15 June 2020 – Zuoyebang in Talks to Raise up to $800m in Coronavirus Boost

Big Ones

Online student answer and livestreamed education provider Zuoyebang was spun off by Baidu and has since received $585m in venture funding. Like many online education platforms however, it has seen a big uptick in business during China’s coronavirus lockdown, and is in talks to raise between $600m and $800m. The round would reportedly value Zuoyebangat $6.5bn pre-money, more than doubling the valuation at which it last raised money two years ago.

Novo has agreed to acquire Corvidia, developer of a phase 2b-stage treatment for chronic kidney disease, for an initial $725m that could potentially rise to $2.1bn if every milestone is reached post-purchase. That’s a hefty chunk of change, not least since Corvidia had disclosed just $86m in funding (not including a seed investment by VC firm Sofinnova Partners). Investors set to exit it include AstraZeneca and Fresenius Medical Care.

US-based social media company Facebook has begun setting up a corporate venture capital unit, Axios reported yesterday, citing a job listing posted by the firm. The prospective employee will be head of investments at Facebook’s New Product Experimentation (NPE) subsidiary, which it formed to launch consumer-focused apps. The post has since been deleted but it stated: “In this role, you will manage a multimillion-dollar fund that invests in leading private companies alongside top venture capital firms and angel investors. You will develop investment and impact theses, lead the execution of new investments and support existing portfolio companies as needed.” The fund will be partially managed by Shabih Rizvi, who spent two years as founding partner at internet technology provider Google’s artificial intelligence fund, Gradient Ventures, before moving to a business development role at Google in April 2019. A source familiar with the plans told Axios that Facebook is pursuing investments as a method of keeping track with emerging technologies, rather than operating what they termed as a general purpose fund. It will make small investments in early-stage companies.

In crossover news, it’s an exit this time. Fusion Pharmaceuticals, a Canada-based cancer radiopharmaceuticals developer spun out of McMaster University, has filed for a $100m initial public offering on the Nasdaq Global Market. The spinout’s lead asset is undergoing phase 1 studies in an injected form for advanced, refractory solid tumours. Fusion said in its prospectus it had been forced to pause further recruitment as the pandemic led to clinical trial sites to be closed. It has administered the drug to 12 patients to date, out of a planned 30. Fusion most recently secured nearly $112m in a series B round closed this month featuring Fight Against Cancer Innovation Trust, a commercialisation unit backed by Ontario Institute for Cancer Research and the province of Ontario, oncology technology provider Varian Medical Systems, Johnson & Johnson Innovation, and others. Varian and Johnson & Johnson Innovation – JJDC had already backed a $46m series A in 2017.

Deals

Many over the years have questioned the business model of grocery delivery app Instacart but the coronavirus stay-in-place restrictions have vindicated it somewhat and it has been hiring like crazy in recent months to meet demand. It has also now raised more money, taking in $225m through a round co-led by DST Global and General Catalyst that hiked its valuation from about $7.9bn to $13.7bn. Its earlier investors include Comcast, American Express and Whole Foods, the latter since consumed by Amazon.

Although it also delivers groceries, DoorDash’s focus is on on-demand food delivery from restaurants, and it is reportedly seeking hundreds of millions of dollars in a forthcoming round set to value it at more than $15bn pre-money. Like Instacart, which faced strike action over safety precautions a few months back, Verizon-backed DoorDash has also encountered scrutiny over business practices that allegedly include taking tip money intended for staff and fees some restaurants see as exorbitant. But it doesn’t seem to have had an effect yet.

The coronavirus lockdowns have given a big shot in the arm to companies operating in the online grocery industry, be it Instacart or Tongcheng Life, a China-based spinoff of travel services provider LY.com that operates a group buying service focused on fresh produce. The company has just raised $200m in a series C round led by social video platform Joyy that included Bertelsmann Asia Investments and Legend Capital, both of which took part in its $100m series B nine months ago.

Unacademy is among the online learning platforms to have seen activity shoot up as students have to stay home, and it is reportedly seeking up to $150m in funding to cover expansion. It raised $110m from investors including Facebook as recently as February but is said to be looking to double its $510m post-money valuation for the next round. The possible investors include Tencent, which has built a stable of edtech portfolio companies in its home country of China.

