01 June 2020 – UBS Groups Prepares for Fintech Investments

The Big Ones

1

Switzerland-based bank UBS Group is setting aside hundreds of millions of dollars of its money to invest in financial technology companies, according to Bloomberg.

UBS hired Erasmus Elsner for its venture capital and growth equity unit last month but is reportedly still recruiting staff for a dedicated corporate venture capital (CVC) team. It is planning a corporate VC fund to make investments between $10m and $20m in dozens of companies targeting bank/client engagement, investing and financing platforms and the improvement of the bank’s underlying operations, a source told Bloomberg.

Mike Dargan, UBS’s Global Head Group Technology, said: “UBS wants to further engage with and support fintech firms. The new venture investment portfolio is a next step to accelerate our innovation and digitisation efforts.”

2

It’s a scary-enough headline, ‘Huawei Banned, So Let’s Invade Taiwan to Take TSMC?’, in reaction to the strict set of rules announced by the US government on May 15 in a bid to cut the China-based 5G and telecoms equipment maker off from the global semiconductor ecosystem.

In its subsequent report, “US strategic approach to the People’s Republic of China,” published on the 20th, the US said: “The administration is implementing the Foreign Investment Risk Review Modernization Act to update and strengthen the capacity of the Committee on Foreign Investment in the United States (CFIUS) to address growing national security concerns over foreign exploitation of investment structures, which previously fell outside CFIUS jurisdiction.

“This includes preventing Chinese companies from exploiting access to US innovation through minority investments in order to modernise the Chinese military. The US has updated its export control regulations, particularly in light of Beijing’s whole-of-society strategy and its efforts to acquire advanced technologies related to hypersonics, quantum computing, artificial intelligence, biotechnology and other emerging and foundational technologies. We are also engaging allies and partners to develop their own foreign investment screening mechanisms, and to update and implement export controls collaboratively through multilateral regimes and other forums….

“Domestically, the Administration is taking steps to strengthen the US economy and promote economic sectors of the future, such as 5G technology, through tax reforms and a robust deregulatory agenda. The President’s ‘Executive Order on Maintaining American Leadership in Artificial Intelligence’ is an example of a US government initiative to promote investment and collaboration to ensure the US continues to lead in innovation and setting standards for a growing industry.”

But the horse might have bolted. The ChinaTalk article at the top suggests Huawei has done enough over the past few years to survive, stating: “The main issue is supporting Huawei in maintaining its dominant position in 5G and helping it continue to be able to supply the needs of 5G bases.

3

The US healthcare system has many virtues, but it is simply too expensive and hard for consumers to access care, according to insiders. Coastal Americans’ faith in their system has been shaken by the coronavirus and this has created opportunities for some. Jeff Bennett, CEO of startup Higi, is trying to tackle the issue and has received a fillip with a new round of funding.

UK-based personal healthcare provider Babylon has joined the ranks of new corporate venturers by leading the latest round for US-based health engagement technology developer Higi.

The round was reportedly $30m in size and Higi’s previous investors, 7Wire Ventures, Flare Capital Partners, Jumpstart Capital, Rush University Medical Center for Health and William Wrigley Jr, also took part. Higi raised $25.8m in 2018, according to a regulatory filing, from investors including Blue Cross Blue Shield-affiliated venture firm Sandbox Industries, though Sandbox has said it is now no longer an investor.

4

Similarly, money is flowing in other parts of healthcare and life sciences. The power of science fiction films retains its hold in inspiring inventors but the secret to corporate venturing and open innovation lies in retaining optionality.

Drawing on inspiration from Star Trek, Vaxxas, a Queensland University, Australia, spin-out, has developed technology which could mean vaccine delivery via needles and syringes could soon be a thing of the past.

The World Economic Forum named the company a Technology Pioneer in late 2014 and over the past decade the company has been working on a nanopatch, based on research at the university’s Australian Institute for Bioengineering and Nanotechnology, that delivers vaccines painlessly and more efficiently than syringes.

