Term Sheet — Thursday, December 21

THE RIDE-HAILING WARS

Good morning, Term Sheet readers.

Let’s start the morning with a bombshell new financing round: Didi Chuxing, China’s ride-hailing company, raised $4 billion in fresh funding. The fundraising values Didi at approximately $56 billion and lifts cash reserves to $12 billion. Investors include the Abu Dhabi state fund Mubadala Capital. Existing investor Softbank (of course) also participated in this round. The company previously raised $13 billion from investors such as Alibaba, Tencent and Apple.

Didi, the world’s second most valuable startup, has raised almost as much money as all of the Chinese technology IPOs combined in the U.S. This year, according to the South China Morning Post.

The company said the new funding will be used for artificial intelligence research, international expansion, and new business initiatives, including development of green energy vehicle service networks. “With a substantial cash reserve, DiDi plans to scale up investments in AI talent and technologies, to further build up its intelligent driving and smart transportation capabilities,” Didi said in a statement.

International expansion is the key phrase here. Flush with cash, expect this tech giant to flex its muscles in the United States even further. It has expanded rapidly overseas in the last year, and reinforced its dominance by acquiring Uber’s China operations, investing $100 million in Lyft, and leading a $2 billion round in Grab.

Earlier this month, Didi said it plans to enter Mexico next year and Taiwan in the near future. Meanwhile, Didi’s main rival Uber received its biggest setback yet in Europe this week after EU’s top court ruled that it should be regulated as a transportation company. It’s also dealing with a leak of 57 million rider/driver records and revelations that the company spied on competitors.

Having said that, Didi remains a China-focused business where it accounts for 99% of the car-hailing market thanks to its 300 million customers in over 400 cities. Still, I fully expect Didi to give Uber a run for its money in 2018. The Chinese behemoth is building up its war chest to win market share in new places at a time when Uber is wrapping up a scandal-ridden year. Take a seat because this will be a ride-hailing battle worth watching.

MAKING THE LEAP: Six years and $2 billion later, Magic Leap finally unveiled its augmented reality goggles. The Magic Leap One Creator Edition headset features goggles, an external battery pack, and a handheld device. Rolling Stone got a demo of the product. Here’s an excerpt:

“Abovitz also declined to give me a ship date or price. But he did say that there is no doubt that the first version will ship in 2018. As for the cost: ‘So we have an internal price, but we are not talking about that yet,’ he says. ‘Pre-order and pricing will come together. I would say we are more of a premium computing system. We are more of a premium artisanal computer.’

Despite not answering a number of key questions, the day spent wandering the hallways and byways of Magic Leap left me with a much clearer sense of what the company was up to – that it wasn't just about the headset, or even the light field tech that's driving it. Magic Leap, in releasing their system to the world, is combining a slew of technologies into something that could one day reinvent the way we deal with all technology.”

Although the company has yet to release a product to consumers (the first version of Magic Leap’s device is for developers), this hasn’t stopped investors from pouring money, reporters writing stories, and the overall hype building. Magic Leap could be developing the most disruptive technology of our lifetime … or it could fail to meet the overblown expectations it’s built up over the years.

ONE FUN THING: After weeks of receiving holiday e-cards addressed to {{MediaContactFirstName}}, I received the one the entire tech community awaits each year (no? Just me?). First Round Capital, a San Francisco-based seed-stage venture firm, released its annual holiday video. Each year, the music video is lighthearted and entertaining, featuring First Round’s partners and portfolio company founders lip-syncing and referencing a handful of the year’s tech headlines. The lyrics have previously been modified to chart-toppers including Taylor Swift’s “Shake It Off,” Hamilton’s “You’ll Be Back,” Drake’s “Hotline Bling,” and Psy’s “Gangnam Style.”

Over the years, the videos have grown more elaborate and more ridiculous as the annual tradition has turned into an obviously time-consuming and capital-intensive production. Just look at the difference between First Round’s 2008 and 2016 music videos.

This year is different.

There’s no lip-syncing, no coordinated dancing, and no parodies. For the holiday video’s 10th anniversary, First Round decided to go back to its roots and produce something much less flashy. In a nod to its first video, it shows a compilation of portfolio company members dancing in a low-maintenance setting.

“Rather than spend money on expensive production value, we will be donating our holiday video budget to nonprofits working to improve diversity and inclusion in the tech ecosystem,” the video notes, alluding to a year of sexual harassment allegations that have rocked the tech community.

First Round told Term Sheet it donated more than $25,000. This is an action that speaks louder than any lip-synced lyric could.

Watch the full video here.

THE LATEST FROM FORTUNE...

• Why Bitcoin’s high price may be unsustainable (by Adam Lashinsky)

• India’s stocks could be big winners in 2018 (by Lucinda Shen)

• 3 retail stocks that Amazon won’t crush (by Ryan Derousseau)

• Apple wins big with U.S. Tax bill but it faces a snag

VENTURE DEALS

• Ripcord, a Hayward, Calif.-based robotic digitization company, raised $25 million in funding. GV led the round, and was joined by investors including Telstra Ventures, Icon Ventures, Kleiner Perkins, Lux Capital, and Silicon Valley Bank.

• Framer, a Netherlands-based prototyping and developer handoff tool, raised $7.7 million in Series A funding. Accel led the round, and was joined by investors including Foundation Capital, Designer Fund and AngelList.

• Nylas, a San Francisco-based company providing APIs for email, calendars, and contacts, raised $4 million in funding. 8VC led the round, and was joined by investors including Rubicon, Great Oaks and Crunchfund.

PRIVATE EQUITY DEALS

• Berkshire Partners and TPG Growth agreed to invest $275 million in Precision Medicine Group, a Bethesda, Md.-based provider of an integrated infrastructure that supports pharmaceutical and life sciences companies. Oak Investment Partners and J.H. Whitney also participated.

• Equistone Partners Europe acquired a majority shareholding in the Dugas Company, a promoter and exclusive distributor of high-end spirits headquartered in Paris. Financial terms weren't disclosed.

• FFL Partners acquired Autism Learning Partners, a Glendale, Calif.-based provider of Applied Behavior Analysis therapy. Financial terms weren't disclosed.

OTHER DEALS

• Penske Media Corporation acquired a controlling interest in Wenner Media, the parent company of the iconic magazine Rolling Stone. PMC will invest in Wenner Media at a valuation just over $100 million, according to media reports. BandLab, a company that acquired a 49% share of the magazine, will retain its stake. Read more at Coins2Day.

EXITS

• Littlejohn & Co., LLC and Strategic Value Partners, LLC sold GSE Holding, Inc., a Houston, Texas-based provider of geosynthetic containment solutions for environmental protection and confinement applications, to Groupe Solmax Inc. Financial terms weren't disclosed.

• Ooma, Inc. (NYSE: OOMA ) acquired Butterfleye, Inc., a San Mateo, Calif.-based AI-powered video camera and security platform. Financial terms weren't disclosed. Butterfleye raised approximately $4 million in venture funding from investors including BRC Innovation, Slow Ventures, and Jason Calacanis.

• Gen Cap America, Inc sold Thomas Pipe & Supply, a Phoenix, Ariz.-based distributor of industrial pipe, valves and fittings, to Winsupply Inc. Financial terms weren't disclosed.

• GreenSpace Brands Inc agreed to buy Galaxy Nutritional Foods Inc, which owns the Go Veggie brand, for $17.8 million. Mill Road Capital was the seller.