Hi, everyone, it is Wednesday! Hope you enjoy it.
Top News in the A.M.
The SEC has approved a plan from online retailer Overstock.com to issue company stock via the Internet, signaling a significant shift in the way financial securities will be distributed and traded in the years to come. Wired has the story here.
Never Mind Those Markdowns; An LP Plans for Next Year
Earlier this year, FLAG Capital Management — an asset manager that has backed a long list of top venture firms, including Accel Partners, Andreessen Horowitz, Redpoint Ventures, Spark Capital and Union Square Ventures — was acquired by the British fund managerAberdeen Asset Management.
The terms of the deal weren’t disclosed. But the union created a giant that manages $15 billion in private equity assets – money that many venture firms will invariably be competing to attract when they hit the fundraising trail next year.
To get a sense for how Aberdeen views the market right now, and who’s liable to see a check from the firm in the coming months, we chatted yesterday with its head of global venture capital, Peter Denious. Our conversation has been edited for length.
It’s a little choppy out there. Meanwhile, your job is to fund venture capital firms. Are you nervous? Are you planning to pull back a bit in 2016?
As it relates to venture, there won’t be any changes in our strategy. A lot of time was invested in this point [when we were being acquired by Aberdeen], and we plan to stay true to our model, which is to invest about $100 million per year in early-stage venture funds.
So you aren’t troubled by private-company valuations trending down right now.
I think it’s somewhat overdue. We aren’t interested in watching markets get overheated. I wouldn’t be surprised if we see more volatility in 2016, but I think it imposes more discipline on the private market.
What about interest rates? Would an expected rate hike impact your work?
For all asset classes, there will be some ripple effects for sure, but it’s probably going to be most muted in the case of venture capital and it wouldn’t change how we approach the business. I suspect it will have more of a dampening effect on capital flowing into other alternatives, including the buyouts space.
You sound so positive about venture capital.
It’s been a banner year for distributions for the industry and certainly for FLAG, and now Aberdeen, where we’ve seen record-setting amounts of cash returned. That’s really a reflection of what happened very early this year and last year, when a lot of companies went public; VCs have to work off those lock-up periods, and that takes time. But we’ve had the good fortune of being able to send back a lot of money to our investors.
Of course, IPOs are now down 50 percent year-to-date by dollar amount.
Blue River Technology, a four-year-old, Sunnyvale, Ca.-based company that makes robotics systems for farms that employ computer vision and machine learning, has raised $17 million in Series B funding. Pontifax AgTech led the round; Syngenta Ventures, Monsanto Growth Ventures and earlier investors Data Collective Venture Capital, Khosla Ventures and Innovation Endeavors also participated.
Bringg, a 2.5-year-old, Tel Aviv-based tech company that targets enterprises looking to take control of their logistics and deliveries, has raised $5 million in Series A funding from earlier investor ITURAN, a fleet-management company, along with a new, unnamed U.S.-based strategic investor. TechCrunch has more here.
Clover Health, a 1.5-year-old, San Francisco-based company that’s trying to use data analysis and preventative care to improve healthcare for seniors, has raised $35 million in Series B funding led by Sequoia Capital, with participation from earlier backers Athyrium Capital Management, First Round Capitaland individuals. Fortune has more here.
Digital Guardian, a 12-year-old, Waltham, Ma.-based maker of advanced data protection software, has raised $66 million from a long list of investors, including GE Pension Trust, Fairhaven Capital Partners, Loring Wolcott & Coolidge, Special Situation Funds, Brookline Venture Partners, LLR Partners, Mass Mutual Ventures, and Siemens Venture Capital. TechCrunch has more here.
Faction, a nine-year-old, Denver, Co.-based company that sells cloud computing infrastructure services, has raised $6 million in new equity and debt financing. Earlier backers Meritage Funds and Sweetwater Capital provided the equity, while Ares Capital provided the debt. Denver Business Journal hasmore here.
Inthera Bioscience, a two-year-old, Zurich, Switzerland-based developer of small molecule therapies for solid tumors, has raised $3.7 million in new funding led by MS Ventures, with participation from Dutch Aglaia BioMedical Ventures, Danish Novo Seeds, and EVA Basel. Startupticker has more here.
