It’s Not All Smooth Sailing for Facebook’s Libra Project: Term Sheet

LIBRA CONCERNS

Before Facebook’s Libra project made its public debut, it recruited high-profile backers that would act as its launch partners. They include Visa, Uber, Mastercard, PayPal and Stripe.

A New York Times report says that some of those partners are approaching Libra warily and signing non-binding agreements to join the effort so that there’s an easy out if they didn’t like the direction of the project.

Companies are hesitant to associate themselves too closely with Libra because of “Facebook’s issues with regulators around the world, the company’s shaky track record on privacy and how it treats corporate partners, and the uncertain legality of cryptocurrencies,” according to the report.

This one-foot-in-one-foot-out approach allows brands like Visa and Mastercard to get information about the creation of a payments service that could affect their business immensely while simultaneously having the option to easily dip out should something go wrong.

And there are quite a few things that could go awry given factors like regulatory gray zones, open questions on privacy, and public perception. According to the NYT, Facebook approached a number of big financial companies, including Goldman Sachs, JPMorgan Chase and Fidelity, about participating in the project, but they declined, in part because of regulatory questions about cryptocurrencies as a whole.

I’m watching with great interest to see how Facebook will get this off the ground all while attempting to circumvent criticism from the people whose approval and support it needs most. Read more.

SNEAKER MANIA: Trading sneakers is a big business. StockX, a Detroit-based online marketplace that specializes in re-selling limited-edition sneakers, raised $110 million in funding at a valuation of more than $1 billion. Investors include DST Global, General Atlantic, GGV Capital, GV and Battery Ventures. Sneaker exchange marketplaces are on the rise, and retailers are taking note. In February, Foot Locker invested $100 million in GOAT Group, which operates a secondary sneaker market. The New York Times’ Erin Griffith writes: “The fervor for sneakers has been fueled by ‘sneakerheads’ and others who regard the shoes as investment assets.”

BIG PHARMA DEAL: AbbVie agreed to buy Allergan in a deal valued at about $63 billion, a 45% premium on Allergan’s most recent closing stock price. The proposed M&A will be one of the largest health care mergers of the year and bring together a portfolio that includes AbbVie’s Humira, the world’s best-selling drug, and Allergan’s flagship beauty treatment Botox.

My colleague Sy Mukherjee explains further:

But the AbbVie Allergan deal isn’t just a story about health care consolidation – it’s one about the state of innovation among big, legacy biopharma companies scurrying to find ways to plug future holes in their revenue streams. Both companies have bled market value in the past year as investors questioned whether AbbVie can make up for falling sales of its blockbuster psoriasis and arthritis treatment Humira, which rang in nearly $20 billion in 2018 revenues alone, and pushed for a breakup of Allergan amid pipeline struggles.

Read more here.

HOUSEKEEPING: I’m finally going on vacation! (But I’ll probably still be tweeting about deals, so you can find me on Twitter here.) In my absence, my colleague Lucinda Shen will be in charge of compiling the deals and keeping you up to date every morning. Please send deals and scoops her way at [email protected].

VENTURE DEALS

• Carbon, a Redwood City, Calif.-based 3D printing platform, raised $260 million in funding at a $2.4 billion valuation. Madrone Capital Partners and Baillie Gifford co-led the round, and were joined by investors including Sequoia Capital, Adidas Ventures, Johnson & Johnson Innovation, Fidelity Management & Research Company, JSR Corporation, Temasek, and Arkema.

• Budderfly, a Shelton, Conn.-based company developer of energy intelligence software, raised $55 million in funding. Balance Point Capital led the round, and was joined by investors including Connecticut Innovations.

• Cameo, a Chicago-based marketplace where fans can book personalized video shoutouts from pop culture personalities, raised $50 million in Series B funding. Kleiner Perkins led the round, and was joined by investors including The Chernin Group, Spark Ventures, Bain Capital and Lightspeed Venture Partners.

• Software Motor Company, a Sunnyvale, Calif.-based manufacturer of an Internet-enabled electric motor system, raised $31.4 million in Series A-2 funding. Investors include JLL Spark and Meson Capital.

• Imgur, a San Francisco-based community-powered entertainment platform, raised $20 million in funding from Coil.

