Would you take lower returns for cleantech?

Cleantech is staging a comeback with investors seemingly the most bullish they’ve been on the sector since perhaps the bust from roughly a decade ago.

But a major problem from the cleantech boom of the late 2000s still persists today: The cost of many clean options remains expensive. The price of running an airplane on jet fuel costs about $2.22 per gallon, for instance, while clean biofuel costs a significantly higher $5.35 per gallon, notes Bill Gates in his guest essay for Coins2Day published Tuesday.

To solve the problem, Gates is proposing an ambitious change not only in the mindset of governments and technologists, but also in investors and financiers. While investors have long been praised for eking out the highest returns possible, Gates is calling for acceptance of lower monetary returns to benefit the climate. He wrote in his article: “For example, lenders will need to be willing to finance innovative ideas—with low-cost capital and other financial concessions—that could make clean solutions cheaper.”

It won’t be an easy shift— environmental, social, and governance-focused investing strategies still pale in size to the wider market, though interest is growing fast. And the verdict is still out as to whether public market funds with ESG-focuses actually do that well.

Still, Gates has a pretty compelling argument to investors and financiers: Either invest in companies that will help lower carbon emissions or face the danger of having no planet to invest in at all.

It won’t be a short journey if the time horizon on Breakthrough Energy Ventures, the Gates-led firm making bets in cleantech, is anything to go by. BEV recently raised another $1 billion and plans to make investments through at least 20 years rather than the average 10-year cycle. BEV is backed by billionaires including Michael Bloomberg, SoftBank’s Masayoshi Son, and LinkedIn co-founder Reid Hoffman.

TECH GIANTS FIGHT NVIDIA’S $40 BILLION DEAL FOR ARM: In what could be a blow to SoftBank, the U.S. Federal Trade Commission has launched an in-depth probe into Nvidia’s proposed $40 billion deal to buy semiconductor company Arm. The news comes after large companies including Alphabet’s Google, Microsoft, and Qualcomm reportedly voiced concerns over Nvidia potentially limiting access to key chip technologies post-merger. While Arm, which SoftBank acquired for $31 billion in 2016, and Nvidia, a maker of graphic processing units, do not compete directly, the increased scrutiny on the deal is also a sign of a more critical eye on so-called vertical mergers in the new administration.

Lucinda Shen
Twitter: @shenlucinda
Email: [email protected]

VENTURE DEALS

- BlockFi, a San Francisco-based crypto financial services company,  is reportedly looking to raise $150 million, valuing it around $2.9 billion pre-money, per the Block. Read more.

- Notch Therapeutics, a Canadian biotechnology company developing cell therapies for cancer, raised $85 million in Series A funding. The lead investor was not disclosed. Other investors included Allogene Therapeutics, Lumira Ventures, and CCRM Enterprises Holdings.

- Sagimet Biosciences, a San Mateo, Calif.-based biotechnology company developing treatments for diseases including for cancer, raised $80 million. The lead investor was not disclosed. Other investors included Ascletis, Kleiner Perkins, New Enterprise Associates, and Rock Springs Capital.

- HemoShear Therapeutics, a Charlottesville, Va.-based firm developing treatments for rare metabolic disorders, raised $40 million in Series A funding. Suvretta Capital led the round and was joined by investors including Janus Henderson Investors and Adage Capital Management.

- Redefine Meat, an Israeli 3D printed meat substitute startup, raised $29 million in Series A funding. Happiness Capital and Hanaco Ventures led the round and was joined by investors including CPT Capital, Losa Group, Sake Bosch, and K3 Ventures. 

- Q’Apel Medical, a Fremont, Calif.-based company making devices for neurovascular disorders, raised $22 million in Series C funding. Investors included River Cities Capital, Soleus Capital, and Research Corporation Technologies.

- SUPER73, an Irvine, Calif.-based electric bike company, raised $20 million. Volition Capital invested.

- Solidatus, a London-based data management company, raised £14 m ($19.2 million) in Series A funding. AlbionVC led the round and was joined by investors including HSBC Ventures and Citi.

- Interplay Learning, an Austin-based training platform for trade workers, raised $18 million in Series B funding. Owl Ventures and S3 Ventures led the round and were joined by Strada Education Network and The Venture Reality Fund, SJF Ventures, Sierra Ventures, Holt Ventures, Wild Basin Investments, and Shelter Capital Partners. 

