Behind the scenes takes from Day 1 of the biggest trial in business

Nearby, New Yorkers were scuttling around downtown as former President Donald Trump would make an appearance for the second day of his civil business fraud trial at a courthouse nearby. Needless to say, there are some pretty high-profile court cases underway this week in New York.

For purposes of this newsletter, we’re most interested in the SBF trial, which is a historic one for the venture capital industry, as it has to do with the greatest VC-backed startup collapse in history. FTX, once worth $40 billion across its U.S. And international operations, is now bankrupt, and SBF will have to defend himself over its collapse in the coming weeks.

Which is how reporters like our very own Ben Weiss ended up on Pearl Street yesterday, furiously scribbling away on reporting notepads as jury selection was underway.

I called up Weiss after he left the courthouse yesterday to get a sense of what happened. Perhaps what surprised me most about our conversation was that the notorious crypto founder finally got a haircut. That’s right: After all this time, the unkempt SBF went to the barber, right in time to be tried for seven counts of fraud and money laundering (He has pled not guilty on all counts). I wish we had a photo for you, but, alas, cameras aren’t allowed in the courtroom. So we’ll have to take Weiss’ word for it.

“He still looked disheveled,” Weiss told me, noting he only saw SBF from a screen in an overflow room outside the courtroom. 

As for the actual proceedings, we won’t know what to expect from the government and defense until the opening arguments are given later today. But what we did learn is that there was never a plea deal: Today’s proceedings offered the first public confirmation that prosecutors never delivered a formal plea deal to SBF, though it’s unclear whether Bankman-Fried’s team rejected one, or whether prosecutors came to that decision on their own. As we already knew, the government had made plea deals with four of SBF’s former colleagues, including his ex-girlfriend Caroline Ellison, all of whom may testify over the course of the next six weeks.

For the jury selection, Judge Lewis A. Kaplan asked potential jurors whether they thought they could be fair and impartial, and whether a six-week trial would be too onerous for them.

Of approximately 50 potential jurors that were considered, one said she worked at Insight Partners, which is one of several venture capital firms that had backed FTX, as Weiss reported in the story he published yesterday. The woman said she hadn’t worked on the FTX investment and could be impartial.

All in all, Weiss said the day was mostly laying the groundwork for today, where we’ll get a real sense of the government’s case, and what we can expect over the next six weeks.

“It was kind of like the preface to what should be the big, bombastic opening tomorrow,” Weiss said.

A deal scoop from Luisa…American Express is seeking a buyer for Accertify, more than a dozen years after buying the fintech, according to three banking and venture capital executives. AmEx acquired Accertify, which provides fraud prevention software, in 2010 for $150 million. It is seeking $800 million to $1 billion for Accertify, the people said. Barclays is advising on the process, they said. AmEx and Barclays declined comment.—Luisa Beltran

See you tomorrow,

Jessica Mathews
Twitter: @jessicakmathews
Email: [email protected]
Submit a deal for the Term Sheet newsletter here.

Joe Abrams curated the deals section of today’s newsletter.

VENTURE DEALS

- Electric Hydrogen, a San Carlos, Calif.-based company that manufactures equipment needed to produce low cost green hydrogen, raised $380 million in Series C funding. Fortescue, Fifth Wall, and Energy Impact Partners led the round and were joined by bp Ventures, Oman Investment Authority, Temasek, Microsoft’s Climate Innovation Fund, and others. 

- Stampli, a Mountain View, Calif.-based platform foraccounts payable communication, documentation, and workflow, raised $61 million in Series D funding. Blackstone led the round and was joined by Insight Partners, SignalFire, and Bloomberg Beta.

- Pulumi, a Seattle, Wash.-based platform designed for computer engineers to build online infrastructure with any programming language, raised $41 million in Series C funding. Madrona led the round and was joined by NEA, Tola Capital, and Strike Capital.

- Loop, a Chicago, Ill.-based AI-powered company that automates audits and payments for logistics companies, raised $35 million in Series B funding from J.P. Morgan Growth Equity Partners and Index Ventures. 

- Shorla Oncology, a Cambridge, Mass. And Tipperary, Ireland-based pharmaceutical company focused on developing treatments for pediatric cancers, raised $35 million in Series B funding. Kurma Partners’ Growth Opportunities Fund led the round and was joined by existing investors Seroba Life Sciences, Enterprise Ireland, and others. 

- Frec, a San Francisco-based platform designed to provide personal investors with access to tools, like direct indexing, raised $26.4 million in total seed and Series A funding. Greylock led the round and was joined by Social Leverage and others. 

- Stitch, a Cape Town, South Africa-based online payments platform for businesses, raised $25 million in a Series A extension. Ribbit Capital led the round and was joined by existing investors PayPal Ventures, The Raba Partnership, and CRE Venture Capital.