The uptick in e-commerce activity also has a knock-on effect for surrounding technologies. Anti-fraud software provider NS8 has completed a $123m series A round co-led by Axa Venture Partners and will allocate the funding to international expansion and product development. That’s a big haul for a series A and it comes after a year when NS8 quadrupled the size of its team from 50 to 200.

DNAnexus, the Stanford University spinout that has built a healthcare data software platform, has meanwhile raised $100m from investors including GV and Regeneron Pharmaceuticals. The round boosted the total raised by DNAnexus to more than $270m, its earlier investors including Microsoft and WuXi NextCode.

Cue Health specialises in molecular testing devices for both home and professional use, and has pulled in $100m through a series C round featuring Johnson & Johnson Innovation – JJDC. The company has now raised at least $169m altogether, and JJDC participated in the latest round having contributed to its 2018 round alongside another corporate VC unit, Dentsu Ventures.

Contract biopharmaceutical development and manufacturing services provider MabPlex has raised approximately $70.7m in series B funding from investors including Sunshine Insurance Group. The round, co-led by DT Capital Partners and Huajin Capital, comes in the wake of $59.1m in a series A round closed early last year.

Nano-X Imaging, developer of an advanced body scanner that is smaller and cheaper than established alternatives, has added $20m from SK Telecom to a series B round that now stands at $51m. The telecommunications firm had already put up $5m for the round before joining investors including Foxconn and Fujifilm in a $26m tranche in January.

Funds

Theodorus, the university venture arm of Université libre de Bruxelles (ULB), has increased the size of its fourth fund to €42m ($47.3m) following commitments from pension fund manager Caisse de dépôt et placement du Québec (CDPQ) and Belgian government-owned investment firm SFPI-FPIM. CDPQ supplied $3.9m through investment fund TFAQ2019, managed by Teralys Capital, while SFPI-FPIM injected $560,000, adding to a $5m it had already provided previously. Theordous IV will invest $18m in Canada-based and another $29.3m in Belgium-based spinouts over the next five years, aiming to bridge the two countries’ ecosystems. It will provide between $563,000 and $3.4m per spinout, targeting a 20-strong portfolio.

Exits

Cancer treatment developer Legend Biotech floated just over a week ago and has already closed the offering having raised about $487m. It was spun off by Genscript Biotech, which bought a further $23m of shares in the offering which have increased in value by more than 70% since the flotation. Legend’s other investors include Lilly Asia Ventures and Johnson & Johnson Innovation – JJDC.

Conventional wisdom said just a couple of months back that pursuing an initial public offering in the wake of the massive market drops in the spring would be futile, but several life sciences companies have proven otherwise, in many cases floating at the top or above their range, and now online car retail platform Vroom has followed suit. The AutoNation-backed company has gone public in a $468m IPO, having increased the number of shares and floating above an upscaled range. The offering may well reach $538m before it formally closes.

The Vroom offering, together with that of business data provider ZoomInfo, is set to open the floodgates in the IPO markets. Even Airbnb – which has been hit harder than almost anyone in recent months – is reportedly considering moving forward with its flotation, but Lemonade is significantly ahead. The digital insurance provider, valued at $2bn+ as of April, has filed for an offering with a $100m placeholder target that will almost certainly rise. It has received about $480m in funding from investors including SoftBank, Allianz, XL Innovate and GV since being founded.

One of the larger upcoming IPOs will be Snowflake, a cloud data software provider backed by Salesforce Ventures and Capital One Ventures that has reportedly filed confidentially to go public. Snowflake has pulled in some $1.3bn in funding and was valued at $12.4bn when it last raised money, in February. To put things in perspective, the FT reports that bankers have told the company it could float at valuation between $15bn and $20bn.


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

23 March 2020 – Fox Agrees to Buy Tubi for $440m in Cash

The Big Ones

When SoftBank emerged with a $9.5bn rescue package for beleaguered workspace provider WeWork in October, $3bn of the amount had been earmarked for a tender that would have involved it buying shares from existing investors and shareholders – likely including hotel chain Jin Jiang International and Legend Capital. However, the company has sent a letter to the shareholders stating that it believes regulatory probes into the WeWork business frees it from that obligation. It’s an interesting approach, but considering SoftBank’s influence at the company even before its IPO attempt, one that may be hard to follow through with.