- AdmitHub, a Boston-based maker of a chatbots  for student engagement at universities, raised $14 million in Series B funding. Rethink Education led the round and was joined by investors including ECMC Group’s Education Impact Fund and Kresge Foundation’s impact investment fund.

- Synthetix, an Australia-based maker of a crypto trading platform, raised $12 million in funding. Investors included Coinbase Ventures, Paradigm, and IOSG.

- Cohort, a San Francisco-based virtual care scaling company, raised $11 million in Series B funding. F-Prime Capital led the round and was joined by investors including Town Hall Ventures.

- Pawlicy Advisor, a New York-based pet insurance marketplace, raised $6.5 million in Series A funding. Rho Capital Partners led the round and was joined by investors including Defy Partners and Slow Ventures.

- EnginZyme, a Stockholm-based maker of tech in the sustainable production of chemicals, raised €4.4 million ($5.3 million) in extended Series A funding. Industrifonden led the round.

- PayZen, a San Francisco, Calif.-based healthcare payments tech company, raised $5 million in seed funding. Viola Ventures incubated the business, with additional funding from Picus Capital and TWO39 Ventures.

- tru.ID, a London-based mobile authentication company, raised £3 million ($3.6 million) in funding. Investors included Episode 1, MMC Ventures, and NHN Ventures. 

- Marble, a New York-based digital wallet and loyalty platform for insurance, raised $2.5 million in seed funding. Investors include IA Capital Group, MS&AD Ventures, Reciprocal Ventures, Fintech Ventures Fund, The Takoma Group, and HU Investments.

- Pattern Health, a Durham, N.C.-based digital health company, raised $1.5 million. Cofounders Capital and The Launch Place were the investors.

PRIVATE EQUITY

- Cerberus Capital Management terminated a $357 million deal to take Dorel Industries, a Canadian toy and bicycle maker, private after shareholder resistance. Read more.

- Corcentric, backed by Bregal Sagemount, acquired Vendorin, an Hattiesburg, Miss.-based payments services company, from Juvo Technologies for about $100 million.

- Warburg Pincus invested $75 million in Personetics, a New York and Tel Aviv-based digital banking analyzation company. 

- H.I.G. Capital acquired FVO – Brasília Indústria e Comércio de Alimentos LTDA, a Brazilian pet food manufacturer. Financial terms weren't disclosed.

- JLL Partners launched Breakwater Solutions, an Austin-based provider of consulting around information governance and cybersecurity. Fingerm.

- Northstar Capital invested in Alpaca Audiology, a Russellville, Ark.-based provider of hearing healthcare. Financial terms weren't disclosed.

- Charter Health Care Group, backed by Pharos Capital Group, acquired Physmed Home Health Care and Serene Care Hospice, Omaha, Ne.-based hospice care centers. Financial terms weren't disclosed.

- Quorum Software, a Thoma Bravo portfolio company, merged with Aucerna, a provider of integrated planning, execution and reserves software for the energy industry also backed by Thoma Bravo. The combined company also agreed to acquire TietoEVRY's oil and gas software business. Financial terms weren't disclosed.

- Riata Capital Group invested in Greenix Pest Control, a Columbus, Oh.-based subscription-based, residential pest control service. Financial terms weren't disclosed.

- Sympa, backed by PSG, merged with Recruitee, an Amsterdam-based leading provider of HR software. Financial terms weren't disclosed.

- TA Associates took a majority investment in IGEL, a San Francisco-based provider of security for cloud workspaces. Financial terms weren't disclosed.

EXITS

- BC Partners and Apax are expected to be in the final running for a majority stake in Logoplaste, a Portuguese plastic packaging maker, from Carlyle, per Reuters. A deal could value the stake at €1.4 billion euros ($1.7 billion). Read more.

- Lanxess agreed to acquire Emerald Kalama Chemical, a U.S.-based maker of chemicals used in food preservatives and fragrances, for about $1.1 billion. American Securities backs Emerald.

- Zillow Group, Inc. (Nasdaq: Z), agreed to acquire ShowingTime.com, a Chicago-based maker of an online scheduling platform for home showings, for $500 million. Its backers have included LaSalle Investment Management and Vencore Capital.