5

Cisco intends to purchase the network analytics software producer, which had raised more than $110m from investors including GV and Salesforce Ventures, for a reported $1bn.

Networking equipment manufacturer Cisco agreed yesterday to acquire ThousandEyes, a US-based network management software provider backed by internet and technology conglomerate Alphabet and enterprise software producer Salesforce.

The price was reported by Bloomberg as being approximately $1bn, a figure confirmed to CNBC by a person familiar with the matter. Cisco expects the transaction to close by the end of next month.

Founded in 2010, ThousandEyes provides cloud analytics software that collects data from a range of access points, such as data centres and consumer devices, to identify potential sources of disruption and ensure websites, applications and services are delivered optimally.

Deals

Genome sequencing technology developer MGI Tech has closed a $1bn series B round, four years after being formed as a subsidiary of genome research organisation BGI. The round, which follows a $200m series A a year ago, shows the potential value in spinning off valuable subsidiaries, and it follows a $265m round for another China-based spinoff, smart sensor and power semiconductor provider BYD Semiconductor (see yesterday).

Chinese online grocer MissFresh has seen business pick up sharply during the coronavirus lockdown and has accordingly raised funding at a reported $3bn pre-money valuation. The company’s existing backers include Tencent and Lenovo but the only new investor revealed in media reports is CICC Fund. Bloomberg reported in the last few days that it was set to raise roughly $500m.

SpaceX meanwhile goes from strength to strength, the spacecraft producer and launch services provider expanding its latest funding round to $346m and surpassing its original target of a $250m close. Elon Musk has got a lot of flack over the past few years, but it’s worth noting that Tesla’s shares are continuing to rise while Alphabet-backed SpaceX is still growing – to a $36bn+ valuation, if reports from earlier this year are accurate.

Electric carmaker BYD is preparing for a Hong Kong Stock Exchange listing and as part of a restructuring effort it is spinning off semiconductor and sensor subsidiary BYD Semiconductor with $265m in external funding. Sequoia Capital China, CICC Capital and SDIC Venture Capital are co-leading the round, which will value the subsidiary at more than $1.3bn. Originally known as BYD Microelectronic, it was formed in 2004.

Marqeta makes off with $150m

Insitro has created a machine learning-equipped drug discovery platform and has secured $143m in a series B round featuring WuXi AppTec’s Corporate Venture Fund, GV and Alexandria Venture Investments. GV had already contributed to the $100m in series A funding with which Insitro emerged from stealth in mid-2018, at a $1.05bn valuation.

Arvelle arcs to series A close

Pie Insurance picks out $127m

Bolt flashes on fresh funding

AbCellera has built an antibody drug discovery system and has secured $105m in a series B round featuring Eli Lilly, having signed a collaboration agreement with the pharmaceutical firm last week. In fact it’s been a great few weeks for Canada-based AbCellera, which got a commitment for up to $125m in financing from government agency Innovation, Science and Economic Development Canada at the start of this month.

Elsewhere in China, Xiaomi has invested almost $103m in power bank producer Zimi through a cash-and-stock deal that increased its stake in the company from 22.5% to 49.9%. Zimi was already part of the Xiaomi ecosystem, a strategic investment initiative intended to construct a network of companies producing Xiaomi-compatible products. That network reportedly now encompasses some 300 portfolio companies.

Mindstrong mines Optum for $100m series C

Oxford Nanopore expands latest round

CFS sees out $84m series A2 round

Exits

Sendo and Tiki test the waters for merger

Roche reaches for portfolio company Stratos

UA’s FreeFall Aerospace completes merger

Kintor Pharmaceutical has however successfully floated in Hong Kong, pricing its initial public offering at the top of the range to raise $240m. The IPO featured a $115m cornerstone investment by appliance maker Gree, which provided $89m, Highlight Capital and Foresight Fund. It was 500-times oversubscribed according to Kintor, which is developing prostate and breast cancer drugs, and which plans to now expand into hair loss treatment.

