Term SheetTerm Sheet — Tuesday, July 25Erin Griffith10:02 AM ET
Hi, Term Sheet readers. My name is Robert Hackett, and I’m a reporter here are Fortune. You might remember me from this Q&A that appeared in Term Sheet a couple months ago.
In Erin’s absence, I intend to regale you with tales from the crypt—and by that I mean cryptocurrency. In case you haven’t been tracking this strange $90 billion market, it has been going B-A-N-A-N-A-S lately. There have been incredible reversals of fortune, the generation and vaporization of tens of billions of dollars overnight, and sure as heck, endless comparisons to the dot-com boom (and bust) of the ‘90s. Some people believe the sector is built on nothing more than elaborate pyramid schemes and “fake Internet money,” to use a technical term. Others say it promises to revolutionize tech and finance as we know it.
At Fortune’s Brainstorm Tech conference last week, we convened a number of experts who shared their thoughts about the present crypto mania. You can read the recap here. Otherwise, I’ve provided a summary of the top points by attendees below.
– Mike Cagney, CEO of SoFi, said that he is primarily interested in Ethereum, a blockchain network that rivals Bitcoin’s. Whereas Bitcoin aims to transmit value swiftly over the Internet, Ethereum’s ambition is to create a decentralized network for computation—a world computer—that’s distributed across a swarm of volunteer machines. As you read in an earlier edition of Term Sheet from last week, Cagney said that his company is looking into the possibility of using Ethereum to improve the market for title insurance, a niche segment of real estate finance.
– Balaji Srinivasan, CEO of 21.co, a well-funded cryptocurrency company, said that he’s bullish on the potential for cryptocurrencies to reshape global finance. In the long-term, the trend of startups hosting token sales—minting their own virtual money and selling them to the public for funding—threatens to displace Silicon Valley and Wall Street, he said. “It used to be that you had to come to Silicon Valley, walk up Sand Hill Road, network with individuals,” Srinivasan said. “That’s now being completely changed and turned on its head by the whole ICO thing,” he added, referring to “initial coin offerings,” another name for token sales, which have been all the rage in the crypto community in recent months.
– Peter Smith, CEO of Blockchain, a UK-based cryptocurrency firm that recently received an investment by GV, the venture arm of Google parent Alphabet, shared his opinion that entrepreneurs and investors are abusing the lack of regulations around ICOs. To hear him tell it, markets are being manipulated and insiders are trading. Still, Smith sees great potential for ICOs in the long term as well. In fact, he projected that Bitcoin and Ethereum will have strong competition. "Another really dominant coin could come out this year or next year,” he said.
– Brad Garlinghouse, CEO of Ripple and a former executive at Yahoo, agreed with Smith’s view that there’s a bunch of shady stuff going on in the crypto world. The furor gives him pause. “Heavily regulated markets are typically heavily regulated for a reason,” Garlinghouse said. “Frauds are happening, people are going to jail.”
– Kathleen Breitman, CEO of Tezos, a company that’s building a blockchain to rival Bitcoin and Ethereum, said she is hopeful that her project will continue to take off and become just as dominant as Bitcoin and Ethereum, if not more so. Tezos has already had early success with an initial coin offering that garnered more than $200 million in funding.
– Elena Kvochko, chief information officer of the security division at Barclay’s, said that her bank had discussed cryptocurrencies with regulators, who were not as repulsed as one might imagine. In fact, they were OK with the general idea, so long as the bank obeyed “know your customer” laws.
– Nicko van Someren, chief technology officer of the Linux Foundation, said that he expects innovations like Bitcoin to put pressure on companies like Visa, Mastercard, banks, and others to lower transaction fees and speed up settlements. Even if consumers don’t use flock to cryptocurrencies, they could still end up seeing benefits.
What do you think about today’s cryptocurrency craze? I would love to hear your thoughts. Please share and we will consider running a sound off in the near future.
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• Convoy, a Seattle-based tech enabled trucking network, raised $62 million in funding, according to TechCrunch. YC led the round, and was joined by investors including Cascade Investments, Mosaic Ventures, Barry Diller, Reid Hoffman, Simon Rothman, Marc Benioff, Bezos Expeditions, and Howard Behar. Read more.