Speaking of everyone’s favourite corporate. SoftBank’s efforts to raise capital for a second Vision Fund have been largely unsuccessful so far, but it is reportedly seeking $10bn, including $5bn from external backers, to shore up portfolio companies in the face of the Covid-19 pandemic, and maybe acquire rivals struggling with the same issues. Some of the portfolio companies set to be affected include Uber, WeWork, Didi Chuxing and Oyo, though others such as Slack, Paytm and DoorDash could find their business models strengthened by the virus and related social distancing.

Fox has agreed to buy online streaming service Tubi for $440m in cash, allowing MGM and Lionsgate to exit. Both contributed to Tubi’s $6m series A round, part of the $31m in funding it had disclosed prior to the acquisition. Fox should still have a big chunk of the Disney money it got from the 21st Century Fox purchase so it won’t be a surprise to see some more big acquisitions from it coming up soon.

In crossover news, Circle Pharma, a US-based oncology therapeutics spinout of UC San Francisco and UC Santa Cruz, has secured $45m in a series B round backed by UC Berkeley’s investment vehicle, Berkeley Catalyst Fund. Healthcare-focused venture capital fund Column Group led the round, which also included pharmaceutical firm ShangPharma, Nextech Invest and LifeForce Capital. Circle began operations when pharmaceutical firm Pfizer and Mission Bay Capital supplied an undisclosed amount of seed funding in 2014. ShangPharma added an undisclosed sum to the round in mid-2016.

Deals

Despite recent reports it was set to merge with key competitor Grab, ride hailing platform Gojek has raised $1.2bn in funding, reportedly bringing its series F round to nearly $3bn. The round already included Tencent, JD.com, Google, AIA, Mitsubishi, Visa, Siam Commercial Bank and Astra International, but no word yet on the identities of the new investors.

AI and imaging technology provider SenseTime has reportedly dropped plans for a Hong Kong IPO and is instead pursuing between $500m and $1bn in new funding. Its existing investors include Alibaba, Qualcomm, Suning and Dalian Wanda, and reports last year suggested its valuation could have reached $7.5bn. In any case, it’s possible a by-product of the coronavirus could be another push back in the IPO space leading to more late-stage rounds.

Plant-based meat product supplier Impossible Foods has raised $500m in series F funding and, in a sign of things to come, told Forbes it will use the money to offset expected difficulties caused by the ongoing coronavirus pandemic. The GV-backed company has reportedly now secured about $1.25bn in funding altogether, and the latest round was led by Mirae Asset Global Investments.

Digital currency technology developer Bakkt has secured $300m as it prepares to expand its crypto wallet to a more diversified crypto services app. The series B funding came from Microsoft unit M12, Naspers subsidiary PayU, Boston Consulting Group, CMT Digital and Intercontinental Exchange, the exchange operator that had spun off Bakkt in the first place.

Data streaming software provider Confluent is reportedly seeking $200m to $300m in a round that could double its valuation to $5bn. Its early investors include LinkedIn, which developed the open source Apache Kafka software on which the company relies. The funding would hypothetically be raised prior to an IPO taking place. Enterprise software has been one of the more resilient sectors of late, especially post-IPO, so that wouldn’t be a huge shock.

StackPath has secured $216m in a series B round co-led by corporates Juniper Networks and Cox Communications, following a $180m series A round revealed when it came out of stealth in 2016. Both leads took board seats at the edge computing technology developer, which plans to put the funding toward enhancing engineering and product development while commercialising its system.

Airwallex is meanwhile looking to raise $200m in a series D round set to be led by an as-yet unnamed financial services provider. The cross-border remittance service has so far secured just over $200m, with approximately half coming in a Tencent-led series C round a year ago that valued it at $1bn. The prospective round would be raised at a $1.5bn pre-money valuation.

Novo has participated in a $100m series G round for drug development software provider Tempus that valued it at $5bn post-money. The participants in the round had all previously contributed to the company’s last round, a $200m series F that closed in May 2019, the funding being raised at a $3.1bn valuation. It will use the series G proceeds to expand the range of conditions its technology serves.