• Metropolis Technologies, Inc., a Los Angeles-based mobility startup focused on building integrated networks to enable the future of mobility, raised $17.5 million in seed funding. Zigg Capital led the round, and was joined by investors including Slow Ventures and RXR Realty.

• Omnidian, a Seattle-based provider of residential and C&I solar system protection plans and performance guarantees, raised $15 million in funding. IA Capital led the round, and was joined by investors including Evergy, National Grid (National Grid Partners), Avista Corp, Blue Bear Capital, Congruent Ventures and City Light Capital.

• Anomalie, a San Francisco-based custom wedding gown company, raised $13.6 million in Series A funding. Goodwater Capital led the round, and was joined by investors including Signia, SoGal Ventures, Lerer Hippeau’s BN Capital Fund, and Fin’s Sam Lessin.

• GreatHorn, a Waltham, Mass.-based provider of an email security platform, raised $13 million in funding. RRE Ventures and .406 Ventures co-led the round , and were joined by investors including Techstars Ventures, V1.VC and Uncork Capital.

• Spiffy, a Research Triangle Park, N.C.-based on-demand car care, technology, and services company, raised $10 million in funding. Tribeca Venture Partners led the round.

• Remedy, an Austin, Texas-based provider of healthcare services, raised $10 million in Series A funding. Santé Ventures led the round.

• Squire, a New York-based business management platform for barbershops, raised $8 million in Series A funding. Trinity Ventures led the round.

• Phlur, an Austin-based fragrance company, raised $7 million in Series A funding. Symrise Inc led the round, and was joined by investors including Next Coast Ventures and Belcorp.

• Car IQ, a San Francisco-based developer of vehicle payment technology, raised $5 million in Series A funding. Quest Venture Partners led the round, and was joined by investors including Avanta Ventures, Citi Ventures, Alpana Ventures, Plug and Play, and AVG’s Spike Ventures.

• Homeroom, a San Francisco-based platform for after-school enrichment programs, raised $3.5 million in seed funding. Forerunner Ventures led the round, and was joined by investors including Felicis, Precursor, and Kapor Capital.

HEALTH AND LIFE SCIENCES DEALS

• InterVene Inc, a Mountain View, Calif.-based developer of a catheter-based therapy system, raised $15 million in Series B funding. 3×5 Partners led the round, and was joined by investors including RiverVest Venture Partners, Boston Scientific Corporation (NYSE: BSX), and Correlation Ventures.

PRIVATE EQUITY DEALS

• Cortec Group acquired Aspen Medical Products, an Irvine, Calif.-based designer and manufacturer of upper and lower spinal orthopedic bracing products. Financial terms weren't disclosed.

• Pestell Group, a portfolio company of Wind Point Partners acquired VersaPet Inc, a Canada-based manufacturer of private label and branded cat litter products. Financial terms weren't disclosed.

OTHER DEALS

• Extreme Networks (Nasdaq: EXTR) agreed to acquire Aerohive Networks (NYSE: HIVE) for approximately $272 million.

IPOs

• Zekelman Industries, a Chicago, Ill.-based steel pipe and tube manufacturer, withdrew plans for a $752 million IPO. It posted sales of $2.6 billion and net income of $246.1 million in the 12 months ending June 2018. Goldman Sachs and BofA Merrill Lynch were underwriters. It had planned to list on both the NYSE and the Toronto Stock Exchange as “ZEK.” Read more.

• Cambium Networks, a Rolling Meadows, Ill.-based firm for cloud-based wireless broadband network infrastructure, raised $70 million in an IPO of 5.8 million shares priced at $12, below its range. J.P. Morgan and Goldman Sachs are underwriters. It plans to list on the Nasdaq as “CMBM.” Read more.

EXITS

FIRMS + FUNDS

• Arlington Capital Partners, a Washington, D.C.-based private equity investment firm, raised $1.7 billion for its fifth fund, Arlington Capital Partners V, L.P.

• Clearlake Capital Group, L.P, a Santa Monica, Calif.-based private investment firm, raised $1.4 billion for its fund, Clearlake Opportunities Partners II.

• Torch Capital, a New York-based venture capital firm, raised $60 million for its inaugural fund.