• SimilarWeb, an Israel-based digital market intelligence company, raised $47 million in funding. Investors include Viola Growth, Saban Ventures, and CE Ventures.
• iguazio, an Israel-based real-time edge analytics provider, raised $33 million in Series B funding. Pitango Venture Capital led the round, and was joined by investors including Verizon Ventures, Robert Bosch Venture Capital GmbH, CME Ventures, Magma Venture Partners, Jerusalem Venture Partners, and Dell Technologies Capital.
• Duolingo, a Pittsburgh-based language learning website, raised $25 million in Series E funding at a valuation of $700 million. Drive Capital led the round.
• PerimeterX, a San Francisco-based provider of behavior-based threat protection technology for cloud, web and mobile, raised $23 million in Series B funding. Canaan Partners led the round, and was joined by investors including Vertex Ventures and Data Collective. Read more at Fortune.
• Leesa Sleep, a Virginia Beach, Va.-based direct-to-consumer online luxury mattress retailer, raised $23 million in Series B funding. One Better Ventures led the round.
• Nyotron, a Santa Clara, California-based cybersecurity company, raised $21 million in funding. DGB Investments led the round, and was joined by investors including Mitvah Shamir, Gil Agmon, and Shmuel Harlap.
• Prospera, an Israel-based digital farming company, raised $15 million in Series B funding. Qualcomm Ventures led the round, and was joined by Cisco Investments, ICV, and Bessemer Venture Partners.
• Maven, a New York-based digital clinic for women, raised a $10.8 million in Series A funding. Spring Mountain Capital led the round, and was joined by investors including 14W, DGNL, and Colle Capital. Existing investors including 8VC, Great Oaks Venture Capital, The Box Group, and F3 participated. Read more at Fortune.
• Circulation, a Boston-based digital platform for non-emergency healthcare transportation, raised $10.5 million in Series A funding. Flare Capital Partners and The Providence Service Corp led the round, and were joined by investors including Boston Children’s Hospital, Echo Health Ventures, Intermountain Healthcare Innovation Fund, Humana, NextGen Venture Partners and a healthcare diagnostics company.
• Bricata, a Baltimore-based developer of network security and data protection solutions, raised $8 million in Series A funding. Edison Partners led the round.
• SnapTravel raised $8 million in Series A funding, according to TechCrunch. iNovia Capital led the round, and was joined by investors including Lightbank, Bee Partners, and Hedgewood. Read more.
• BentoBox, a New York-based website services provider for restaurants, raised $4.8 million in Series A funding. Bullpen Capital led the round, and was joined by investors including Launch Capital, RiverPark Ventures, Jason Finger, Paul Appelbaum, and Clark Valberg. Read more.
• Ironhack, a coding and web design bootcamp with campuses in Madrid, Barcelona, Paris and Miami, raised $3 million in funding. JME Venture Capital led the round.
• Grabr, a San Francisco-based peer-to-peer delivery platform, raised $2.7 million in funding, according to TechCrunch. SignalFire led the round, and was joined by investors including FF Angel, NFX, Global Founders Capital. Read more.
• ActionStreamer, a Cincinnati-based wearable technology platform, raised $1.88 million in seed funding. CincyTech led the round, and was joined by investors including Vine Street Ventures.
• Urbanbase, a Seoul-based startup that makes virtual reality tools for interior planning and design, raised $1.8 million in Series A funding, according to TechCrunch. Investors include CKD Venture Capital, Magellan Technology, and Capstone Partners. Read more.
• MassRoots, a Denver-based cannabis tech and compliance platform, raised $1.217 million in funding. Investors include Isaac Dietrich.
HEALTH AND LIFE SCIENCES DEALS
• VenatoRx Pharmaceuticals, a Malvern, Pa.-based biopharmaceutical company, raised $42 million in Series B funding. Versant Ventures led the round, and was joined by Abingworth and Foresite Capital.