Sigilon Therapeutics is developing bio-engineered cells to treat chronic illnesses without a patient’s immune system rejecting the treatment, and has completed an $80.3m series B round that lifted its overall funding to more than $195m. The round’s participants included Eli Lilly, already an equity investor as of a 2018 collaboration agreement that could potentially top $470m should all milestones be reached.

Engineered T cell therapy developer Eureka Therapeutics has bagged $45m in a series E round led by Lyell Immunopharma, which invested through a strategic partnership deal. Eureka has now raised approximately $134m altogether and will work with Lyell on solid tumour treatments, its own liver cancer candidate having entered phase 1/2 clinical trials.

Funds

Cryptocurrency exchange operator Binance has joined forces with its India-based subsidiary WazirX to launch a $50m fund that will invest in blockchain technology developers located in India. The Blockchain for India fund follows a decision by the country’s supreme court to allow financial services firms to take on blockchain companies as clients. As a result, cryptocurrency exchanges in the country are now also able to offer bank account transfers. Apart from providing funding, the vehicle will also look to incubate startups and support blockchain initiatives within universities.

Congruent Ventures, the venture capital firm anchored by University of California, is aiming to raise $125m for its second, sustainability-focused fund, according to a regulatory filing. The filing states Congruent Ventures II is still to raise capital. None of its potential limited partners have been identified. Founded in 2017, Congruent backs early-stage startups that advance sustainability objectives in areas such as urbanisation and mobility, clean energy, food and agriculture and industrial and supply chains. The first Congruent fund closed at $92m in 2018 with a $50m contribution from University of California’s Office of the Chief Investment Officer in addition to Prelude Ventures and undisclosed additional investors.

Exits

These are a different kind of exit, but Vietnam-based conglomerate Vingroup has shut down its corporate venturing unit, Vingroup Ventures. Founded in Ukraine in 1993, Vingroup moved into Vietnam in 2000 and has concentrated its activities in the country since then. Its main areas of interest include technology, manufacturing and a range of services in sectors including education, health and real estate. Vingroup established its CVC unit in late 2018 and had targeted $100m of investments across the globe according to its LinkedIn page, though it has failed to disclose a single deal in which it had participated.

DuPont Ventures, the corporate venturing subsidiary of chemicals producer DuPont, is set to close at the end of this month, according to a person familiar with the matter. Formed by DuPont in 2003, its investments have included deals for biofuel feedstock supplier NexSteppe, taste modification molecule developer Linguagen and ethernet services provider Actelis Networks. However, the unit has been relatively quiet of late, its last disclosed investment being its participation in a $75m round for Indiana University’s drone management software spinout PrecisionHawk in early 2018. DuPont Ventures’ closure comes as part of a restructuring that will involve the company’s larger corporate innovation activities being cut as part of a cost-saving process. The firm has not revealed whether it plans to divest the existing equity stakes held by its subsidiary.


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

07 August 2017 – Possible UK National Investment Fund

Funds

The government of the UK revealed it is considering the creation of a National Investment Fund to support startups that could become unicorns.

The Canadian government has announced it will make its visa scheme for entrepreneurs a permanent fixture.

Singapore-based venture capital firm Prestellar Ventures has raised $100m for a fund that counts Nepal-headquartered conglomerates CG Corp Global and NE Group as general partners.

Sompo Japan Nipponkoa Insurance, a subsidiary of Japan-based insurer Sompo, is committing at least $40m and possibly up to $80m, to venture capital firm TransLink Capital to manage its corporate venture capital fund.

India-based seed-grant impact fund Nudge Foundation, which targets poverty reduction, has collected capital from Tata Trusts, the philanthropic shareholder in conglomerate Tata and Sons, as well as motorcycle maker Maruti, networking technology producer Cisco, IT services firm Mphasis, conglomerate Godrej, retailer Target, bank Wells Fargo, Social Venture Partners and entrepreneur Nandan Nilekani.

N/Core is one of a few programs launched or announced last week – others included Morgan Stanley launching an accelerator that will focus on startups with female or multicultural founders, co-founders or chief technology officers.

Deals

Meituan-Dianping, the Chinese local listing and services portal formed in late 2015 by the merger of unicorns Meituan and Dianping, is reportedly in talks with investors to raise between $3bn and $5bn in a round that will feature a $1bn investment by existing backer Tencent.