VeriSilicon vies for $111m in IPO

Avidity to invade public markets

Burning Rock files for $100m IPO

Pliant places IPO terms

Nanoform to shape $76.7m IPO

Funds

U-M taps Deerfield for Great Lakes Discoveries


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

26 February 2018 – EasyHome Raises Over $2bn

Deals

Chinese furniture and home improvement retail chain EasyHome has raised just over $2bn in a round in which Alibaba invested approximately $860m in return for a 15% stake.

Uber could acquire what sources told CNBC would be a sizeable stake in Southeast Asian counterpart Grab through a deal that will involve Grab taking on its local business.

Procept BioRobotics, the developer of an aquablation treatment for a prostate condition called benign prostatic hyperplasia, has secured $118m in a round led by Viking Global Investors.

Harry’s has been one of the two biggest players in the razor blade subscription market, along with Dollar Shave Club, and the Grace Beauty-backed company has raised $112m in a round that will precede an expansion of the business model into areas like personal care items for both sexes as well as baby products and household goods.

Kallyope, a US-based company developing drugs that focus on the gut-brain axis, received $66m in a series B round featuring Illumina Ventures, the corporate venturing subsidiary of genomics technology producer Illumina.

AI data analytics platform SparkCognition has added $24m from investors including corporate venturing units Invenergy Future Fund and CME Ventures to close its series B round at $56.5m.

Glossier, a US-based skincare and beauty product company backed by talent agency William Morris Endeavor (WME), raised $52m in a series C round yesterday co-led by VC firms IVP and Index Ventures.

Financial services provider Power Financial has invested another $51m in robo-advisor operator WealthSimple, taking its total commitment to $165m according to the latter.

Smart glasses developer OrCam has received $30.4m in funding from investors including Clal Insurance at a reported valuation of about $1bn. OrCam, which counts Intel Capital as an earlier investor, is said to be prepping an IPO for 2019 and will aim to raise one more substantial round of funding before then, having so far secured a total of $130m according to Reuters.

On GUV, Liquidia Technologies, a US-based biopharmaceutical spinout from University of North Carolina at Chapel Hill, has raised $25.5m in funding.

Funds

SoftBank Vision Fund has already secured some $40bn from Middle Eastern sovereign wealth funds PIF and Mubadala Investment Company, and now the CEO of Bahraini sovereign wealth fund Mumtalakat has confirmed it too is in talks to invest.

Cove Fund, a family of seed-stage venture capital funds that invests in companies affiliated with University of California (UC) System, has raised more than $12m for its second fund. The figure represents a first close for Cove Fund II, with a regulatory filing indicating a $15m target size.

Switzerland-headquartered biotechnology and chemicals supplier Lonza Group has formed a corporate venturing fund in partnership with US-based venture capital firm Prolog Ventures.

Exits

Flatiron Health agreed to an acquisition by investor Roche in mid-February that will involve the latter paying $1.9bn for the company’s outstanding shares, and much of the attention has understandably been on Roche.

And talking of GV’s recent spate of life sciences exits, it looks like the next one will be Arcus Biosciences. Immuno-oncology therapy developer Arcus has filed for a $100m initial public offering, having previously raised some $227m in VC funding.

Social media company Momo agreed today to acquire China-based social engagement platform Tantan for about $760m, allowing media group Bertelsmann and social network operator YY to exit.

Faceu, the developer of an augmented reality app that allows effects to be overlaid on photos or videos in real time, has reportedly been acquired by mobile news platform Toutiao for $300m.

Enterprise cloud security technology provider Zscaler had raised $148m in funding from investors including the Dell-owned EMC and Alphabet unit CapitalG, and has now filed to raise up to $100m in an initial public offering.


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

19 February 2018 – Wells Fargo-backed Venture Firm NVP Closes $1.5bn Fund

Funds

NVP, the Wells Fargo-backed venture firm has closed its largest ever fund, having secured $1.5bn to invest from seed to late stage.

The mobile advertising platform Calldorado App Growth Fund will provide marketing funds for app developers using its software.

Exits

Pharmaceutical firm Roche agreed yesterday to acquire cancer research technology provider and portfolio company Flatiron Health, paying $1.9bn for the remainder of the company’s shares.

