PitchBook News - Facebook grabs Giphy in $400M deal

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The Daily Pitch: VC

May 18, 2020

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Today's Top Stories

Facebook leads big tech in pandemic-era investment push

Giphy was acquired by Facebook last week, underscoring a boom in big tech dealmaking amid a global economic crisis.
(Rob Kim/Getty Images)

As cash-hungry startups conduct layoffs and confront falling valuations, investments by tech giants are gaining steam.

Facebook's acquisition of GIF-sharing platform provider Giphy on Friday was the latest in a stream of M&A activity and investments. The social media juggernaut joined Apple, Amazon and Microsoft in setting the highest level of combined quarterly dealmaking that the group has recorded in more than a year, according to PitchBook data.

Lawmakers and regulators have continued to scrutinize big tech during the pandemic, but popular opinion of the largest players is on the rise:

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Monzo faces major valuation haircut in pursuit of fresh funding

Tom Blomfield (second from right), CEO of Monzo, which is facing a 40% valuation cut as it seeks to raise capital amid the pandemic.
(Noam Galai/Getty Images)

Monzo is closing in on a new funding round, but the digital bank's valuation is facing a steep drop of almost 40%, the Financial Times reported. Last June, the British business was valued at £1.68 billion (about $2.1 billion at the time), according to PitchBook data.

Earlier this year, Monzo was said to be seeking around £100 million in funding. Now, it's reduced that target to between £70 million and £80 million, the report said. The majority of the capital will reportedly come from existing investors. It is backed by VCs including Accel, Latitude and Y Combinator.

The decline in Monzo's valuation is largely due to the coronavirus crisis: Lockdown and the evaporation of travel have reduced card payments, hitting transaction fees. The company has reportedly furloughed some of its staff and closed a US customer service office. TechCrunch reported in March that Monzo CEO Tom Blomfield said he wouldn't take a salary for 12 months.

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A message from ON Partners

The evolving demand for leadership in PE: Insights from executive search consultants at ON Partners

Did the PE industry learn any valuable lessons from the 2008 global financial crisis? It would appear so, as the industry is poised to become even more active as a result of the coronavirus' impact.

According to Jeff Hocking, partner with executive search firm ON Partners, "Many PE firms are ramping up to deploy capital, either on potential due diligence of already troubled companies or looking for additional operating partners."

How will these pandemic-driven changes impact executive recruiting? What types of positions will PE firms and their portfolio companies be recruiting for?

The top positions are likely to be CEO and CRO, but CFOs will also be avidly recruited. For insight into why and what other drivers are shaping demand for leadership in PE and other sectors, visit onpartners.com.

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Ask PitchBook

Wondering how the pandemic is affecting your segment of the private markets? Looking for an explanation of which companies will benefit from government relief programs? Curious about what's driving a recent trend you've noticed?

Send us an email at ask@pitchbook.com, and the news team will track down the answers you're seeking.

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Recommended Reads

Open office plans have antagonized many a desk jockey. The coronavirus could shift this trend—but it might not. [City Lab]

Funeral homes have always had a difficult task. Now they must weigh matters of safety and dignity. [New York Times Magazine]

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Quick Takes


	The Daily Benchmark
	2006 Vintage Global Venture Funds with more than $250M
	VC Deals
	Discord in talks for more funds at up to $4B valuation
	Clubhouse hits $100M valuation
	Syndio collects $7.5M
	Exits
	AppLovin buys Machine Zone for $500M

The Daily Benchmark

2006 Vintage Global Venture Funds with more than $250M

Median IRR

3.56%

Top Quartile IRR Hurdle Rate

11.74%

1.28x

Median TVPI

Select top performers

Summit Partners Private Equity Fund II

Alta Partners VIII

Thomas McNerney & Partners II

*IRR: net of fees

22 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Discord in talks for more funds at up to $4B valuation

Discord, the developer of an online gaming chat app, is in talks to raise funds at a valuation of more than $2 billion, but could snag more capital at a $3 billion to $4 billion valuation, according to Bloomberg. The San Francisco-based startup was valued at $2.05 billion after a funding round in late 2018, according to PitchBook data. The company has raised over $300 million from investors including Greylock Partners, Benchmark and FirstMark Capital.

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Clubhouse hits $100M valuation

Clubhouse has raised about $12 million in a Series A led by Andreessen Horowitz, according to Forbes. The New York-based company is the developer of a voice-based project management app; it raised $16 million in 2017 at a $35 million valuation, according to PitchBook data. Andreessen Horowitz partner Andrew Chen plans to join the company's board.

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Syndio collects $7.5M

Syndio has raised $7.5 million in a round co-led by Emerson Collective and Voyager Capital. The Seattle-based company offers a platform for companies to analyze employee pay gaps related to factors such as gender and race. Syndio was valued at $21.2 million in 2018.

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Exits

AppLovin buys Machine Zone for $500M

Online video game and marketing service provider AppLovin has acquired mobile game developer Machine Zone, with Bloomberg reporting a purchase price of $500 million. Machine Zone had received prior VC funding from Menlo Ventures, Baseline Ventures and other investors. The Palo Alto-based company is the maker of games such as "Mobile Strike" and "Game of War: Fire Age." It was valued at $5 billion in 2016, according to PitchBook data.

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