31 August 2020 – Ant Group Files for Dual Listing to Potentially Raise $30bn

The Big Ones

Cancer test developer Freenome has closed a $270m series C round that included Novartis and existing backers GV, Kaiser Permanente Ventures and Roche Venture Fund to hike its overall funding to $507m. The capital will be allocated to a clinical study for a blood test Freenome is developing for colorectal cancer screening, in addition to advancing additional oncology blood tests.

American Family Ventures was formed by insurer American Family in 2013 to invest in areas like insurance, financial services, big data and cybersecurity technology, and it’s following a recent trend by recruiting external limited partners for its latest fund. AFV Fund III has closed at $213m and its LPs will also be able to gain value through a scheme called AFV Platform that will be able to link them to portfolio companies and fellow investors.

Ant Group has officially filed for a dual listing in Hong Kong and Shanghai that could potentially raise $30bn – a figure that would equate to the largest initial public offering for a VC-backed company in history. It will reportedly now speak to underwriters and other stakeholders to determine the details of the flotations, which are expected to value it between $200bn and $300bn. Apart from Alibaba, corporates including China Post and China Life are also among its investors, both having backed it at a $60bn valuation in 2016.

Crossover: Kymeta, a US-based satellite broadband provider exploiting foundational research from Duke University, secured $85m in a funding round led by entrepreneur Bill Gates, with the backing of some of Kymeta’s leadership team. Kymeta has raised more than $282m in funding altogether, satellite operator Intelsat having contributed to a $73.5m round in 2017 together with undisclosed additional investors. Media group Liberty Global had joined Osage University Partners, Bill Gates, Lux Capital and Kresge Foundation in Kymeta’s $50m series C round in 2013. And Kymeta had already secured $12m in funding from Liberty Global, Lux Capital and Gates the year before.

Deals

Consumer companies have had a mixed at best time of it during the coronavirus pandemic but eyewear e-commerce platform Warby Parker has done quite well, raising $245m across series F and G rounds while hiking its valuation from $1.75bn in late 2018 to $3bn today. The company’s earlier investors include American Express Ventures and the latest round increased its overall funding to $535m.

Viva Republica, the creator of money management app Toss, has raised its own nine-figure round, pulling in $173m in a round that reportedly took its valuation from $2.2bn to $2.6bn. The company’s total funding now stands at $530m, its earlier investors including Novel Group, PayPal and Qualcomm Ventures. The funding will help it grow Toss into a more diversified finance-focused app that includes financial product recommendations.

Mural, developer of an online visual collaboration platform, has closed an $118m series B round that included Slack Fund and returning backer Gradient Ventures. The round came just seven months after Mural’s series A funding, but its initial investment came all the way back in 2012 in a tiny round featuring another corporate venturing unit, Intel Capital.

Data collaboration software provider Daitaku has raised $100m in series D funding from investors including Alphabet’s CapitalG unit. The round followed a secondary investment from CapitalG in December that valued Daitaku at $1.4bn, and the company said it has maintained a unicorn valuation in the latest round. It has also now secured $246m in primary funding altogether.

Funds

This is going to be a quick one today: other than the American Family Ventures fundraiser we’ve already covered, it’s been a slow week for funds.

Exits

Things are really beginning to heat up as we pass through the summer lull to the traditional autumn rush and a good deal of activity is focused on the public markets. Chinese smart electric carmaker Xpeng has floated in the US in an upsized $1.5bn initial public offering valuing it above $21bn. Alibaba and Xiaomi were among the Xpeng investors considering buying $400m of shares in the IPO, and its backers also include Foxconn, UCar and Douwan Entertainment.

The sheer scale of Ant’s forthcoming listing casts a large shadow, enough to almost make you forget what a big story it is that data analysis provider Palantir has also filed to go public. The Relx, Fujitsu and Sompo Holdings-backed company is eschewing an IPO in favour of a direct listing, following the likes of Spotify and Slack. It was valued above $20bn in 2016 but regardless of whether it’s maintained that valuation (and there are doubts about that), it will be one of the year’s biggest listings in a year set to be full of them.