OpenText has paid an undisclosed sum for file sharing service provider Hightail, which had raised $83m from investors including Western Digital Capital.

Luxury fashion e-commerce platform Farfetch is seeking banks for an initial public offeringthat could take place before the end of this year at a valuation of up to $5bn. Strategic investors in line for an exit in the IPO include media group Condé Nast, a shareholder since 2013, and e-commerce firm JD.com, which invested $397m in the company eight months ago.

China-based Huami produces smart wearable devices such as watches and activity tracking bands for its strategic partner, consumer electronics maker Xiaomi, and has just raised $110m in a US initial public offering. Xiaomi, which invested in the company at series A stage, held a 19.3% stake pre-IPO, and the proceeds will be put toward R&D, sales and marketing.

Video sharing platform AcFun, which had raised at least $110m from backers including Youku Tudou and SoftBank, has shut down its operations.

University

MIT spinout Twine Health has agreed to an acquisition by Fitbit and will join the wearable device manufacturer’s Health Solutions group.

Deals

Lightmatter and Lightelligence both emerged out of MIT earlier this month and are exploiting research into photonic computer chips initially conducted jointly by the respective co-founders.

One company feeling the love is JD Logistics. China-based e-commerce firm JD.com had been running its own logistics for 10 years when it officially formed JD Logistics in April 2017, and the latter is now raising $2.5bn in funding that will help it grow on its own.

Celularity, the placenta-based regenerative therapy developer’s investors include Celgene, United Therapeutics, Sorrento Therapeutics, Human Longevity and Genting.

Kakao Games, a multi-platform game developer spun out of Kakao last year, has raised $130m in a round that included strategic backers Tencent, Netmarble Games, Actozsoft and Bluehole Studio. Tencent provided almost $47m of the funding according to Nikkei, and the proceeds will support international expansion as Kakao Games gears up for its own IPO.

Mastercard has participated in a $71m series C round for Yapstone, a provider of payment processing software for online and mobile marketplaces, which took its total financing to about $180m. Mastercard has been unafraid to invest in big rounds, but this is the largest in which it has featured since June last year, when it contributed to a $300m round for another payment processor, AvidXchange.

Rani Therapeutics has now raised $142m in total, its latest investors including GV, Ping An Ventures, GeneScience, AstraZeneca, Shire and Novartis.


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

10 July 2017 – Looking to the End of Summer

Editorial: What do people want when the summer is over?

Funds

AT&T has been relatively quiet while competitors like Verizon, Telstra and SoftBank have made great strides in corporate venturing, but that may be about to change with the formation of a strategic investment fund in which the telecom firm plans to invest up to $200m.

Autoliv moves $15m to Autotech Ventures

Vinci helps Axeleo draw up first close

Government

RCIF gains $1bn

EIF buys into $198m Cipio fund

Germany awards funding to 48 institutions

Enterprise Ireland launches $68m fund

University

Tel Aviv heads to India

UC Riverside launches $10m Highlander fund

Exits

Jawbone raised hundreds of millions from investors such as Deutsche Telekom as it moved from Bluetooth-enabled speakers to wearable fitness trackers, and at one point was raising cash at a $3bn+ valuation. All that appears to have ground to a halt however, as reports suggest the company has begun liquidation proceedings, weakened by a Fitbit lawsuit and done in by the flatlining wearables sector.

Roche eats up MySugr

Delivery Hero has raised more than $1.1bn in an IPO that enabled the Rocket Internet-owned Global Online Takeaway Group to sell about $148m of shares.

Gaming product maker Razer has filed for its own IPO, in Hong Kong, and is set to raise more than $600m according to TechCrunch.

Sienna to scratch IPO itch

Internet service provider MyRepublic may have failed in its bid to become Singapore’s fourth big telecom company, but it still plans to float by the end of 2018,

Online storage technology platform Dropbox has begun preparations for what will likely be the biggest tech IPO since Snap went public in March, and will shortly begin interviewing investment banks for the underwriting positions.

