The joy of private markets is persistence: the best investors can find and negotiate better terms with top entrepreneurs and can usually help sell them for more money. There can sometimes be an element of luck to get the first win in, which is why some firms doing a form of spray-and-pray at an early stage (think early years of GV, formerly Google Ventures, when it backed 100 companies inside three years,) or early in the economic cycle, for example 2009-2010, to boost the chances of this luck. But once the luck is in, capitalizing and building a firm takes skills of people management and burnishing of reputation to stay in entrepreneurs’ and buyers’ minds as having an edge.
If dealmaking is the sine qua non (indispensable action) of venture then one way to do this polishing is to play public relations well.
Rise of Lidar in 3D mapping for autonomous vehicles
By Kaloyan Andonov, GCV Analytics, and James Mawson, founder and editor-in-chief
Three developers of light, detection and ranging (Lidar) have raised funding over the past weeks in rounds backed by corporates, while others could have an edge having been developed with state backing. Global Corporate Venturing is preparing a Future of the Car report as part of its partnership with the Corporate Venturing in Brasil to be published on October 26 in Sao Paulo.
NEWS: PEOPLE
Renard heads west after SanDisk merger
Aymerik Renard has been made director of US-based data storage provider Western Digital’s corporate venturing unit, which has invested over $250m in more than 20 startups under chief strategy officer Mark Long. He said by email: “It’s exciting as we’ll be looking for investments that relate to any of our brands (WD, HGST, SanDisk, and G-Technology), and we can do earlier investments than we could before as well as larger investments, expands the universes of relevant prospects.”
University Corner:
William Wang has been appointed managing director of the Tsinghua Technology Transfer Fund.
FUNDS
Reliance pledges $750m for digital startup funding
The firm’s Jio Digital India Startup Fund is being launched in conjunction with its forthcoming 4G network, and the money is set to be invested in the next five years.
Although it’s not as strategically prominent as the likes of Alibaba and Tencent, China-based Legend Holdings has nevertheless been racking up some big spending when it comes to corporate venture capital, and its half-year report has revealed its CVC subsidiary, Legend Capital, launched two new funds earlier in the year. The funds, a $270m dollar-denominated fund and a $220m healthcare fund, are expected to close by the end of 2016 and bring the number of funds managed by Legend Capital to 11.
Elevator advertising firm Focus Media prefers partnerships when it comes to corporate venturing and has agreed to put together a $750m fund with state-owned investment holding group China Everbright. The New Industry Investment Fund will concentrate on growth-stage technology, media and telecommunications (TMT) companies, and the firms expect to raise an initial $300m for its activities. The alliance follows the formation of a TMT M&A fund by Everbright and IDG Capital Partners in June.
European insurance firms have been pretty active in the VC space, and ASR seems to be no exception, providing approximately $5.6m for Dutch impact investor Social Impact Ventures, which has closed its first fund at about $45m. The fund’s limited partners also included ASN Bank and European Investment Fund.
The fund’s LPs include Nationwide, Cardinal Health, Worthington Industries, Crane Group, AEP Ohio, Dispatch Printing Company, State Auto Insurance and IGS Energy.
Government Department:
UK Ministry of Defence arms Iris with $1bn
The Ministry of Defence has set up a new unit, dubbed Iris, to identify emerging trends in military technology and invest in companies through a $1bn fund.
EXITS
Caterpillar and Volvo Construction Equipment are set to record decent sized exits from IronPlanet, an online machinery and equipment trading platform that Ritchie Bros Auctioneers has agreed to buy for about $758m. No word on precise returns but Caterpillar owned almost 10% of IronPlanet when it filed to go public in 2010 (it withdrew the IPO application two years later). Michael Young, director, Caterpillar Ventures, by email said: “I would also say that Caterpillar’s involvement and our agreement to work with Ritchie Brothers ended up adding a lot of value to the transaction.”
Nestlé to swallow portfolio company Phagenesis
Phagenesis, developer of a medical device to treat dysphagia, had raised about $20m from investors including Nestlé’s Inventages Venture Capital unit.
Nokia exits Citymaps as it folds into TripAdvisor
TripAdvisor has paid an undisclosed amount to acquire social mapping platform Citymaps, which received funding from Nokia Growth Partners in early 2015.
IT business management technology provider Apptio has filed for a $75m IPO, after raising more than $135m in venture funding. Cisco invested in the company as part of its $20m series C round in 2010 but currently holds a stake sized at less than 5%.
University Corner:
Khan Academy catches Duck Duck Moose
Stanford-backed edtech Duck Duck Moose has been acquired by Khan Academy for the symbolic sum of $1.
INVESTMENTS
Immuno-oncology startup Arcus Biosciences has revealed it has raised $120m across two rounds. Celgene and Novartis were among the participants in a $49.5m series A that closed last year, before GV and Taiho came on board for a $70m round earlier this month. Arcus was founded in May 2015 by two co-founders of Flexus Biosciences, the immuno-oncology therapeutics developer acquired by Bristol-Myers Squibb in 2015. George Golumbeski, EVP at Celgene, who has also just joined the board of Tizona Therapeutics after its recent round, by email said: “We continue to invest ad-hoc in companies we want to get close to and support.”
Yi Technology records $90m series A
Xiaomi has led a series A round for Yi Technology, a manufacturer of drones and low-priced action cameras.
Compass, the Advanced Publications-backed operator of an upscale real estate listings platform, has secured $75m in a Wellington Management-led round that took its total funding to $210m. The round, closed at a $1bn+ valuation, will support an expansion into new markets beginning with San Francisco as Compass – founded as Urban Compass in 2012 – aims to increase the overall value of transactions on its platform, which currently stands at about $7bn per year. Denali, backed by Alaska state, also raised a large round from a mutual fund manager, Baillie Gifford.
There have been several reports recently that One97 Communications, operator of online payment platform Paytm, is raising money, and now founder and CEO Vijay Sharma has confirmed that MediaTek subsidiary Mountain Capital has invested $60m at a $4.8bn valuation. The investment is being made as part of a round expected to reach $300m with contributions from Alibaba, Ant Financial, Fosun and Foxconn among others.
Corporates McKesson and Medidata Solutions came on board to help bring life sciences cloud analytics platform Shyft Analytics’ overall funding to $31.5m. The health-tech area is interesting at the moment, as Blue Cross Blue Shield in August backed ID Experts. John Banta, managing director at Blue Cross Blue Shield Venture Partners, by email said: “We’re knee-deep in it. Particularly next-gen threat detection and IAM.”
Helix Sleep gets in bed with Simon Property
Simon Ventures Group (SVG) was one of the investors taking part in a $7.35m series A round for the bespoke mattress maker. Skyler Fernandes, head of SVG, by email said: “There is no commercial agreement between Simon and Helix, only an investment by Simon Venture Group. Helix does have an amazing in store retail experience where they construct mattress in front of you. Unlike any other mattress brand.
Engie has reinvested in solar energy platform BBoxx, expanding the off-grid solar energy provider’s total funding to $40m as it prepares to expand in Africa. We’ll be interviewing Engie next week as the corporate-impact venturing scene is very exciting! To provide more detail and feedback on your investments, exits and funds, please do get in touch.
Government Department:
NephroPlus cleans up $15m series C
International Finance Corporation has returned to back a series C round for NephroPlus, which operates kidney care clinics.
Blackwood Seven broadcasts $15m round
Danish Growth Fund, Vækstfonden, has returned a second time to back a $15m funding round that will help the media analytics platform expand into the US.