SoftBank’s Vision Fund is reportedly in talks to invest $1.5bn to $2bn in Flipkart, which was valued at $11.6bn as of its last round earlier this year, in a deal that would enable it to join an investor base that already includes eBay, Tencent, Intel Capital and Bennett Coleman & Co.

Digital marketing company Avazu spun out app developer DotC in 2015, but now the boot’s on the other foot. DotC has raised $350m in a series B round led by Avazu’s parent company Zeus that involved the ownership of Avazu being transferred to DotC in a deal that will give Zeus a stake of just over 30.6% in the company.

Online fresh produce retailer Yiguo has secured $300m in funding from Alibaba subsidiary Tmall as part of a partnership agreement that will involve Tmall integrating Yiguo’s product into its existing offering.

Online business lending platform Kabbage has received $250m in funding from existing investor SoftBank, roughly doubling its overall funding in the process. Past investors in Kabbage, which will use the SoftBank cash to further develop its technology and expand its service offering, include UPS, Santander, ING and Recruit, while SoftBank initially invested in the company as part of a $50m series D round in 2014.

Peer-to-peer lending platform Dianrong has secured $220m in a round led by Singapore’s sovereign wealth fund, GIC, which was announced just after it agreed to acquire banking services provider Quark Finance’s asset generation operations in order to expand its physical presence in its home country of China.

E-commerce software and services provider ShopEx has secured $104m in a series D round led by venture firm Joy Capital.

Genetic therapeutics developer Homology Medicines has raised $83.5m in series B funding from investors including pharmaceutical firm Novartis, taking its overall equity financing to $127m across two rounds.

Impossible Foods has secured $75m in a round that will likely support the construction of a dedicated production facility for its plant-based burgers.

Novo has led cardiovascular therapy developer Milestone Pharmaceuticals’ $55m series C round, investing alongside Canadian state-owned BDC Capital, Fonds de solidarité FTQ, the development capital organisation for Quebec, as well as Forbion Capital Partners, Domain Associates, Pappas Capital, Go Capital and funds managed by Tekla Capital Management.

And on GlobalUniversityVenturing.com, we’ve had a few $20m deals. Among them: IonQ. GV, the corporate venturing unit of diversified conglomerate Alphabet, co-led a $20m series B round for quantum computing startup IonQ with New Enterprise Associates.

Another one was US-based car refuelling service provider Booster Fuels, which raised $20m in a series B round yesterday from investors including Stanford University’s StartX Fund. Booster allows drivers to park their car in work and request their tank be refilled through a mobile app.

And finally, US-based authentication technology developer UnifyID raised $20m in a series A round on Monday from investors including Stanford University’s StartX Fund. UnifyID has created an authentication platform that relies on sensors built into everyday devices and uses machine learning to identify users based on more than 100 unique characteristics such as the way they walk, sit and type. It requires no manual input from the user.

Exits

As mentioned earlier in the podcast, the long-running saga of Flipkart’s proposed acquisition of Snapdeal appears to have come to an unexpected end with news last Monday that Snapdeal has sensationally decided to call off the talks in favour of a restructuring process.

Twitter-backed music streaming platform Soundcloud is said to have entered talks with two private equity firms to raise funding in a deal that would give the as-yet undisclosed firms stakes that would jointly add up to a majority share.

Canada-based clinical-stage pharmaceutical company Clementia Pharmaceuticals has gone public in the US, floating at the top of its range and raising $120m.

Energy and oil producer China Titans Energy Technology Group has acquired Aquion Energy, a bankrupt US-based energy storage technology developer spun out from Carnegie Mellon University, for $9.16m, according to a regulatory filing.

GameSparks, an Ireland and UK-based platform for games developers backed by Irish state-owned export credit agency Enterprise Ireland, has been acquired by e-commerce company Amazon.

CarTrade, an India-based online automotive classifieds service backed by Temasek, is exploring a merger with its domestic competitor CarDekho, backed by diversified conglomerate Alphabet’s growth equity arm CapitalG, to create the country’s largest online car classifieds platform.

On GlobalUniversityVenturing.com, Intelesens, a UK-based wearable device maker to monitor patients’ vital signs that is based on Ulster University research, has been acquired by medical image management platform Ultralinq for an undisclosed amount.


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