Happy Friday, readers.
It’s been the year of the cloud stocks (exhibit A and B: Twilio and Snowflake).
But it has not been a smooth upward trajectory for Fastly (NYSE: FSLY), a San Francisco-based company that helps deliver digital content. At one point in the pandemic, the company that counts Pinterest and GitHub among its customers was the best-performing tech stock during the crisis and achieved a valuation of about $15.5 billion.
But in recent days, the company has lost over a third of its value in a very 2020, Mad Libs-esque scenario. Fastly warned on Wednesday that earnings for the quarter would be lower than expected due to less usage from Fastly’s largest customer. That customer: TikTok, the short-form video platform backed by ByteDance.
“Due to the impacts of the uncertain geopolitical environment, usage of Fastly’s platform by its previously disclosed largest customer did not meet expectations, resulting in a corresponding significant reduction in revenue from this customer,” Fastly’s press release read.
TikTok’s side of the story is known by now: President Donald Trump’s administration threatened to ban the Chinese-owned app if it did not offload its U.S. Operations to an American entity. Then Oracle and Walmart stepped in to take up stakes in those operations with Trump’s blessing. But TikTok is still seeking to finalize a deal that satisfies U.S. And Chinese regulators, and the company is also fighting restrictions that would effectively shut down the app on Nov. 12 in the U.S.
Fastly’s largest customer was not the only one to reduce usage in the quarter—“a few customers,” the press release noted without naming them, also had lower-than-estimated usage. That said, shares of the company remain elevated compared to pre-pandemic levels—up 514% since mid-March.
THE BEST WAY TO PITCH? Here’s an interesting study that came up on the wires this week from Yale researchers. Based on some 1,130 pitch videos submitted over the past decade to early-stage accelerators (Y Combinator, MassChallenge, 500 Startups, Techstars, and AngelPad), the researchers found that entrepreneurs who appeared friendly and happy were more likely to raise funding, while those that only spoke of their ability and competitiveness weren’t. But for the startups that raised funding, the accelerators’ decisions didn’t necessarily mean success in the long term (based on the company’s total employment, if it raised follow-up rounds, and, of course, if it’s still alive).
Lucinda Shen
Twitter: @shenlucinda
Email: [email protected]
VENTURE DEALS
- Proterra, a Burlingame, Calif.-based maker of electric busses, raised $200 million in funding. Cowen Sustainable Investment Advisors led the round and was joined by investors including Soros Fund Management, Generation Investment Management and Broadscale Group.
- VectivBio AG, a Basel, Switzerland-based clinical-stage biotech focused on rare diseases, raised $110 million in funding. Investors included Surveyor Capital,, Cormorant Capital and Eventide Asset Management, as well as Versant Ventures, OrbiMed, Novo Holdings, BPI France, Tekla Healthcare Investors, Inserm Transfer Initiative and Cowen Healthcare Investments.
- DISCO, an Austin-based legal tech startup, raised $60 million in funding valuing it at $785 million. Georgian Partners led the round and was joined by investors including Bessemer Venture Partners, LiveOak Venture Partners, The Stephens Group, and Breyer Capital.
- M1 Finance, a Chicago, Ill.-based finance app for automated investing and borrowing, raised $45 million in Series C funding. Left Lane Capital led the round.
- Fivestars, a San Francisco-based maker of small business payments and marketing software, raised $52.5 million in funding. Salt Partners led the round and was joined by investors including Lightspeed Venture Partners, DCM Ventures, Menlo Ventures and HarbourVest Partners. Read more.
- Vineti, a San Francisco, Calif.-based gene therapy platform, raised $33 million in extended Series C funding. Cardinal Health led the round and was joined by investors including Marc Benioff, Canaan Partners, Threshold Ventures, Section 32, Casdin Capital, Novartis Pharma AG, McKesson Ventures, and LifeForce Capital,
- Whisper, a San Francisco-based maker of hearing aids, raised $35 million in Series B funding. Quiet Ventures led the round and was joined by investors including Sequoia Capital and First Round Capital.
- Sonrai Security, a New York-based cloud security platform, raised $20 million in Series B funding. Menlo Ventures led the round and was joined by investors including Polaris Partners and Ten Eleven Ventures.
- Temporal, a Seattle-based maker of an open source, stateful, microservices orchestration platform, raised $18.8 million in Series A funding. Sequoia Capital led the round and was joined by investors including Madrona Venture Group, Addition Ventures and Amplify Partners.
- Savana, a Madrid-based startup applying big data to electronic health records, raised $15 million in Series B funding. Cathay Innovation led the round and was joined by investors including Seaya Ventures and MACSF.
- Chiper, a San Francisco-based e-commerce platform for independent merchants, raised $12 million in Series A funding. Investors included WIND Ventures, Monashees, and Kaszek Ventures.
