Friday! Hope it goes as well as possible. See you soon, everyone.:)
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Top News in the A.M.
As reported by the WSJ, Snap is working on an IPO that could value the fast-growing virtual-messaging company at $25 billion or more, making it one of the highest-profile share debuts in years and — VCs are praying — possibly signaling a turnaround in the new-issue market.
In the wake of Yahoo‘s admission that the user names and passwords of 500 million accounts were swiped in 2014, Verizon wants a discount off its pending $4.8 billion agreement to buy the company. Like, a $1 billion discount. The New York Post has the story here.
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In Buyers’ Market, Acquirers Look to Lock in Key Players Longer
Acquisitions are often celebrated in the press. But academic research suggests that 70 percent to 90 percent of mergers don’t succeed, owing to a wide variety of factors. Buyers overvalue the synergies they’ll derive, or they underestimate the impact of the associated costs, or they rely too heavily on assumptions about where a market is heading.
Of course, another reason acquisitions don’t always go as planned is that founders often leave a year or two after their company has been gobbled up.
That’s changing in today’s challenging market for exits, where a growing number of well-funded companies and their investors are hoping that if an IPO isn’t in the cards, an acquisition might be. Indeed, in addition to other changing deal terms, acquiring companies are seemingly thinking long and hard about locking up talent longer than they have in the recent past.
You saw it happen when the e-commerce company Jet sold to Walmart for a whopping $3.3 billion in August. According to Recode, cofounder and CEO Jet Lore agreed to stay on with Walmart for an atypically long five years as part of the acquisition agreement. In fact, according to that same August report, if Lore leaves before the summer of 2021, he’ll forfeit a sizable amount of both cash and stock that could otherwise earn him up to an estimated $1 billion.
Lore may be exceptional in many ways, including his understanding of e-commerce and how to compete specifically with Amazon, which acquired his previous company. It’s easy to understand why Walmart wants him around. He probably won’t be alone, though.
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New Fundings
Financeit, a nine-year-old, Toronto-based company whose platform allows businesses to offer consumer financing to their customers from various devices, has raised $17 million in new funding co-led by The Pritzker Organization and DNS Capital. More here.
Lulalend, a two-year-old, Cape Town, South Africa-based online business lending platform, has raised an undisclosed amount of funding led by Accion Venture Lab, with participation from Newid Capital and Hallmann Holding International Investment. More here.
Nauto, a 1.5-year-old, Palo Alto, Ca.-based startup that uses cameras, motion sensors, GPS systems, and its own artificial intelligence software to detect what’s happening on the road and inside a car, has raised an undisclosed amount of venture funding and entered into data-sharing partnerships with big name auto and insurance companies BMW, Toyota and Allianz Group. The company had previously raised $12 million in Series A funding. TechCrunch has more here.
Nugit, a three-year-old, Singapore-based startup focused on marketing, has raised $5.2 million in fresh funding from Sequoia Capital’s India fund. The company had previously raised an undisclosed amount of seed funding from 500 Startups and The Hub Singapore. TechCrunch has more here.
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IPOs
Bloom Energy, a maker of fuel cell power generators that has raised $1.2 billion from investors over its 15-year history and was valued by investors at $2.9 billion back in 2011, has filed confidential IPO papers, reports the WSJ. More here.
CRISPR Therapeutics, a Basel, Switzerland-based gene editing company, plans to offer 4.7 million shares at between $15 and $17 per share, it says in its newest IPO-related SEC filing. Priced in the middle of that range, the company would have an initial market capitalization of roughly $636 million. To see who owns what, click here.
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Exits
Paribus — a New York startup that helps online shoppers get automatic refunds when prices drop on items they purchased and that first launched as part of the Startup Battlefield at TechCrunch Disrupt NY 2015 — has been acquired by Capital One. Deal terms were not disclosed. Paribus had raised at least $2.2 million in seed funding, shows CrunchBase. Its backers include Y Combinator, Greylock Partners, General Catalyst Partners, and Slow Ventures, among others. TechCrunch has more here.
Rinse, a three-year-old, L.A.-based on-demand laundry service, has acquired the assets of rival Washio — which shut down in August — for undisclosed terms. Rinse has raised roughly $10 million from investors, shows CrunchBase. Its backers include Javelin Ventures Partners, Arena Ventures and CAA Ventures. TechCrunch has more here.
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People
A systems engineer in New York who is suing Google, alleging the company systematically discriminates against older job applicants, won a key ruling this week; she can can now notify everyone else in her position that they may opt in to join a class action lawsuit against the search giant. Fortune has more here.
Oculus co-founder Palmer Luckey was conspicuously missing from the keynote stage at yesterday’s Oculus Connect 3 conference in San Jose, Ca. TechCrunch has more here.
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Jobs
Goldman Sachs Asset Management is looking to hire an analyst to help with due diligence, among other things. The job is in New York.
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Data
Take note, video publishers: A new study released this week from the Pew Research Center found that younger people are actually more interested in reading the news than watching it. Meanwhile, it’s OGs who prefer watching the news instead of reading, Pew found. More here.
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Essential Reads
Inside Rocket Internet‘s ailing startup factory.
Both Uber and Lyft have been hit with a court injunction banning their activity in Philadelphia, following complaints by the local taxi industry.
Postmates, the on-demand delivery company, has reportedly had trouble securing the additional funds it has chased for the better part of this year despite seeking new funding at around $450 million, the same as its Series D valuation. Quartz has more here.
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Detours
North American monsoons.
The cities where rent is rising the fastest.
“Everyone’s been wondering who would be the target of 2016’s worst racism. I didn’t even know Asians were in the running.”
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Retail Therapy
Nike Mags. Try and snag a pair; it’s for a good cause.