NavVis, a two-year-old, Munich, Germany-based company that makes interior mapping and navigation software, has raised $8.2 million in Series B funding led by Target Partners, with participation from Google developer advocate Don Dodge and return backers MIG Fonds and Bayerische Beteiligungsgesellschaft. TechCrunch has more here.
Oration, a 3.5-year-old, Foster City, Ca.-based company whose software promises to help employers and employees save money on pharmacy costs, has raised $11.2 million in Series A funding from DFI Venture, Google Ventures, Andreessen Horowitz, Chicago Ventures, Data Collective, Work-Bench,Arsenal Ventures Partners and TIE Angels. San Francisco Business Times has more here.
Profusa, a six-year-old, South San Francisco-based company that has developed an internal biosensor that continuously monitors body chemistry, has raised $13.2 million in Series B funding led by the China-based firm 3E Bioventures. Earlier backers Asset Management Ventures and Qihoo 360 also joined the round. More here.
Textio, a year-old, Seattle-based startup that analyzes text for how well words and phrases perform in certain scenarios, has raised $8 million in funding led by Emergence Capital. Cowboy Ventures, Bloomberg Beta, and Upside Partnership also joined the round. TechCrunch has more here.
Trustlook, a 2.5-year-old, San Jose, Ca.-based mobile security company for the Android platform, has raised $17 million in Series A funding led by Trustbridge Partners, with participation from Sparkland Ventures, Linear Capital Partners and return backer Danhua Capital. More here.
360 Capital Partners, an eight-year-old, Paris, France-based venture firm, has raised a new, $38 million fund (€35 million) that it will use to invest in seed-stage companies. The idea: to write check of between $330,000 and $1.1 million. The firm’s limited partners include MAIF, Société Générale, Groupe Rocher, Thuasne and the Fonds National d’Amorçage.
Google is launching a new accelerator program today. The Launchpad Accelerator will provide mobile startups in India, Brazil and Indonesia with mentorship, training, support, and up to $50,000 in equity-free funding. More here.
Slack, the two-year-old, business-messaging startup, has launched an $80 million venture fund that will primarily invest in startups building apps on top of Slack. Investors in the fund include Accel Partners, Andreessen Horowitz, Index Ventures, Kleiner Perkins Caufield & Byers, Spark Capital, and The Social+Capital Partnership. Slack has also launched an app store called App Directory, where users can download third-party apps that integrate with Slack.More here.
Yesterday, the University of California announced a $250 million venture fund to invest in startups that emerge from the 10-school system. The fund will focus on students, professors and alumni and have a particular emphasis on startups in the life sciences, technology, energy, agriculture and materials sectors. Vivek Ranadive, an entrepreneur and owner of the Sacramento Kings, will head up the effort. More here.
Top10, a four-year-old, London-based startup that showed travelers the 10 best hotels in any given city, has shut down. The reason, say it founders: growth had slowed, and competition with established players was too fierce. Altogether, the company had raised $12.4 million (£8.2 million) in funding from investors, including Balderton Capital and Accel Partners. Business Insider has the story here.
Vroom, a 2.5-year-old, New York-based seller of used cars online, has agreed to acquire competitor Texas Direct Auto of Stafford, Texas under a cash-and-stock deal financed that’s being financed with $95 million in Series C venture funding. Vroom’s Series C investors include earlier backers Catterton Partners, T. Rowe Price, General Catalyst Partners, and Allen & Company, among others. The WSJ has the story here.
The ride-share service Lyft has hired Evan Cohen to head up its East Coast operations. Cohen left his position as COO at Foursquare in June of last year.More here.
George Hotz, who was the first person to hack an iPhone, is building a self-driving car — by himself.
Padmasree Warrior, who left Cisco’s executive ranks in September, is joining NextEV, a China-based electric car company, as its U.S. CEO and global development head. Fast Company has more here.
UK authorities have arrested a 21-year-old man in London in the VTech hack, which exposed the data of 6.4 million children last month.
Google is turning its self-driving cars unit into a standalone business under Alphabet next year, reports Bloomberg. Google’s autonomous cars will offer “rides for hire.”
Rent your place on Airbnb? The landlord wants a cut.
How the universal symbols for escalators, restrooms and transportation were designed.
The most ridiculous facial expressions of the GOP debate.
Pintrill pins. (H/T: Uncrate)