- Alpaca, a San Mateo, Calif.-based startup for companies to add commission-free equities trading to their platforms, raised $10 million in Series A funding. Portag3 led the round and was joined by investors including Social Leverage, Spark Capital, Fathom Capital, and Abstract Ventures. Read more.
- Sanity.io, an Oslo, Norway- and San Francisco, Calif.-based content platform for developers, raised $9.3 million in Series A funding. Threshold Ventures led the round and was joined by investors including Ev Williams, Adam Gross, Guillermo Rauch, Stephanie Friedman, Monochrome Capital, Heavybit, Alliance Venture, Matthias Biilman, Chris Bach, Jon Da l and Edvard Engsæth.
- Acceldata, a Palo Alto, Calif.-based maker of a data observability platform, raised $8.5 million in Series A funding. Sorenson Ventures led the round and was joined by investors including Lightspeed and Emergent Ventures.
- Urban Umbrella, a New York City-based scaffolding design company, raised $7 million in Series B funding. The investors were not named.
- Nabis, an Oakland, Calif.-based cannabis distributor, raised $5 million in Series A funding. Y Combinator led the round. Read more.
- Smartvid.io, a Cambridge, Mass.-based construction site monitoring platform, raised $5 million in funding. IA Capital Group led the round and were joined by investors including Building Ventures, Companyon Ventures, and Converge.
- WiserCare, a Los Angeles-based digital health platform, raised $3.6 million in funding. UnityPoint Health Ventures led the round and was joined by investors including Abundant Venture Partners.
- Elenas, a Bogota, Colombia-based social commerce platform, raised $2 million in seed funding. Investors included Alpha4 Ventures, Amador Holdings, Polymath Ventures, and Meesho.
- Glipmse, a Washington D.C.-based business-to-business marketplace that allows brands to reach new customers by placing products in short-term real estate rentals, raised $1.5 million in seed funding. Origin Ventures led the round and was joined by investors including GSR Ventures.
PRIVATE EQUITY
- Summa Equity acquired a majority stake in Sengenics, a Singapore-based functional proteomics company. Financial terms weren't disclosed.
Wind Point invested in Handgards, an El Paso, Texas-based food safety company. Financial terms weren't disclosed.
- EMPI, a portfolio company of Dubin Clark, acquired RacingLine Group, a U.K.-based provider of branded parts and software for Volkswagen and Audi vehicles. Financial terms weren't disclosed.
- Welsh, Carson, Anderson & Stowe invested in GovernmentCIO, a Washington D.C.-based provider of technology and digital solutions to the federal health IT services market. Financial terms weren't disclosed.
- CriticalPoint Capital acquired the power construction business of AECOM (NYSE:ACM). Financial terms weren't disclosed.
- Telestream, backed by Genstar Capital, acquired EcoDigital, a Vancouver, Wa.-based maker of a content management system. Financial terms weren't disclosed.
EXITS
- Fluence acquired Advanced Microgrid Solutions, a San Francisco-based maker of software aimed at optimizing clean energy assets. AMS has raised from investors including Arnold Schwarzenneger, DBL Partners and Energy Impact Partners.
- Salto Systems acquired Gantner Technologies, an Austrian-based maker of electronic access systems, from Ardian. Financial terms weren't disclosed.
OTHERS
- Yandex terminated talks to acquire TCS Group Holding, Russia’s biggest lender, after previously saying it reach a preliminary agreement to buy the company for $5.5 billion in cash and stock. Read more.
- ZoomInfo ( Nasdaq: ZI ) acquired Clickagy, a Roswell, Ga.-based buyer intent data provider. Financial terms weren't disclosed.
IPOs
- Eargo, a San Jose, Calif.-based hearing-aid maker, raised $141 million in an offering of 7.9 million shares priced at $18. The firm posted revenue of $32.7 million and loss of $44.5 million in 2019. New Enterprise Associates, Future Fund, Gilde Healthcare, and Longitude Venture back the firm. Read more.
- Aligos Therapeutics, a South San Francisco-based clinical-stage maker of therapies for viral and liver diseases, raised $150 million in an offering of 10 million shares priced between $14 to $16. Backers include Roche, Versant Ventures, and Baker Bros. Advisers. Read more.
- Tarsus Pharmaceuticals, a clinical-stage biotech developing therapies for ophthalmic conditions, raised $88 million in an offering 5.5 million shares priced at $15 apiece. Vivo Capital and Frazier Life Sciences backs the firm. Read more.
SPAC
- Bridgetown Holdings, a blank check company formed to acquire a company in Southeast Asia formed by Pacific Century and Thiel Capital, raised $550 million.
- H.I.G. Acquisition, a blank check company formed by H.I.G. Capital,now says it plans to raise $325 million rather than $450 million.
F+FS
- L Squared Capital raised $505 million for its third fund. Read more.
PEOPLE
- RedBird Capital Partners plans to open a West Coast office in Los Angeles, led by Andy Gordon who will join the firm as a Partner in February 2021.
- Global Infrastructure Partners has named Jim Amine as a partner.
