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February 5, 2021
Friday! Another week in the books!
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Before we go, we leave you with newest StrictlyVC Download, featuring founder-VC Alexa von Tobel, who sold her fintech company for $375 million back in 2015, then jumped straight into full-time investing, eventually cofounding Inspired Capital with fellow entrepreneur Penny Pritzker. Inspired has startup bets across numerous industries, but we wanted von Tobel's take especially on GameStop, Robinhood, and what she sees as the biggest underlying issue of the last two weeks. We really enjoyed the conversation; hope you will, too.
Giant thanks to this episode's sponsor, NordVPN, the virtual private network provider that promises to protect your internet activity from prying eyes. You can learn more here, as well as get a discount on a two-year plan (plus an additional one month).
P.S.: We're updating our media kit and could use your help if you can spare just five seconds to fill out this survey. It's just a handful of bubbles to click -- no names or identifying info required. (And thank you!)
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Top News
Microsoft today said its political action committee won’t contribute to upcoming campaigns for members of U.S. Congress who voted against confirming the Electoral College results of the 2020 presidential election. Former Attorney General William Barr said in December that the Justice Department had not seen enough fraud that it could have caused a different outcome in the presidential election. CNBC has more here.
Senator Mark Warner is set to introduce a bill that could hold Facebook, Google and other tech giants more directly accountable when viral posts and videos result in real-world harm. The measure is dubbed the Safe Tech Act, and it marks the latest salvo from congressional lawmakers against Section 230. The Washington Post has more here.
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Two New Efforts Could Widen the Pool of People Investing Directly in Venture Funds
Venture funds have historically counted on several types of investors -- or limited partners -- for their investing capital. One of these groups is institutional investors -- think pension funds, university endowments, hospital systems and the like. Another is corporations. A third bucket centers on wealthy individuals and sometimes their family offices.
It's a fairly small universe, in other words, but two new initiatives, both announced this week and both very different, are looking to change the equation and could usher in similar efforts soon.
Arlan Hamilton came out with her news first. Hamilton is the founder of Backstage Capital, a venture firm focused on investing in startups founded by people of color, women, and members of the LGBTQ community. In short, diversity is at its very core. But Hamilton, who is herself Black, isn't interested in funding diverse founders alone; she is also interested in enabling more people from diverse backgrounds -- including socioeconomically -- to invest in venture capital as an asset class.
Toward that end, earlier this week, on the private investing platform Republic, she opened a new fund that anyone -- including unaccredited investors -- could back under a Securities and Exchange Commission rule called Reg CF, or Regulation Crowdfunding.
Hamilton hit the upper boundary of what Reg CF allows an outfit to raise -- $1,070,000 within a 12-month period -- in what seemed like hours from 2,790 investors who were invited to invest as little as $100. But more could be coming. The reason why: that rule underwent a change in November under former SEC chair Jay Clayton, and will next month begin allowing outfits to crowdsource up to $5 million.
The process could be slowed down by the incoming SEC chief. President Biden has appointed former regulator and former Goldman partner Gary Gensler, who must now receive Senate confirmation. The new administration is also reviewing many of the measures moved along late in the Trump administration. If it's all systems go, however, it's easy to imagine more unaccredited investors being invited to fund other, and larger, venture funds soon.
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Massive Fundings
Powin Energy, a 10-year-old, Portland, Ore.-based energy startup that buys battery cells and hooks them up with proprietary software controls and ancillary equipment to produce full-fledged power plants, has raised more than $100 million in funding to compete with better-funded rivals like Tesla. Investors in the new round include Trilantic, a private equity firm, and Energy Impact Partners. Greentech Media has more here.
Big-But-Not-Crazy-Big Fundings
Imperfect Foods, a 5.5-year-old, San Francisco-based company that began its operations by delivering fresh produce to consumers that was in surplus or deemed ugly, has tacked on $15 million more to a $95 million Series D funding it announced two weeks ago led by Insight Partners and Norwest Venture Parters. Its newest backers are Hamilton Lane and Blisce. The company is on a fundraising tear, having closed a Series C round, also led by Insight, just eight months ago. More here.
