Term Sheet — Wednesday April 18

On Crypto

Good morning, Term Sheet readers.

Robert Hackett here, once again standing in for Polina.

Last night at Coins2Day’s annual Brainstorm Tech dinner in San Francisco, Chain CEO Adam Ludwin regaled attendees with his astute take on cryptocurrencies. Virtual money represents “the new Internet counterculture,” he said, and the movement stands in contrast to today’s Silicon Valley establishment: old fogies like Alphabet, Facebook, et al. (I have yet to debrief with the evening’s moderator, Coins2Day’s Adam Lashinsky, who was not hot on Bitcoin last I checked.)

While I was not in attendance at the meal, I have spoken to Ludwin on many prior occasions. In fact, he was responsible for much of my early education about blockchains, the distributed accounting ledgers at the heart of Bitcoin and other cryptocurrencies. One of my earliest stories for Coins2Day consisted of a sleepless dispatch from a two-day Bitcoin hackathon at New York University that was sponsored, in part, by Ludwin’s company (before it pivoted to enterprise software). We stayed up much of the night, and he introduced me to the technical underpinnings of bank-less money.

If cryptocurrency represents the new counterculture, as Ludwin says, then the punks are already growing up. This morning, Intangible Labs, the startup behind a project formerly known as Basecoin, said it raised $133 million in a new fundraising round led by Bain Capital Ventures. Like an adolescent casting off a childhood nickname, the team dropped “coin” and rebranded its forthcoming product to Basis. Other participants in the funding round include venture capital firms, such as Lightspeed Ventures, Alphabet’s venture arm GV, and Andreessen Horowitz, as well as cryptocurrency hedge funds, such as Metastable, Polychain Capital, and Pantera Capital, among others.

Basis aims to eradicate the fun—er, volatility—from cryptocurrency. To date, much of cryptocurrency’s rise has been due to speculative investor activity, excited by quick, wild price swings. Basis is designing a blockchain to eliminate those market uncertainties. Its token, which the company says will initially be pegged to the value of one U.S. Dollar, strives to become a legitimate medium of exchange, a true crypto-currency as opposed to a crypto-commodity, like Bitcoin. The team wants to build a decentralized, autonomous central bank at the most fundamental, protocol level. In theory, algorithms will control the monetary supply, keeping the market value stable.

“Our thesis is that the volatility of cryptocurrency is preventing their mainstream adoption,” Nadar al-Naji, Basis’s CEO and cofounder, told me on a call. “Basis is a cryptocurrency with an algorithmic central bank designed to adjust the supply of cryptocurrency to keep purchasing power stable.” That way, fiat-skeptics can one day pay out salaries in Basis without having to worry about the crypto-economy’s boom and bust hyper-cycles, so the thinking goes.

Salil Deshpande, a managing director at Bain who led the deal, told me on a call that he foresees Basis having both short-term and long-term market potential. First, the coin is a natural fit for cryptocurrency traders who need a way to move between online exchanges while avoiding price collapses or surges. A rival coin, Tether, has proven this out, he said. On a longer timeline, Basis could help foster commerce, especially in developing countries with unreliable central banks. (You can read Deshpande’s reasoning in a Medium essay he penned.)

If you’re interested in learning more about Basis and so-called “stable-coins,” tune into Coins2Day’s new show, Balancing The Ledger, set to air Friday around 11 a.m. ET. We’ve invited Basis’s al-Naji on as a guest this week. Also, subscribe to Coins2Day’s forthcoming newsletter, The Ledger, where we’ll keep you up to date with insights on all the latest fintech, crypto, and blockchain trends.

While we’re on the subject of counterculture—and since I don’t get to man Term Sheet very often—I’ll make note of another interesting deal that crossed the wire this morning. Green Bits, a startup that supplies software to marijuana merchants, announced a $17 million fundraising round led by Tiger Global. The New York-based investment firm, which once backed Facebook and LinkedIn, now finds itself making deals alongside Snoop Dogg, whose VC firm Casa Verde Capital joined the round. Looks like John Boehner isn’t the only who see potential in the green stuff. Just in time for 4/20, too.

Ping deals to [email protected].

More deals below.

THE LATEST FROM FORTUNE...

• Tesla CEO Elon Musk's New Model 3 Target: 6,000 Per Week By End of June (by Kirsten Korosec)

• Parkland Survivor Wants Investors to Boycott BlackRock and Vanguard (by Chris Morris)

• Chain CEO Adam Ludwin Talks Cryptocurrencies and Counterculture (by Jonathan Vanian)

• New York's Attorney General Wants to Know What the Winklevoss Twins Are Doing to Protect Cryptocurrency Customers (by David Meyer)

...AND ELSEWHERE

A better-than-expected quarter for Morgan Stanley. Susan Fowler backs end to forced arbitration. The first millennial-led female VC. Cambridge Analytica’s ICO. Alibaba to jump into the self-driving business. Amazon teams up with Best Buy. Satellite project draws in Bill Gates, SoftBank.

