Axios Pro Rata: Inexcusable economics — Affirm IPO — Liberty Media SPAC

Top of the Morning | Thursday, November 19, 2020

Open in app View in browser   Presented By Goldman Sachs   Pro Rata By Dan Primack ·Nov 19, 2020 🎧 Axios Re:Cap focuses on Joe Biden's plan to forgive student debt. Listen via Apple, Spotify or Axios.     Top of the Morning Illustration: Sarah Grillo/Axios   Congress goes on vacation next week, after months spent hardly working on an economic stimulus that almost everyone agrees was needed months ago. This failure was disheartening in May. It was frustrating in August. It was maddening earlier this month. Today it's whatever adjective best describes the compulsion to slam your head against a concrete wall. The difference between now and then is that we can see a light at the end of the pandemic tunnel, thanks to vaccine trial results from Pfizer and Moderna. That means we know more about what's needed and for how long it's needed, neither of which were really true when the CARES Act was passed in March. We also know now that America is in the midst of a third COVID-19 wave that is only expected to get worse, particularly after a Thanksgiving holiday that may double as a national super-spreader event. Many businesses — including a lot of Northern state restaurants that have been eking by on outdoor dining — are unlikely to survive until a Biden inauguration (or even until the Georgia run-offs). More jobs will be lost. In addition, upwards of 12 million Americans could lose their unemployment benefits the day after Christmas, as CARES Act provisions expire. This list of horribles is manifest. Yet there are zero negotiations happening right now on stimulus, according to Axios political reporter Alayna Treene. The bottom line: Elected officials of both parties, including President Trump, are failing the country. Not only by not succeeding in getting new stimulus passed, but by no longer even trying. The time for apportioning partisan blame has passed. The elections are over, so it's no longer defensible for leaders to wait until their "side" has more leverage. Every business or job saved, every family enabled to avoid eviction, should now be the priority. Every vacation day is a cruelty, brought to us by what is becoming the lamest of ducks.     The BFD Illustration: Annelise Capossela/Axios   Affirm, a San Francisco-based provider of personal installment loans for online purchases, filed for an IPO that's expected to value the company at upwards of $10 billion. Why it's the BFD: The company is led by PayPal co-founder Max Levchin and is riding a pandemic wave of e-commerce purchases of home office products, home furnishings, and home fitness equipment. Financials: Affirm reports a $108 million net loss on $509 million in revenue for the year ending June 30, 2020, versus a $127 million net loss on $264 million in revenue for the year-earlier period. Investors: The company raised around $1.6 billion from such firms as Khosla Ventures, Founders Fund, Lightspeed Venture Partners, Spark Capital, Thrive Capital, Fidelity, Wellington Management, GIC, Durable Capital Partners, Baillie Gifford, GGV Capital, Battery Ventures, Andreessen Horowitz and Ribbit Capital. Behind the scenes: A source close to Affirm tells me that while several SPACs reached out to the company, the company never seriously engaged: "Max was committed to IPO from Day 1." Bottom line: Investors may worry that what the pandemic giveth, the pandemic may taketh away. A whopping 28% of Affirm's sales for the year ending in June were related to Peloton, while that percentage climbed to 30% in Q3 2020.     Venture Capital Deals • SellerX, a German startup that seeks to roll up small e-commerce companies that use Fulfillment by Amazon, raised €100 million. Cherry Ventures, Felix Capital and TriplePoint Capital co-led, and were joined by Village Global, Chris North (ex-CEO of Amazon UK) and the founders of KW Commerce. http://axios.link/rmJv 🚑 Pharvaris, a Swiss developer of alternatives to injected therapies for treating hereditary angioedema, raised $80 million in Series C funding. Viking Global Investors and General Atlantic co-led, and were joined by Cormorant Asset Management and return backers Foresite Capital, Bain Capital Life Sciences, VenBio Partners and Venrock. http://axios.link/I0mN • ZenBusiness, an Austin, Texas-based software platform for launching new businesses, raised $55 million in Series B funding. Cathay Innovation led, and was joined by GreatPoint Ventures, Breyer Capital, Omega Venture Partners and return backers Greycroft, Lerer Hippeau, Interlock Partners, Mark VC and ATX Venture Partners. http://axios.link/LRYu 🚑 Umoja Biopharma, a Seattle-based developer of immunotherapies for blood cancer and pediatric osteogenic sarcoma, raised $53 million in Series A funding co-led by MPM Capital and Qiming Venture Partners USA. http://axios.link/fRTQ • CAIS, a New York-based alternative investing platform, raised $50 million in Series B funding from Eldridge. www.caisgroup.com • MycoWorks, an Emeryville, Calif.