Canada-based bone disease therapy developer Clementia Pharmaceuticals has filed for a $115m IPO in the US that will provide an exit to strategic backer UCB Pharma, after the latter took part in a $60m series B round for the company in 2015.

Investments

China Money Network today launches the China Unicorn Ranking 2017, the most complete list of all private start-ups in China currently valued at $1 billion or more.

Just weeks after Mobike closed a $600m funding round, its main rival in the bike sharing sector, Ofo, has raised $700m in a series E round led by Alibaba.

Kakao drives $437m mobility spinout

Tencent invested $44m investment in Coocaa, the smart television subsidiary of Skyworth Digital Holdings, last month, and it’s now repeated the trick, paying $66m for a 16.7% stake in TCL’s smart TV unit, Shenzhen Thunderbird Network Technology.

Steel producer Shougang has co-led a $73m round for online steel trading and services platform Zhaogang through a private equity vehicle called West Fund.

Headspace, the developer of a meditation and mindfulness platform that mixes a subscription-based guided meditation service with themed text and video content, has raised $36m in a round led by growth equity firm Spectrum Equity.

Axonics Modulation Technologies, the developer of an implantable neuromodulation system, has added $20.5m to a series C round that now stands at $35m.

Theva conducts $8m in EnBW-backed round

University

MuMac eyes first round


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

15 February 2016 – Chinese new year, fintech investor BBVA, Innogy Venture Capital, triple French biotech fund, Unicef, Shanghai reimburses venture capital firms and more

Funds

Financial services provider BBVA has been a notable fintech investor since early 2013 when it formed a $100m fund that has since backed companies including DocuSign, Taulia and Prosper. The bank has now elected to upgrade its participation, committing another $150m and spinning out its investments into a new VC firm called Propel Venture Partners. Propel is already operational in San Francisco and is actively recruiting for a London office.

RWE’s Innogy Venture Capital may have been quiet of late but that doesn’t mean the utility has given up on corporate venturing. Chief executive Peter Terium reiterated its commitment to innovation on Friday and revealed plans for another investment unit which will be sized at $145m.

In addition to that fund, RWE is also set to invest $15m in a so far unnamed greentech-focused venture capital fund.

France triples its biotech fund.

Unicef’s $9m Innovation Fund opens for expressions of interest from entrepreneurs, inventors and companies with working prototypes of open source technology that can improve the lives of vulnerable children.

The government of Shanghai’s plans to compensate venture capital firms that fail to make back their initial investment in startups has drawn criticism.

Investments

Uber has targeted $2.1bn in new equity funding at a jawdropping $62.5bn valuation in spite of a fundraising climate generally agreed to be cooling. Today it came a step closer, raising $200m from investment firm LetterOne, which joins a range of backers including corporates Alphabet, Baidu, Times Group, Ping An and China Life Insurance.

One of the biggest areas for VC funding last year was India’s e-commerce sector, and One97 Communications was one of the biggest recipients, securing $680m from Alibaba and Ant Financial. One97 is now looking to raise another $400m by the end of June to fund the spinning out of its flagship brand, Paytm, into a separate mobile banking and payment company.

A possible partnership with e-commerce marketplace Flipkart could also be on the cards. Africa Internet Group (AIG), the collection of African businesses overseen by Rocket Internet that is also backed by telecom companies MTN and Millicom, has welcomed a new backer. AXA paid $83m for an 8% stake in AIG as part of a strategic partnership that will allow it to sell insurance products through AIG’s companies, and in particular e-commerce marketplace Jumia.

Cambridge University breaks its own seed funding record for the third year in a row, investing $5.5m last year.

Exits

Proteostasis raised $50m (see below) while AveXis secured $95m, floating in the middle of its $19 to $21 range. AveXis, which is backed by Roche’s corporate venturing fund, will use the proceeds to steer its lead candidate, a gene therapy treatment for spinal muscular atrophy, through phase 1 trials.

Good analysis recommendation: Bruce Booth at Life Sci VC 

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