- Sensata Technologies (NYSE: ST) agreed to acquire Xirgo Technologies Intermediate, a Camarillo, Calif.-based telematics and data provider, for $400 million. HKW backs Xirgo.

- Byju’s is in talks to acquire Toppr Technologies, a rival Indian edtech, valuing the latter at roughly $150 million, per Bloomberg. Toppr is backed by investors including SAIF Partners and Helion Ventures. Read more.

- Datadog (NYSE: DDOG) acquired Sqreen, a San Francisco-based cybersecurity company. Sqreen’s investors have included Greylock Partners and Blossom Capital. Financial terms weren't disclosed.

- Datadog (NYSE: DDOG) acquired Timber Technologies, a Brooklyn, N.Y.-based data observability platform. Investors of Timber Technologies included NextView Ventures. Financial terms weren't disclosed.

OTHERS

- Cable One (NYSE: CABO) agreed to acquire the remaining stake it does not own of Hargray Communications, a regional telecom company with services in South Carolina, Georgia, Alabama, and Florida. The deal is valued at about $2.2 billion.

- ByteDance is weighing a sale of its Indian TikTok operations to rival Glance, per Bloomberg. SoftBank, which backs ByteDance and Glance parent company InMobi, reportedly initiated the talks. Read more.

- The U.S. Federal Trade Commission has initiated a probe into Nvidia’s agreement to acquire Arm, the U.K.-based chipmaker, per Bloomberg. Read more.

- Fiverr Internationa l (NYSE: FVRR) acquired Working Not Working, a Brooklyn, N.Y.-based maker of a platform for hiring creatives. Financial terms weren't disclosed.

IPOs

- Deliveroo, the U.K.-based food delivery company, is expected to unveil plans for an IPO in London on March 8, per Sky News, citing sources. Read more.

- Cia. Siderurgica Nacional SA’s mining unit, the mining unit of the Brazilian steelmaker, raised 4.5 billion reais ($838 million), per Bloomberg. Read more.

SPAC

- Sharecare, an Atlanta-based digital health company, plans to go public via merger with Falcon Capital Acquisition, a SPAC, valuing it at $3.9 billion.

- Li-Cycle Corp, a Canadian recycler of lithium-ion batteries, plans to go public via merger with Peridot Acquisition, a SPAC, valuing the company at $1.7 billion, per Reuters. Read more.

- Owlet Baby Care, a Lehi, Ut.-based maker of nursery monitoring equipment and clothing, agreed to go public via merger with Sandbridge Acquisition, a SPAC formed by Sandbridge Capital. The SPAC values the company around $1.1 billion.

- Khosla Ventures Acquisition, II, and III, a trio of SPACs from Khosla Ventures, filed to raise $300 million, $400 million, and $500 million respectively.

- Reinvent Technology Partners Y, another SPAC from Reid Hoffman and Mark Pincus targeting tech, filed to raise $850 million.

- Independence Holdings, a blank check company created by the founders of FT Partners and Sagemount seeking tech and fintech targets, filed to raise $400 million.

- Virgin Group Acquisition II, a SPAC formed by the Virgin Group, filed to raise $330 million.

- Oaktree Acquisition III, the third SPAC from executives at Oaktree Capital, filed to raise $325 million.

- Orion Acquisition, a SPAC seeking a target in the healthcare industry, filed to raise $300 million. 

F+FS

- Hamilton Lane closed Hamilton Lane Secondary Fund V, a private equity secondary vehicle, with $3.9 billion of capital commitments.

- Wind Point Partners, a Chicago-based private equity firm, closed its ninth fund with approximately $1.5 billion.

- Nationwide, the Columbus, Oh.-based insurer, expanded its venture capital investment fund to $350 million. It was created as a $100 million fund in 2017.

- 01 Advisors, the fund by Dick Costolo and Adam Bain, closed their second fund with $325 million. Read more.

- Ironspring Ventures, a Texas-based venture firm, raised $60 million to focus on industrial technologies.

PEOPLE

- Susquehanna Growth Equity, a Bala Cynwyd, Pa.-based firm, promoted Martin Angert to managing director; Josh Elser to managing director; and Joe Mihm to vice president.

- Questa Capital, a Washington D.C.-based firm, hired Dr. Aabed Meer as a partner.