Cloud data software provider Snowflake is another hugely valued tech company to file for an initial public offering, six months after closing a $479m series G round at a valuation exceeding $12bn. Salesforce Ventures was among the participants in that round but Capital One Growth Ventures got in earlier, backing its 2017 series D at a reported $500m valuation. It isn’t among Snowflake’s largest shareholders but it should be in for a bumper exit nonetheless.

Although a lot of companies are filing for IPOs, lidar technology developer Luminar has taken a different route, agreeing to a reverse merger with special purpose acquisition company (SPAC) Gores Metropoulos that will give it a Nasdaq listing and an expected valuation of $3.4bn. The deal is being boosted by $170m of financing from a syndicate including Van Tuyl Companies and Volvo Cars Tech Fund, the latter – like fellow corporates Corning and Cornes- an existing Luminar investor. Expect more of these kinds of deals, judging by the volume of SPACs entering the public markets of late.

In fact, another company to follow the SPAC route is 3D metal printer producer Desktop Metal, which will list on the New York Stock Exchange through a reverse merger with a SPAC called Trine Acquisition Corp. The combined business is set to be valued at $2.5bn, Desktop Metal having previously raised $438m from investors including Koch Industries, Alphabet, Panasonic, Techtronic Industries, Ford, Saudi Aramco, Lowe’s, BMW and Stratasys.

All these IPO and reverse merger deals have perhaps obscured the fact the M&A market seems to be doing quite well too. Fastly has agreed to buy web security application provider Signal Sciences for $200m in cash and $575m in stock, and the transaction will come after about $62m in funding. That money came from investors including O’Reilly Media’s OATV unit, which is in for a tasty exit having backed it in every round since its $2m seed funding.

Kymera Therapeutics raised almost $174m in its initial public offering on Friday, pricing its shares above their range before seeing them soar by 66% after their first day of trading. The small-molecule drug developer had previously received nearly $220m in funding from investors including corporate venturing units Amgen Ventures, Lilly Ventures, Pfizer Ventures, MRL Ventures Fund and Sanofi Ventures.

Israeli digital X-ray device developer Nano-X Imaging has also floated in the US, in a $165m IPO that scored exits for corporate investors SK Telecom, iA Financial, Foxconn and Fujifilm. The company priced its shares at the top of the range and their subsequent rise almost doubled its valuation from its last pre-IPO funding round, which closed in June this year.


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

16 March 2020 – Insightec Targets $150m Series F

The Big Ones

Insightec is targeting up to $150m in a series F round valuing it at $1.3bn post-money, and has already received a $100m commitment from Koch Disruptive Technologies to lead the round. The company is developing a system that will use ultrasound to conduct brain surgery without making an incision, and KDT also led its last round, a $150m series E in 2017.

Investment firm LSP has raised $600m for its LSP 6 fund, which it claims is the largest life sciences venture fund in Europe’s history. Limited partners for the fund, which significantly surpassed its $450m target, include pharmaceutical firms Bristol Myers Squibb and Otsuka Pharmaceutical. Netherlands-based LSP now has a total of $1.1bn at its disposal across three funds.

WeDoctor, the operator of a medical appointment booking platform, is reportedly interviewing investment banks for roles in a Hong Kong initial public offering potentially sized at up to $1bn. The company’s investors include Tencent, Fosun, Shandong Tyan Home, NWS Holdings and AIA, the latter two having co-led its last round in mid-2018, when it raised $500m at a $5.5bn valuation. The IPO is reportedly expected to value it at up to $10bn.

And in crossover news, Passage Bio, a US-based genetic medicines developer commercialising University of Pennsylvania research, has increased its initial public offering to more than $248m after underwriters exercised their over-allotment option in full. Underwriters purchased 1.8 million additional shares at the initial public offering price of $18, thereby injecting $32.4m into the company.