- Reserv, a New York City-based platform designed to use AI to process insurance claims, raised $20 million in Series A funding. Altai Ventures and Bain Capital Ventures led the round and were joined by 8VC, Outpost Ventures, Convex Group, AXIS Capital, Anthemis Ventures, and Arch Capital Group.

- Amperon, a Houston, Texas-based data analytics platform designed to help power grid operators decarbonize their grids, plan for power demand, and optimize energy use, raised $20 million in Series B funding. Energize Capital led the round and was joined by HSBC Asset Management and others.

- Kafene, a New York City-based platform for leasing furniture, appliances, and technology, raised $12.6 million in a Series B extension. Third Prime led the round and was joined by existing investors. 

- Opsera, a Palo Alto, Calif.-based platform designed to help software developers improve product quality, raised $12 million in a Series A extension. Taiwania Capital led the round and was joined by existing investors Felicis Ventures, Clear Ventures, and others.

- Osmoses, a Cambridge, Mass.-based company that purifies gas for low-carbon energy production, raised $11 million in seed funding. Energy Capital Ventures led the round and was joined by Engine Ventures, Fine Structure Ventures, New Climate Ventures, and others.  

- Mantle, a Toronto, Canada-based platform that uses AI for fundraising management, equity, data, and forecasting, raised $10.5 million in seed funding from Eniac, Craft Ventures, Vaynerfund, Sierra Ventures, Leaders Fund, and angel investors. 

- RQD* Clearing, a New York City-based clearing platform that helps financial traders manage transactions from the time they are agreed upon until the time they are settled, raised $10 million in Series A funding from Nyca Partners and ABN Amro.

- Lokavant, a Tokyo, Japan-based platform that provides clinical trial teams with data analysis tools, raised $8 million in a Series A extension from Mitsui & Co. 

- Kraaft, a Paris, France-based messaging app specifically for contractors and construction workers, raised €3.2 million ($3.4 million) in funding from Chalfen Ventures, Stride VC, OSS Ventures, and angel investors.

- Previsico, a London, U.K.-based flood forecasting and prevention platform for businesses, insurers, and governments, raised £2 million ($2.4 million) in funding. 24Haymarket led the round and was joined by Foresight Group.

- Induced AI, a Bangalore, India-based startup designed to allow businesses to turn plain English workflows into code, raised $2.3 million in seed funding from SignalFire, Untitled Ventures, SV Angel, Superscrypt, Balaji Srinivasan, Julian Weisser, IDEO Colab, and OnDeck.

- Centro, a Toronto, Canada-based startup designed to autonomously monitor inventory, raised $2 million in pre-seed funding. Ripple Ventures and 2048VC led the round and were joined by Valia Ventures and Comma Capital.

- Helios, a Tysons, Va.-based platform designed to predict and mitigate risk in the agricultural supply chain, raised $1.85 million in pre-seed funding. Supply Change Capital led the round and was joined by January Ventures.

PRIVATE EQUITY

- Arlington Capital Partners acquired Avenu Insights & Analytics, a Centreville, Va.-based platform designed to help state and local governments manage revenue, access records, and make payments. Financial terms were not disclosed. 

- Mod Op, backed by Alterna Equity Partners and Spell Capital Partners, acquired dPrism, a New York City-based data analytics platform. Financial terms were not disclosed. 

- Pritzker Private Capital acquired Sugar Foods Corporation, a Westlake Village, Calif.-based producer of crunchy toppings, pizza toppings, and beverage ingredients. Financial terms were not disclosed. 

- S.i. Systems, backed by Cornell Capital, acquired Elign Consulting, a Minneapolis, Minn.-based management consulting and workforce solution provider. Financial terms were not disclosed. 

- Syntax Systems, backed by Novacap, will acquire Beyond Technologies, a Montréal, Canada-based consulting and data analytics provider. Financial terms were not disclosed.

EXITS

- iA Financial Group agreed to acquire Vericity, a Chicago, Ill.-based life insurance provider, from J.C. Flowers & Co.For approximately $170 million. 

- Vista Equity Partners acquired a majority stake in TRG Screen, a New York City-based software company that analyzes how much company’s spend on market data, research, software licenses, and other corporate subscriptions, from Pamlico Capital. Financial terms were not disclosed. 

PEOPLE

- New Heritage Capital, a Boston, Mass.-based private equity firm, hired Greg Katz as vice president of business development. Formerly, he was with FreightFlows.

- Raymond James Investment Banking, a Saint Petersburg, Fla.-based investment bank, hired Glen Kruger as managing director, technology investment banking. Formerly, he was with Houlihan Lokey.