Over September, GCV Analytics tracked 164 deals backed by corporate venturing investors, worth an estimated total of $6.09bn. The majority of those deals (74) took place in the US, although some of the top rounds were almost evenly distributed between China, the US and other geographies, such as Singapore and Canada.
The number of deals involving corporate VCs in September exceeded the number of such deals over the preceding two months of the quarter – 164 versus 115 in August and 137 in July. So far September seems to have been the month with the highest number of deals since the beginning of the year. However, there was a significant drop in the total capital raised in rounds, from $7.5bn in August to $6.09bn last month.
There was an almost equal number of deals with corporate participants as in the same month a year ago – 164 compared with 163. However, there was a significant difference in total capital raised – $9.77bn in September last year versus $6.09bn this year. This gap may be attributed to the unusually large $3bn round that Didi Chaxing raised last year from e-commerce group Alibaba, insurance firm Ping An and internet services company Tencent.
The leading corporate investors by number of deals were Qualcomm, Comcast and Salesforce, while the top three in terms of involvement in large deals were Lenovo, Alphabet and CDH Investments.
Deals
Emerging enterprises from the IT, consumer, health and financial services sectors attracted most corporate investors in September. However, the majority of top deals were raised by enterprises related to the transport sector or the broader autotech field.
The deals heatmap shows that corporate venturers from the IT, financial services and media sectors were the most active investors.
Le Supercar, a smart car developer spun out of China-based internet and technology developer LeEco, raised $1.08bn in funding from an array of backers, including laptop and smartphone maker Lenovo and conglomerate Macrolink Group, according to China Money Network. Launched in 2014, Le Supercar has a team of more than 1,000 people working on an autonomous car provisionally named LeSee. The startup is collaborating with sports car producer Aston Martin, automotive manufacturer GAC Group and electric vehicle developer Faraday Future, and plans to set up a $3bn auto park in Zhejiang Province where it will assemble the vehicles.
US-based accommodation marketplace Airbnb reportedly raised $850m in a round led by internet and technology group Alphabet’s growth equity unit, Google Capital. This represented its first direct corporate backing. Google Capital co-led the round with growth equity firm Technology Crossover Ventures, according to the Wall Street Journal, and the round valued Airbnb at $30bn, up from the $25.5bn valuation at which it raised funding last year.
China-based logistics service provider Best Logistics raised $760m in a round backed by conglomerate Fosun and logistics firm Cainiao Network. Other investors included Citic Private Equity, a subsidiary of Chinese government-owned Citic Group, Goldman Sachs, asset management firm CDH Investments and state-owned China Development Bank. Founded in 2007, Best Logistics operates a range of services including delivery and warehousing through various subsidiaries and franchises.
Telecoms and internet group SoftBank led an oversubscribed $750m series F round for Singapore-based ride-hailing platform Grab that included undisclosed existing investors. China-based ride-hailing platform Didi Chuxing was probably among them. The round valued Grab at $3bn post-money. Founded as GrabTaxi, the company operates a ride-ordering platform covering private cars, taxis, motorcycles and carpooling services in 31 cities in six Southeast Asian countries.
Guazi, a China-based consumer-to-consumer used car marketplace, secured an undisclosed amount of capital from Matrix Partners China and Blue Run Ventures. E-commerce platform 58.com holds 34% in the company following the deal. Guazi closed a $250m series A round earlier in September, reportedly backed by Sequoia Capital, GX Capital, Hike Capital, Welight Capital and StarAngelFund.
Metromile, a US-based pay-per-mile automotive insurance service, revealed it had raised $191.5m in the past two years, from investors including diversified conglomerate Mitsui and insurer China Pacific Insurance Group. Founded in 2011, Metromile offers car insurance priced according to the distance a customer drives, as well as a smart driving app and in-car telematics system that gives drivers detailed information on their travel.
Canada-based gesture control technology developer Thalmic Labs secured $120m in a round co-led by Intel Capital, the corporate venturing arm of chipmaker Intel, and e-commerce group Amazon’s Alexa Fund. The corporates co-led the round with Fidelity Investments Canada, a subsidiary of financial services conglomerate Fidelity, and other participants including venture capital firms Spark Capital, First Round Capital and iNovia Capital. Founded in 2012, Thalmic is working on gesture control technology that could eventually be used in entertainment, virtual reality, prosthetics and sign language.
Exits
Advanced Micro Devices, Samsung and GlobalFoundries were set to exit US-based semiconductor technology developer Soft Machines in a $250m acquisition by chipmaker Intel. Soft Machines licenses and co-develops architecture-based processor and system-on-chip products for the internet of things, mobile, networking and cloud computing industries. It claims its Visc (variable instruction set computing) technology can provide “unprecedented” performance efficiency.
Nutanix, a US-based enterprise cloud company backed by venture capital firm Sapphire Ventures, floated on Nasdaq after completing a $237.9m initial public offering valuing it at $2bn. The company sold 14.87 million shares at $16, slightly above the anticipated 14 million shares and their expected range of $13 to $15. Nutanix develops a cloud platform aimed at business users that combines server, virtualisation and storage silos into a unified interface.
Citrus Pay, an India-based mobile payment technology producer backed by e-commerce firms eContext Asia and Beenos Asia, is to be acquired for $130m in cash by payments services provider PayU Corporate, a subsidiary of media group Naspers. The news followed reports the previous month that Naspers was seeking to purchase Citrus Pay directly for $150m to $180m.
Ant Financial Services, an affiliate of e-commerce group Alibaba, acquired US-based identity authentication technology developer EyeVerify for $100m, providing exits to Qihoo 360, Sprint and Samsung, among other investors. EyeVerify produces biometric software that allows users to unlock their smartphones, make secure mobile payments and log into apps and services using only a selfie.
