopharmaceuticals, and the IPO proceeds will fund clinical development of prostate and bone marrow cancer treatments.

That isn’t – and I can’t believe I’m saying this – actually all the IPO stories from the past week so do head to GCV and GUV to read about the others, too.


“Funky Chunk” Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 3.0

22 June 2020 – DoorDash Raises $400m in Late Stage Round

Big Stories

Slowly, then suddenly change happens

This past week’s online roundtable for the Reinhard Mohn Prize 2020*, Fostering Innovation, Unlocking Potential, hosted by the Bertelsmann Stiftung (Foundation), saw luminaries from politics, business, civil society and science under Chatham House rule discuss which innovation policies and frameworks are now needed to facilitate economic prosperity and societal progress in the future and strengthen our crisis resilience.

Underpinning the discussion was new research published by the Bertelsmann Foundation in a report titled “World class patents in cutting-edge technologies: The innovation power of East Asia, North America and Europe”. Out of the 58 technology areas covered, with the top 10% classed as world class in each field, the US and China in particular are setting a much faster pace in key digital technologies, such as artificial intelligence, blockchain, quantum computing and big data, the report said.

Governments need to cure old habits of control

The traditional way to think of supporting entrepreneurs has been to look at their five primary needs: access to capital, finding customers, product and service development, hiring people and, eventually, an exit.

Increasingly, however, a sixth factor is coming into play: navigating big government.

From a reflexive position across much of the Anglo-Saxon world of privatisation and letting markets decide, since the days of Ronald Reagan and Margaret Thatcher, has come a counterblast from the East suggesting that industrial strategies, state bailouts and national champions are important.

This week, German government-owned development bank KfW agreed to invest €300m ($339m) in CureVac, the local developer of messenger RNA (mRNA)-based drugs whose technology could also influence development of a vaccine for Covid-19.

The transaction will give KfW a stake sized at about 23% and it comes after CureVacagreed a $90m loan from the European Investment Bank in March this year, when it announced it would concentrate efforts on developing a coronavirus vaccine, following press reports that the American government had tried to invest with a view to relocating the company and its products to the US.

Deals

DoorDash has raised $400m in a late-stage round that increased its valuation from $13bn last November to $16bn post-money. The online food delivery service has now secured a total of some $2.5bn in equity funding from investors including SoftBank and is still in line to go public having confidentially filed for an IPO in February. Durable Capital Partners led the round, which included Fidelity and T. Rowe Price.

Volkswagen invested $100m in solid-state battery developer QuantumScape two years ago and is increasing that commitment by up to $200m as the companies seek to strengthen their existing partnership. They are planning to set up a pilot facility to test out the industrial-scale manufacturing of QuantumScape batteries for use in Volkswagen’s electric vehicles, as the carmaker looks forward to upgrading from lithium-ion battery power.

Orca Bio organises $192m series D

C4 Therapeutics has closed a $150m series B round alongside $20m in venture debt, with the cash coming from new investors and largely undisclosed existing backers that could include Novartis, Roche and Kraft Group. The small molecule therapy developer launched in 2016 with $73m in a series A round that included all three corporates, and it plans to have four candidates in clinical trials by the end of 2022.

Corporates chip in as BYD Semiconductor gets $113m

GreenLight filters through $102m

Pagaya has built an AI software platform that utilises machine learning and data analysis to manage assets for institutional investors. It has also received $102m in a series D round featuring Clal Insurance and subsidiaries of Aflac, Bank Hapoalim and Siam Commercial Bank. The company, which has about $1.6bn under management, plans to now move into additional asset classes, particularly those related to fixed income.

University

4DMT materialises $75m series C round

Bit Bio whips up series A funding

Proprio picks up $23m

Exits

There have been a few significantly upsized IPOs of late, especially in the healthcare sector, but Avidity Biosciences has perhaps pulled off the biggest jump of all. Avidity, which is developing drugs for muscle diseases, raised $259m when it went public on Friday, floating above its range after increasing the number of shares by a whopping 44%. The company, whose investors include Eli Lilly, Brace Pharma Capital, ST Pharm and Takeda Ventures, then saw its shares rise 58% on their first day of trading. Despite ongoing uncertainty in the markets, it seems like tech companies are still in a prime position to IPO.

Kangua canters to $149m IPO

One of the larger tech companies still to make that leap is data miner Palantir, which has raised $1.9bn in funding from investors including Relx and which is reportedly readying a confidential IPO filing with a view to floating in September. Big data analysis provider Palantir has followed a $50m investment by Fujitsu with $500m from its partner in a Japanese joint venture.