Smaller Fundings
Tickr, a 2.5-year-old, U.K.-based startup whose app invites consumers to make financial investments based on their impact on society and the environment, has raised £2.5 million ($3.4 million) in funding lead by Ada Ventures. TechCrunch has more here.
Twinco Capital, a four-year-old, Madrid- and Amsterdam-based startup making it easier to access supply chain finance, has raised €3 million in funding led by fund Mundi Ventures, with participation from previous backer Finch Capital and several unnamed angels. TechCrunch has more here.
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New Funds
Frontline Ventures, an eight-year-old, Dublin, Ireland-based venture firm with offices in San Francisco and London, has raised a new seed fund -- its third -- with €70 million ($83.8 million) in capital commitments. Some of the firm's limited partners include the European Investment Fund, Ireland Strategic Investment Fund and the Irish banking giant AIB. TechCrunch has more here.
Igah Ventures, a nine-year-old, Sao Paulo, Brazil-based venture capital firm, has raised a $130 million fund dedicated to Brazil’s upstart companies, with SoftBank Group as one of its investors. The firm already started deploying the money and made six investments, says Bloomberg. More here.
SJF Ventures, a 21-year-old, Durham, N.C.-based venture firm with offices in San Francisco and Seattle, has garnered $175 million in capital commitments for its fifth fund. The outfit invests in a broad spectrum of startups, including those focused on clean energy and the climate, logistics, mobility and govtech, health, education, the future of work, and sustainable food. AltAssets has more here.
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Exits
A look at how proptech startup Knotel went from a $1.6 billion valuation to bankruptcy.
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Going Public
Oscar Health, the nearly nine-year-old, New York-based health insurance start-up, filed for IPO today. The outfit, which enables scheduling physician visits, checking lab results, emergency virtual appointments and prescription refill through its mobile app or online platform, was founded by Mario Schlosser; Kevin Nazemi, who is no longer a part of the company; and Josh Kushner. Reuters has more here and the public filing is here if you're curious to see who owns how much.
The IPO market had its busiest week yet this year with 14 IPOs raising $3.9 billion and 27 SPACs raising $9.2 billion. The IPO pipeline remained active as well, with 3 IPOs and 38 SPACs(!) submitting initial filings. Renaissance Capital takes a look here.
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People
Summit Partners has brought in veteran private equity exec Bob Grady as an advisory partner based in the firm’s Boston office where the firm says he'll work closely with Summit’s investment team to identify and originate new investment opportunities. More here.
Founder and CEO Whitney Wolfe Herd is expected to take her company, Bumble, public with a female chair and women occupying eight spots on its 11-member board, a rarity in corporate boardrooms. The Washington Post has more here.
Information Venture Partners, a Toronto-based venture firm that primarily invests in early-stage North American B2B fintech and enterprise software companies, has appointed Jane Podbelskaya as principal. Podbelskaya most recently worked at Georgian Partners, which invests in growth-stage SaaS companies. AltAssets has more here.
Founders Fund, the San Francisco venture capital firm, is reportedly joining the migration to Miami. The firm signed a one-year lease for office space, saying it plans to expand its operations in Miami in 2021. A growing list of technology executives, including Peter Thiel, Keith Rabois, Shutterstock founder Jonathan Oringer, Blumberg Capital founder David Blumberg and former Uber chief business officer Emil Michael have also landed in the area over the past year, reports the South Florida Business Journal.
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Data
The cryptocurrency ether hit a fresh all-time high today, surging past $1,700 for the first time. Ether, which is the world’s second-largest digital coin by market value, climbed 11.2% to a price of $1,743 at around 10:30 a.m. ET, according to data from CoinDesk. More here.
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Essential Reads
Clover Health Investments responded to allegations made by short-seller firm Hindenburg this week, acknowledging it did not disclose inquiries made by the Department of Justice about its business prior to its IPO through a SPAC backed by investor Chamath Palihapitiya, but characterizing the inquiries as standard practice. Clover also said it received a letter from the SEC yesterday and that it intends to cooperate. CNBC has more here.
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Retail Therapy
A pair of autographed Air Jordan 1s get listed for an ambitious $1 million.
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