• Allegro Ophthalmics, a San Juan Capistrano, Calif.-based biotech company, raised $10.7 million in funding. The investors were not named.
PRIVATE EQUITY DEALS
• Gurnet Point acquired Innocoll, an Ireland-based specialty pharmaceutical and medical device company, for about $209 million.
• Goldman Sachs invested $35 million in beqom, a Switzerland-based provider of compensation management software.
• RoadSafe Traffic Systems, which is backed by ORIX Capital Partners and Aperion Management, acquired Beth’s Barricades, a Pittsburgh-based provider of traffic control services and products. Financial terms weren’t disclosed.
• Aptos Inc, which is backed by Apax Partners, agreed to acquire TXT Retail, a Milan, Italy-based provider of merchandise lifecycle management solutions for the apparel, luxury, specialty and general retail sectors. Financial terms weren’t disclosed.
• The CapStreet Group recapitalized Marco Group International, a Davenport, Iowa-based manufacturer of surface preparation equipment. Financial terms weren’t disclosed.
• Royal Dutch Shell and SoftBank are among several global groups considering bidding for Equis Energy, Asia's largest independent renewable energy producer valued at up to $5 billion, according to Reuters. Read more.
• SoftBank is seeking a multi-billion dollar stake in Uber, a San Francisco-based ride-hailing company, according to The Wall Street Journal. Read more.
• Refresco agreed to buy the bottling operations of Cott Corp (TSX:BCB) for $1.25 billion, according to Reuters. Read more.
• Michael Kors has agreed to buy luxury shoemaker Jimmy Choo (LSE:CHOO) for $1.2 billion. Read more at Fortune.
• PayPal Holdings made an investment of an undisclosed amount in LendUp, a San Francisco-based online lending startup, according to Reuters. Read more.
• SiteLock acquired Patchman, a Netherlands-based web security startup. Financial terms weren’t disclosed.
• Time Inc. is looking to sell a majority stake in Essence, its monthly African-American women’s lifestyle publication focused on entertainment, fashion and beauty and culture, according to The Wall Street Journal. Read more.
• AMTD Strategic Capital Group’s IPO application has been rejected by the Hong Kong stock exchange, according to Reuters. The Hong Kong-based corporate insurance broker, which is backed by Morgan Stanley's (NYSE:MS) private equity arm, filed to go public in May. Read more.
• Great Hill Partners sold Momondo Group Ltd, a London-based flight and hotel comparison platform, to The Priceline Group for approximately $550 million in cash.
• Trilantic North America agreed to acquire a majority stake in OrthoLite, an Amherst, Mass.-based manufacturer of branded open-cell foam insoles and other footwear components. The seller was Blue Point Capital Partners. Financial terms weren’t disclosed.
• Facebook acquired Source3, a New York-based content rights management startup. Financial terms weren’t disclosed. Source3 raised approximately $4 million in venture funding from investors including 645 Ventures, Contour Venture Partners, Correlation Ventures, and Crosslink Capital.
FIRMS + FUNDS
• Carlyle Group LP, a Washington D.C.-based investment firm, is looking to raise $15 billion for its next U.S. buyout fund, according to Bloomberg. Read more.
• Aquiline Capital Partners, a New York-based private equity firm, raised approximately $190 million for its Aquiline Technology Growth Fund.
• Southfield Capital, a Greenwich, Conn.-based private equity firm, raised $185.1 million for its second fund, according to an SEC filing. The fund’s target is $200 million.
• Falcon Seaboard Resources, a Houston, Texas-based oil and gas exploration company, announced the formation of a $145 million Falcon Seaboard Permian Fund I, LP. [This item has been updated.]
• BlackFin Capital Partners, a Paris-based private equity and venture capital firm, raised €100 million ($117 million) for its BlackFin Tech Fund 1.
• The Carlyle Group promoted Patrick R. McCarter and Campbell Dyer from managing directors to co-heads of the global technology, media and telecommunications team.
• Harvest Partners SCF hired Chris Schaller as vice president and promoted Chris Peyser from senior associate to vice president.
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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.