TikTok aims to avoid full sale of US unit

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The Daily Pitch: VC

September 10, 2020

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Today's Top Stories

TikTok looks to avoid sale in the US

TikTok's owner, ByteDance, is in talks with the US government to avoid a complete sale of the video app's US business, according to The Wall Street Journal.

If there isn't a full sale of the US unit, a deal could instead involve some restructuring of TikTok, the report said. TikTok could partner with a US technology company that would help secure its data and possibly take a minority stake in the business.

The latest development comes after the Chinese government recently imposed export restrictions that would require a license for ByteDance to sell its technology to a foreign company. That posed a roadblock for the Beijing-based company, which also faces a Sept. 15 deadline imposed by President Trump to sell TikTok or face being shut down in the US.

A joint bid from Microsoft and Walmart and a competing offer from Oracle are said to be the frontrunners for a possible TikTok deal in the US.

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VC, PE vehicles lead private fund performance in 2019

As 2019 wound to a close, the prospect of a pandemic was still very far from most investors' minds. As expected in a quarter in which the S&P 500 was up 9.1%, the performance of private market funds finished last year on an upswing, with one-year horizon IRRs for both venture capital and private equity funds approaching 16%.

Updated with data through the end of 2019, PitchBook's latest Global Fund Performance Report compares those one-year figures both to other private strategies and to data from much longer investment horizons. The report also features copious amounts of fund analysis and data visualization to offer a full picture of how private funds have fared:

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A message from The Wellness Agency

Wellness is a new vertical of unicorns

The Wellness Agency supports founders in achieving their maximum potential while nurturing a global ecosystem of companies mainstreaming wellness for the benefit of humanity. TWA is headquartered in Venice, Calif., the hub of the global wellness industry as Silicon Valley is to technology.

We provide founders with a premier, vetted ecosystem to holistically scale their businesses and support growth in four key areas: incubator services, strategic partnerships, direct-to-consumer strategy, and market entry to China. In 2018, global wellness expenditure was valued at $4.5 trillion and growing 6-7% annually. TWA's services are tailored to drive revenue and add value for founders with a structure to embrace and amplify emerging sectors such as psychedelics for mental health wellness, hemp-based supercapacitor batteries, and male fertility.

Read more here

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David Beckham and Guild Esports seek to score with rare IPO

David Beckham (Michael Reaves/Getty Images)

Less than three months ago, a new esports team co-founded by soccer legend David Beckham made its official launch, with hopes of bringing in VC at a valuation of £100 million (about $130 million). Those fundraising dreams fizzled. And now, Guild Esports is going public instead.

The company's coming move to the public market represents a bet on three things—the rise of esports during the pandemic, Guild's internal star power and the novelty of conducting the UK's first esports IPO:

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Predictive policing is a common trope in dystopian science fiction—think "Minority Report." In one Florida community, it's turned into a troubling reality. [Tampa Bay Times]

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Quick Takes


	The Daily Benchmark
	2011 Vintage Global Real Assets Funds
	VC Deals
	Recursion Pharma reels in $239M, partners with Bayer
	Sprinklr valued at $2.7B with latest funding
	Cybersecurity startup Snyk hits $2.6B+ valuation
	Carlyle leads $175M digital health deal
	Plant-based food startup harvests $85M
	Truepill pockets $75M
	Xometry gets $75M
	Spark Capital funnels $30M into Deel
	Portfolio Companies
	Long-Term Stock Exchange opens for business
	Exits & IPOs
	Oncology unicorn Grail files for IPO
	Outset Medical readies $175M debut
	Clickbait companies walk away from $2B combination

The Daily Benchmark

2011 Vintage Global Real Assets Funds

Median IRR

13.01%

Top Quartile IRR Hurdle Rate

19.36%

1.45x

Median TVPI

Select top performers

C-III Recovery Fund I

Exeter Industrial Value Fund II

FIP Lantánidos

*IRR: net of fees

71 Funds in Benchmark »

Check out the latest version of PitchBook Benchmarks

VC Deals

Recursion Pharma reels in $239M, partners with Bayer

Drug discovery startup Recursion Pharmaceuticals has raised $239 million in Series D funding led by a $50 million investment from Leaps by Bayer, the drug giant's impact investing arm. Based in Salt Lake City, the clinical-stage biotech company uses experimental biology, automation and AI to develop treatments for cancer, genetic diseases, inflammation and infectious diseases. Recursion has also begun a strategic collaboration with Bayer to develop treatments for fibrotic diseases.

