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There’s no end in sight to investors’ excitement for fintech deals.
Case and point: San Francisco-based “neobank” Chime on Friday revealed it raised $750 million in funding valuing it at $25 billion—making it the country’s second most valuable fintech startup after Stripe. The startup had a well-known roster of investors on the table too: Sequoia Capital Global Equities led the round and was joined by investors including SoftBank’s Vision Fund 2, General Atlantic, Tiger Global Management, and Dragoneer Investment Group.
While investors may be betting a bounceback to pre-pandemic habits in some industries, digital banking appears to be one many investors believe will stick around for the long-run. U.K.-based Revolut for instance recently reached a $33 billion valuation with investors including SoftBank and Tiger Global Management, while U.S.-based Current hit a $2.2 billion valuation in April in a round led by Andreessen Horowitz.
And Chime certainly has gotten a pandemic boost: Known for building a roster of low- to middle- income consumers, the bank got heavy mileage as users sought fast access to unemployment benefits and more forgiving bank terms (Chime allows users to overdraw up to $200).
Per the Wall Street Journal, the company is now potentially gearing up for an IPO in the first half of 2022—perhaps of little surprise given the spate of tech companies that have taken the leap of faith in recent months including crypto exchange Coinbase and stock-trading app maker, Robinhood.
Chime’s growth and funding round also brought another burning question to the fore: Will it soon have another competitor in the form of Walmart?
The retailer in January reported plans to build its own fintech in partnership with Ribbit Capital, a venture capital firm focused on the space, sending shockwaves through the industry before any actual plans had even been revealed.
Even now, details on Walmart’s end are scant. But the similarities between the profile of its consumers—those in the low- to middle-income range—and those of Chime’s, combined with a recent trademark application, certainly could put the two in the same arena.
Lucinda Shen
Twitter: @shenlucinda
Email: [email protected]
Jessica Mathews compiled the IPO and SPAC sections of this newsletter. Anne Sraders contributed to the deals.
VENTURE DEALS
- Eruditus, an Indian education tech startup, is nearing a deal to raise $450 million, per Bloomberg. Investors include SoftBank and Accel Partners, valuing it at about $3.2 billion.
- XtalPi, a Chinese drug discovery startup, raised $400 million valuing it at about $2 billion. OrbiMed and Hopu Investments co-led round.
- Ualá, an Argentinian fintech, raised $350 million in Series D funding valuing it at over $2.5 billion. SoftBank Latin America Fund and Tencent co-led the round and were joined by investors including Soros Fund Management, Goldman Sachs Asset Management, Ribbit Capital, Greyhound Capital, Monashees, Endeavor Catalyst, D1 Capital Partners, and 166 2nd.
- Divvy Homes, a San Francisco-based proptech startup that helps renters build wealth while they save to buy a home, raised $200 million in Series D funding. Tiger Global Management and Caffeinated Capital led the round and were joined by investors including Andreessen Horowitz, GGV Capital, GIC, and Moore Specialty Credit.
- Kiddom, a San Francisco-based digital curriculum company, raised $35 million in Series C funding. Altos Ventures led the round and was joined by investors including Owl Ventures, Khosla Ventures, and Outcomes Collective.
- Product School, a San Francisco-based product management training company, raised $25 million from Leeds Illuminate.
- Retrain.ai, a New York City-based training and upskilling platform, raised $7 million from current investors and Splunk Ventures.
- ThirdAI, a Houston-based deep learning company, raised $6 million in seed funding. Neotribe Ventures, Cervin Ventures, and Firebolt Ventures led the round.
- Orchata, a Mexico-based grocery delivery app, raised $4 million in seed funding from investors including Y Combinator, JAM Fund, FJ Labs, Venture Friends, Investo, Foundation Capital, and angel investors.
- Buildable, a Canadian maker of software for developers, raised $3 million in seed funding. Ripple Ventures led the round and was joined by investors including Golden Ventures, Richard & Michael Hyatt, and Village Global.
PRIVATE EQUITY
- Advent International, FSI, and CVC Capital Partners are reportedly restarting preliminary talks to buy a €1.7 billion ($2 billion) stake in the media business of Serie A, the premier Italian soccer league, Bloomberg reported citing sources.
- Affinity Equity Partners, Permira, and GS Retail acquired Yogiyo, a South Korea-based food delivery app owned by Delivery Hero. The deal is valued at 800 billion won ($685 million).
- Caron Products and Services, backed by SFW Capital, acquired Bigneat, a U.K.-based provider of safety solutions and laboratory products. Financial terms weren't disclosed.
- Hudson Hill Capital invested in VTrips, a Jacksonville, Fla.-based vacation rental manager. Financial terms weren't disclosed.
- Spectra A&D Holdings, backed by Vance Street Capital, acquired Galleon Embedded Computing AS, a defense tech company. Financial terms weren't disclosed.
EXIT
- SGT Capital agreed to acquire Utimaco, a Germany and Campbell, Calif.-based cybersecurity firm, from EQT. The deal is valued at roughly $500 million, per Bloomberg.
- Hyatt Hotels will acquire Apple Leisure Group, an operator of resorts across Mexico, the Caribbean, and Europe, from KKR and KSL Capital Partners for $2.7 billion in cash.
- CDW Corporation (Nasdaq: CDW) acquired Focal Point Data Risk, a New York City-based cybersecurity consultancy, from Norwest Equity Partners.
- Partners Group will acquire Atria Convergence Technologies, an Indian broadband company, from Argan and TA Associates, valuing it at about $1.2 billion.
OTHER
- Faurecia agreed to acquire a 60% stake in Hella, a German automotive supplier, valuing it at €6.8 billion ($8 billion).
- Polygon acquired Hermez Network, an Ethereum scaling project, for $250 million.
IPO
- QSR Brands (M) Holdings, a company operating Southeast Asian locations of KFC and Pizza Hut, is gearing up for an IPO, per Bloomberg. The company is aiming for a $1.4 billion valuation.
- PharmaCann, a Chicago-based cannabis company, confidentially filed for an IPO, according to Reuters. A deal could value the company at more than $1 billion.
- The Administrative Capital for Urban Development in Egypt, a state-owned company building Egypt’s new administrative capital outside of Cairo, is making plans for an IPO, per Bloomberg.
F+FS
- Lowercarbon Capital, Chris and Crystal Sacca’s climate-focused fund, raised $800 million.
- Weatherford Capital, a Florida-based private investment firm, closed Weatherford Capital Fund I with $355 million.
- Harpoon Ventures, a venture fund focused on helping early-stage companies secure contracts from the U.S. Government, closed its third fund with $120 million.
PEOPLE
- Palladium Equity Partners, a New York City-based private equity firm, named Carlos Reyes as a managing director.