-based developer of a leather alternative, raised $45 million in Series B funding. WTT Investment and return backer DCVC Bio co-led, and were joined by Valor Equity Partners, Humboldt Fund, Gruss & Co., Novo Holdings, 8VC, SOSV, AgFunder, Wireframe Ventures, Tony Fadell, John Legend and Natalie Portman. http://axios.link/iEdQ • Chipper, a provider of P2P payment services in Africa, raised $30 million in Series B funding. Ribbit Capital led, and was joined by Bezos Expeditions. http://axios.link/5AyI • Abacus.AI, a San Francisco-based developer of AI modules, raised $22 million in Series B funding. Coatue led, and was joined by Decibel Ventures and Index Ventures. http://axios.link/TdS8 • Oblogio, an Israeli fintech focused on security deposit alternatives, raised $13.5 million. 10D led, and was joined by return backers 83 North and Entrée Capital. It also secured $2 million in debt from Viola Credit. http://axios.link/Yvoo • Afresh, a provider of software for grocery stores to track demand and manage orders for fresh produce, raised $14 million. Food Retail Ventures led, and was joined by Innovation Endeavors, Maersk Growth and Baseline Ventures. http://axios.link/zsRb • Smart Protection, a Madrid-based startup that protects brands against online counterfeiting, raised €10 million in Series B funding. Knight Capital led, and was joined by CDTI, Nauta Capital, JME Ventures, Bankinter, Big Sur Ventures and Telefónica. http://axios.link/ROix • NestEgg, a Chicago-based management app for single-family and small multifamily homes, raised $7 million in Series A funding. Hyde Park Venture Partners led, and was joined by BAM Ventures, Bonfire Ventures, Financial Studio Ventures, Dreamit Ventures and Hyde Park Angels. http://axios.link/8nvU • Farmstead, a Burlingame, Calif.-based online grocer, raised $7.9 million in Series A funding led by Aidenlair Capital. http://axios.link/QEX1 • MarginEdge, a Fairfax, Va.-based restaurant management platform, raised $4 million led by Osage Venture Partners. http://axios.link/l4Fe • Coterie, a New York-based diaper maker, raised $2.75 million in seed funding. Willow Growth led, and was joined by RiverPark Ventures and M3 Ventures. www.coterie.com • Datafold, a San Francisco-based maker of data quality management software, raised $2.1 million in seed funding from NEA. http://axios.link/Kuaz • Juni, a Swedish banking app for e-commerce and online marketing, raised €2.1 million in seed funding led by Cherry Ventures. http://axios.link/ivjZ • YvesBlue, a New York-based provider of automated ESG reporting for asset and wealth management firms, raised $2 million in seed funding led by Illuminate Financial Management. http://axios.link/XYtr • Tencent Music Entertainment invested in Wave, a Los Angeles-based virtual concert company. http://axios.link/0KyA     A message from Goldman Sachs Launch With GS aims to narrow investing gaps     Goldman Sachs believes diverse management teams drive stronger returns by leveraging a broad range of perspectives to help navigate the evolving business environment. Discover Launch With GS.     Private Equity Deals 🚑 Clearlake Capital Group agreed to buy the healthcare revenue cycle management SaaS business of nThrive, an Alpharetta, Ga.-based portfolio company of Pamplona Capital Management. PE Hub puts the price tag north of $1 billion. http://axios.link/eIhx • Convex Group, a Bermuda-based specialty insurer and reinsurer focused on complex risks, secured $1 billion from a consortium that includes Onex Group and GIC. www.convexinc.com • Royal Ahold Delhaize, owner of Stop & Shop, and Centerbridge Partners agreed to buy New York-based online grocer FreshDirect, http://axios.link/7DnX • Lee Equity Partners is seeking a buyer for K-Mac, a Fort Smith, Ark.-based Taco Bell franchisee that could fetch around $900 million, per Barron's. http://axios.link/SY9s • Service Champions, a Brea, Calif.-based portfolio company of CenterOak Partners, acquired three California home services providers: Adeedo, JW Plumbing Heating & Air and A-Avis Home Services. www.servicechampions.com • Shore Capital Partners acquired Old World Spices and Seasonings, an Overland Park, Kan.-based manufacturer of custom ingredients. www.oldworldspices.com     Public Offerings 🚑 Certara, a Princeton, N.J.