Forma Therapeutics looks to be the next life sciences company to step up to the public markets, having set the range for an IPO that would net $212m if it floats at the top of that range. And some of its investors have been waiting longer than most for an exit. Novartis first invested in the cancer and haematologic disease therapy developer in 2009, with Eli Lilly following soon after. Both received a dividend early last year, and if Forma replicates the recent success of other drug developers they could be in for a bumper return.

Repare reaches public markets with $220m

Blued bids for $50m in US IPO

Proteus Digital produces bankruptcy filing


“Funky Chunk” Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 3.0

23 December 2019 – SoftBank invests $231m in Lenskart at $1.5bn Valuation

The Big Ones

India-based eyewear e-commerce platform Lenskart has been growing steadily in recent years, expanding its retail footprint to more than 530 stores and further commercialising its own brand. That work has been reflected in a $231m investment by SoftBank Vision Fund, made at a $1.5bn valuation – more than three times its reported valuation in May.

Insurance group Ping An has raised $786m for the second consumer-focused fund to be operated by its Ping An Capital subsidiary. Ping An Capital makes large-scale investments in both private and publicly-traded companies and has built a portfolio that includes Grab and Fullerton Financial.

Delivery Hero is pressing on with its international expansion, having agreed to pay $4bn to acquire Korea-based food delivery app developer Woowa Brothers. The price represents a premium from the $2.6bn valuation at which the company last raised money a year ago, and CyberAgent and Naver are both set to exit through the transaction, the former having backed Woowa Brothers at seed stage five years ago.

Italian energy utility A2A has formed a strategic investment fund called A2A Horizon that has been launched with some $78m in capital. What’s noteworthy here however is that the fund has been backed by Poli360 – the university venture fund of Polytechnic University of Milan – (yes, you heard right: a university venture fund helped a corporate put together a CVC unit). LPs also include 360 Capital Partners, the VC firm that already manages Poli360.

Deals

Glovo has become Spain’s second unicorn, after Cabify, the on-demand delivery services platform having pulled in $167m through a series E round that included existing backer Drake Enterprises. The company’s other investors include Rakuten, Delivery Hero and AmRest but the latest round was led by Abu Dhabi state-owned investment vehicle Mubadala.

Original design manufacturer Huaqin Communication Technology has received $143m in series B funding from investors including Intel Capital, Qualcomm Ventures and Zhangjiang Hi-Tech at a valuation that topped $2bn.

Forma Therapeutics has completed a $100m series D round led by RA Capital Management that will fund the advancement of drug candidates for sickle cell disease and cancer.

Chinese mother and babycare product retailer Hipac has closed its own $100m series D round and will use the cash for recruitment, enhancing its supply chain and making strategic M&A deals.

Short-term managed apartment provider Domio has secured $100m, half of which consisted of a series B equity round featuring SoftBank Capital NY. The other $50m was provided in the form of debt financing and the capital will support expansion efforts as the company looks to double the 12 US cities in which it currently operates to 25 worldwide.

Fusion power technology developer General Fusion has completed a $65m series E round led by Temasek that, together with a further $38m in government funding from Canada’s Strategic Innovation Fund, will support construction of a pilot plant.

Healthcare analytics platform developer OM1 has received $50m in funding in a round led by venture firm Scale Venture Partners that was also backed by existing investors that may have included corporate venturing unit Wanxiang Healthcare Investments.

Funds

Chemicals producer Sinochem is putting together a $143m fund that will invest in the new materials, energy and electronics chemicals spaces. The corporate will provide about 20% of its capital, with the rest set to come from a group of limited partners that will include another China-based chemicals company.

Exits

In the second huge corporate venturing-related M&A deal in the past week, following Delivery Hero’s $4bn purchase of Woowa Brothers, Intel has paid $2bn to acquire AI training processor developer Habana Labs. Intel Capital had led Habana’s $75m series B round in November last year, two months after it emerged from stealth, taking the company’s overall funding to $120m.

Beike Zhaofang, the online-focused spinoff of real estate brokerage Lianjia, has hired an adviser to help it prepare an initial public offering that could raise upwards of $1bn and take place as early as next year.

OneConnect has generated its own exit, in a $312m initial public offering in the US. Formed as Chinese insurer Ping An’s financial technology platform and spun off in 2017, OneConnect subsequently raised $750m from investors including SoftBank Vision Fund and SBI early last year.


“Funky Chunk” Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 3.0