VENTURE DEALS

• Basis, a Hoboken, N.J.-based firm seeking to create a stable cryptocurrency, raised $133 million in funding. Bain Capital Ventures, GV, Stanley Druckenmiller, Kevin Warsh, Lightspeed, Foundation Capital, Andreessen Horowitz, Wing VC, NFX Ventures, Valor Capital, Zhenfund, INBlockchain, Ceyuan, Sky9 Capital, and others invested in the firm.

• Tala, a Santa Monica, Calif.-based financial services firm for underserved consumers, raised $50 million Series C funding. Revolution Growth led the round and was joined by investors including IVP, Data Collective, Lowercase Capital, Ribbit Capital, and Female Founders Fund. Tala also raised an additional $15 million to power its loan book.

• Project44, a Chicago-based global shipping firm, raised $35 million in funding. OpenView led the round, and was joined by investors including 8VC, Emergence Capital, Omidyar Technology Ventures, Chicago Ventures, and Pritzker Group Venture Capital.

• Applitools, a San Mateo, Calif.-based AI app testing firm, raised $31 million in Series C funding. OpenView led and was joined by investors including Sierra Ventures, Magma Venture Partners, iAngels, and La Maison.

• Eightfold.ai, a Mountain View, Calif.-based hiring platform, raised $18 million in Series B funding. Lightspeed and Foundation Capital led the round the round.

• Green Bits, a San Jose, Calif-based compliance platform that helps cannabis dispensaries and retailers run their businesses, raised $17 million in Series A funding. Tiger Global, led the round and was joined by investors including Casa Verde Capital.

• Vicarious Surgical, a Cambridge, Mass-based robotic surgery firm, raised $16.75 million in Series A funding. Khosla Ventures and Innovation Endeavors led the round the round, and was joined by investors including Gates Ventures, AME Cloud Ventures, and Marc Benioff.

• RapidSOS, a New York-based emergency technology company, raised $16 million in funding. Highland Capital Partners led the round and was joined by investors including Microsoft Ventures and CSAA Insurance Group.

• BookingBug, the Boston-based scheduling platform, raised $13.4 million in Series C funding. PeakSpan Capital and Downing Ventures led the round.

• Wonolo, a San Francisco-based staffing platform enabling businesses to fill their immediate labor needs, raised $13 million in a Series B funding round led by Sequoia Capital.

• Parsley Health, a New York-based personalized healthcare firm, raised $10 million in funding. FirstMark Capital led the round and was joined by investors including Cleveland Clinic Center for Functional Medicine, Amplo, Trail Mix Ventures, Combine and The Chernin Group.

• Squarefoot, a New York-based workspace-seeking platform, raised $7 million in funding. Rosecliff Ventures led the round and was joined by investors including RRE Ventures, Triangle Peak Partners, and Armory Square Ventures. More.

• Node, a San Francisco-based AI-powered discovery engine, raised $5 million in funding. Recruit Strategic Partners, WndrCo, David Brewer of Aragon Capital, Linnea Roberts of GingerBread Capital, Falmouth Ventures, and Marc Weiss of Open Field Capital were the investors.

• Nano-C, a Westwood, Mass.-based developer of nanostructured carbon for energy and electronics applications, raised $11.5 million in funding, including a $3 million tranche from Ray Stata, cofounder and current chairman of Analog Devices.

PRIVATE EQUITY DEALS

• Monogram Capital Partners invested in Ellenos, a Seattle-based Greek yogurt brand. Financial terms weren't disclosed.

• Falfurrias Capital Partners invested in Tax Guard, a Boulder, Colo.-based a proprietary data and services firm for lenders.

• Arsenal Capital Partners took a majority interest in Fralock, a Valencia, Calif.-based manufacturing firm. Financial terms weren't disclosed.

• Gauge Capital recapitalized American Nuts, a Sylmar, Calif.-based supplier and processor of nuts, seeds, and dried fruit. Financial terms weren't disclosed.

• GI Partners acquired Consilio, a Washington D.C.-based document review, and legal consulting services. Consilio was combined with Advanced Discovery. Financial terms weren't disclosed.

• Vista Equity Partners acquired LogicMonitor, a Santa Barbara, Calif.-based performance tracking firm. Financial terms weren't disclosed.

• Castle Harlan acquired the North American production equipment manufacturing assets of Exterran Corp., a Houston-based oil and gas firm. Financial terms weren’t announced. The new firm will be called Titan Production Equipment.

OTHER DEALS

• BCB Bancorp (NASDAQ:BCBP) acquired IA Bancorp and its subsidiary, Indus-American Bank, of Edison, N.J. Indus-American Bank has been merged with and into the Bank. IA Bancorp shareholders will receive $2.55 million in cash and 631,994 shares of the BCB common stock.

• SS&C, a Windsor, Calif-based financial software firm, acqui red DST systems, a Kansas City-based tech firm, for $5.4 billion.

• HighTower, a Chicago-based investment advisors, acquired Salient Private Client, the New York-based wealth management business of Salient Partners.

EXITS

• Ward Energy Partners, a Fort Collins, Colo.-based energy firm, sold assets located in Adams and Weld Counties in Colorado to an undisclosed buyer.

• VizExplorer, a San Diego, Calif.-based analytics platform for the casino industry, raised an undisclosed amount of funding from Morgan Stanley Expansion Capital. Endeavor previously held the firm and will continue to have a minority investment in the company.