-based drug development consultancy owned by EQT Partners, filed for an IPO that Renaissance Capital estimates could raise $500 million. It plans to list on the Nasdaq (CERT) with Jefferies as left lead underwriter, and reports $5 million of net income on $179 million in revenue for the first nine months of 2020. http://axios.link/49Ot • NeoGames, a Luxembourg-based lottery services provider backed by William Hill, raised $82 million in its IPO. The company priced 4.8 million shares at $17 (above range), will list on the Nasdaq (NGMS) and used Stifel as lead underwriter. It reports $4 million of net income on $35 million in revenue for the first nine months of 2020. http://axios.link/AqiO 🚑 Olema Pharma, a San Francisco-based biotech focused on women's cancers, raised $209 million in an upsized IPO. The pre-revenue company will list on the Nasdaq (OLMA), used JPMorgan as lead underwriter, and had raised over $150 million in VC funding from BVF Partners (20% pre-IPO stake), Janus Capital (10.6%), Cormorant (10.3%), Logos Opportunities Fund (9.4%), RA Capital (6.3%), and Wellington Management (6.3%). http://axios.link/r5zy     SPAC Stuff • Electric Last Mile Solutions, an Auburn Hills, Mich.-based electric vehicle developer, is in talks to go public via a reverse merger with Forum Merger II (Nasdaq: FMCI), per Bloomberg. http://axios.link/NAnb 🚑 Consonance-HFW Acquisition, a life sciences-focused SPAC formed by Consonance Capita, raised $80 million in its IPO. http://axios.link/LMPP 🚑 Jiya Acquisition, a biopharma-focused SPAC formed by Samsara BioCapital, raised $1000 million in its IPO. http://axios.link/L0tA • L&F Acquisition, the second SPAC formed by Victory Park Capital, raised $150 million in its downsized IPO. http://axios.link/jFHU • Liberty Media Acquisition, a TMT and entertainment-focused SPAC formed by Liberty Media Corp., filed for a $500 million IPO. http://axios.link/xEy1 • Reinvent Technology Partners Z, the second tech-focused SPAC led by Reid Hoffman and Mark Pincus, raised $200 million in its IPO. http://axios.link/i3CC     Liquidity Events • Bain Capital is in talks to sell or list Diversey, a Fort Mill, S.C.-based food hygiene and cleaning company that could be valued at around $6 billion, per Bloomberg. http://axios.link/CdEy • IBM (NYSE: IBM) agreed to buy Instana, a Chicago-based app performance management startup that raised $57 million from firms like Accel, Meritech Capital Partners and Target Partners. http://axios.link/oojN 🚑 IVC Evidensia, a British veterinary services group backed by EQT Partners and Nestle, is exploring a sale or IPO, per the FT. http://axios.link/fz0u • Nasdaq (Nasdaq: NDAQ) agreed to buy Verafin, a Canadian provider of anti-financial crime management software, for US$2.75 billion in cash. Verafin backers include Spectrum Equity, Teralys Capital, BDC Capital, Information Venture Partners and Northleaf Capital Partners. http://axios.link/3vWY     More M&A • ABB (NYSE: ABB) is considering a sale of Dodge, its North American mechanical power transmission business, per Bloomberg. http://axios.link/fdij     Fundraising • Faber, a Portuguese VC firm, held a €20.5 million first close on its second fund, which is targeting a total of €30 million. http://axios.link/C34U • Marathon VC of Greece held a €40 million first close for its second fund. http://axios.link/Olr8 • Pike Street, a Seattle-based private equity firm focused on industrial tech, raised $237 million for its debut fund. www.pikestreetcapital.com • Qiming Venture Partners raised $1.2 billion for its seventh China-focused VC fund. http://axios.link/MO2r     It's Personnel • Lara Metcalf joined VC firm The Engine as CFO and COO. She previously was a managing director with The Social Entrepreneurs' Fund. www.engine.xyz • Bhoomica Reddy joined Centerview Partners as a managing director. She previously was an SVP in Jefferies' restructuring group. www.centerviewpartners.com • Elizabeth de Saint-Aignan joined Sun Capital Partners as a managing director who will help launch a new tech investing practice, Axios has learned. She previously was with TA Associates. The firm does not currently plan to raise a tech-specific fund. www.suncappart.com     Final Numbers Reproduced from The Leuthold Group;  Note: Subdivides the total U.S. unemployment rate between four sectors with the lowest average hourly earnings and the remaining nine sectors. Chart: Axios Visuals Go deeper: The economic recovery's split speed     A message from Goldman Sachs Supporting startups with diverse leadership     Through Launch With GS, Goldman Sachs is increasing access to capital and providing resources for diverse entrepreneurs. 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