Deals

Kymera Therapeutics has closed a $102m series C round that will fund the progress of its immunotherapy pipeline, with cancer, autoinflammatory and autoimmune diseases in its eyeline. Although none of them were named as participants in the round, Kymera has a raft of earlier investors from the pharmaceutical industry including MRL Ventures, Sanofi Ventures, Lilly Ventures, Amgen Ventures and Vertex Pharmaceuticals.

Elsewhere in China but in a completely different sector entirely, agricultural product distributor Wangjiahuan has closed an $87m series B round led by local services portal Meituan Dianping. The round also featured GLP’s $1.6bn Hidden Hill fund, which had supplied $58.5m in series A funding for Wangjiahuan roughly 18 months ago.

The hospitality sector looks like it’s facing an uncertain time right now, but hospitality management software provider Cloudbeds has raised $82m in funding from participants including human resources firm Recruit. The round was led by Viking Global Investors and it followed a reported $20m in earlier funding, with existing investors PeakSpan Capital and Cultivation Capital returning for the latest round.

Bristol-Meyers Squibb has contributed to a series B round for Silverback Therapeutics that has closed at $78.5m. The biologic drug developer had previously raised $47.5m in a Celgene-backed series A round, and the latest cash will be used to progress its lead antibody into clinical trials in cancer.

ShopBack, the operator of an online consumer loyalty and rewards platform, has boosted a funding round that already included Rakuten Capital to $75m. Temasek led the full round, which the company said increased its overall funding to $113m. EV Growth, whose co-founders include Yahoo Japan and Sinar Mas, also took part, ShopBack’s earlier backers including InTouch, SoftBank Ventures Asia and Singtel Innov8.

Health benefits provider Lyra Health has also raised $75m, in a series C round that included Providence Health and Services ‘ corporate VC unit, Providence Ventures, that lifted its overall funding to at least $158m. The round was led by venture capital firm IVP and Castlight Health is among the company’s earlier investors.

Elsewhere in life sciences, Harbour BioMed has closed a $75m series B-plus round that included SK Holdings, Legend Capital and Zhejiang University Future Capital. Harbour is working on antibody-based therapies for cancer and inflammatory diseases but has now added a Covid-19 candidate to its pipeline. If it hits with that, expect its valuation to skyrocket. It traces its roots back to the Erasmus MC hospital.

Pager, the developer of a medical communication app, has secured $33m in equity and debt financing from investors including health insurance provider Horizon Blue Cross Blue Shield of New Jersey. The company’s earlier backers include Horizon Healthcare Services and Grupo Sura, and the latest funding will support geographical growth and product development.

Funds

Gas utility Enagás has also been busy fundraising and has put together a $170m fund in partnership with investment bank Alantra that will provide capital for renewable energy technology developers. The corporate is providing approximately $22.7m as a first commitment to Clima Energy Transition Fund and will also offer its expertise to portfolio companies.

Corporate venturing vehicle Strive rebranded from Gree Ventures last year and put down a target of more than $130m for its third fund – essentially double the amount it raised for the predecessor. In the end, Strive has closed the fund at just over $100m. It said the main priority was to reach $100m and that its central goal is to concentrate on its portfolio companies rather than fundraising.

Exits

Small molecule drug developer Zentalis is one of several life sciences companies to have filed for IPOs in recent days (see Ayala below), and it is targeting $100m in a Nasdaq offering. The decision comes after $162m in funding and will give Pharmaron the chance to exit. Let’s just hope the recent downturn in the public markets proves to be temporary rather than something longer lasting.

It maybe be hard going in the public markets right now but Imara has nevertheless gone public, raising $75.2m in an IPO that involved it floating at the bottom of its range, despite marginally increasing the number of shares in the offering. Imara is developing therapies to combat blood disorders and its shareholders include Lundbeckfond Invest and Pfizer Ventures, which hold a combined 15% of the company post-IPO.


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