Select Additional Investors:

Advantage Capital, Samsara BioCapital, EPIC Ventures, Felicis Ventures, Two Sigma Ventures, Obvious Ventures, Intermountain Ventures

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Sprinklr valued at $2.7B with latest funding

Sprinklr, the developer of a customer experience management platform, has been valued at $2.7 billion after raising $200 million from Hellman & Friedman. Sprinklr has also secured $150 million in convertible securities from the growth arm of investment firm Sixth Street. Founded in 2009, the New York-based company was valued at $1.8 billion with a $105 million round in 2016, according to PitchBook data.

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Cybersecurity startup Snyk hits $2.6B+ valuation

Snyk has closed a $200 million Series D led by Addition that values the cybersecurity startup at more than $2.6 billion. With customers including Google and Salesforce, Snyk provides container, application and infrastructure security for developers. The Boston-based startup has raised around $450 million in total funding, including a $150 million round in January that valued it at $1.05 billion, according to PitchBook data.

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Carlyle leads $175M digital health deal

The Carlyle Group has led a $175 million investment in Grand Rounds, a San Francisco-based digital healthcare company that provides telehealth and related services to workers at Walmart, Home Depot, Salesforce and more than 125 other employers. Grand Rounds has raised prior backing from Greylock Partners, Venrock, Adams Street Partners and others, reaching a $750 million valuation in 2018, according to PitchBook data.

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Plant-based food startup harvests $85M

NotCo has raised an $85 million Series C co-led by Future Positive and L Catterton. Other investors including Kaszek Ventures, General Catalyst, Humboldt Capital and Maya Capital also participated. Founded in 2015, the Santiago, Chile-based foodtech company uses AI to produce plant-based food and beverages. It caters to Latin American markets including Chile, Brazil and Argentina, with plans to expand operations into the US.

Additional Investors:

The Craftory, Bezos Expeditions, Endeavor Catalyst, IndieBio

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Truepill pockets $75M

Truepill has raised a $75 million Series C led by Oak HC/FT, with participation from Optum Ventures, TI Platform Management, Sound Ventures and Y Combinator. The Bay Area-based business offers a platform that allows healthcare companies to deliver prescriptions directly to consumers. It plans to use the funding to launch a network for at-home lab testing.

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Xometry gets $75M

Xometry, the provider of an online quoting portal and on-demand manufacturing marketplace, has raised $75 million in a round led by T. Rowe Price. Durable Capital Partners and ArrowMark Partners also participated in the funding. Based in Maryland, Xometry raised $55 million in July 2019 at a $370 million valuation, according to PitchBook data.

Additional Investors:

BMW i Ventures, Greenspring Associates, Dell Technologies Capital, Robert Bosch Venture Capital, Foundry Group, Highland Capital Partners, Almaz Capital

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Spark Capital funnels $30M into Deel

San Francisco-based Deel has raised a $30 million Series B led by Spark Capital. Founded in 2018, the company is the developer of a payroll and compliance platform designed for remote teams. Deel has received prior funding from Andreessen Horowitz, Y Combinator and others.

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Portfolio Companies

Long-Term Stock Exchange opens for business

The Long-Term Stock Exchange has begun trading securities in the US. The LTSE is designed to promote long-term company growth rather than short-term financial results. To list on the exchange, companies are required to maintain policies that focus on their long-term goals. LTSE has raised funds from venture capital firms such as Andreessen Horowitz, Founders Fund and Collaborative Fund.

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Exits & IPOs

Oncology unicorn Grail files for IPO

Grail, the developer of a blood test that's designed to detect early-stage cancer, has filed for an initial public offering on the Nasdaq. The Menlo Park-based company does not yet generate revenue and posted a net loss of $245 million in 2019. Grail has raised around $2 billion from investors including Illumina (14.6% pre-IPO stake), Arch Venture Partners (9.5%) and Johnson & Johnson (7.6%), reaching a valuation of $3.84 billion following a Series D in May, according to PitchBook data.

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Outset Medical readies $175M debut

Outset Medical, a San Jose-based healthcare company developing kidney dialysis technology, has revealed plans to sell 7.6 million shares for between $22 and $24 apiece in its upcoming IPO on the Nasdaq, with a midpoint pricing set to raise nearly $175 million and value the company at more than $910 million. Outset has raised some $475 million in prior funding from backers including Warburg Pincus (28% pre-IPO stake) and Fidelity Management & Research (14.8%), reaching a $725 million valuation earlier this year, according to PitchBook data.

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Clickbait companies walk away from $2B combination

Taboola and Outbrain, two venture-backed companies that provide online publishers with advertising-based content recommendations, have called off a merger agreement, according to reports. The deal, originally agreed to in October, called for Outbrain shareholders to receive $250 million in cash and 30% of the combined business, with TechCrunch reporting the move would have created a company worth $2 billion.

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