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| Here's a look at today's VC briefing. - ⚙️ Reddit, Lineage Logistics gear up for IPO listings in 2024
- 💰 VC investors offer to take Theseus Pharmaceuticals private
- 📉 Prosus lowers edtech startup Byju's valuation to below $3B
Thank you. Karan
p/karan-chafekar | |
| 1 | | Social media company Reddit and cold-storage logistics giant Lineage Logistics are gearing up for IPO listings. The former is aiming for a valuation of $15B, while Lineage is looking at a valuation of more than $30B. Both listings could happen as early as the first half of 2024. More: - Reddit has roped in Morgan Stanley and Goldman Sachs to assist with the listing.
- The San Francisco-based social media startup has raised $1.3B in total funding from investors, the last of which came through a $410M Series F round led by Fidelity Management & Research Company in Aug. 2021.
- Lineage Logistics also hired Morgan Stanley and Goldman Sachs, with the former working as a lead bank on the offering.
- The firm has raised $9.4B in total PE and VC funding to date from D1 Capital Partners, Stonepeak Infrastructure Partners, and others.
Zoom out: - In addition to Reddit and Lineage Logistics, Microsoft-backed cloud and data security firm Rubrick, Kim Kardashian's fashion label Skims, fast-fashion retailer Shein, and Chinese EV maker Zeekr have also filed for IPO listings and are planning to debut on the public markets soon.
- Organizations planning on IPO listings in 2023 have postponed their plans to the following year, considering the lukewarm reception for the four notable IPO debuts in September and October.
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| 2 | | Struggling biopharma firm Theseus Pharmaceuticals Inc. received two unsolicited buyout offers, one of which came from a group of investors led by investment firm OrbiMed Advisors and VC firm Foresite Capital. Combined, the two firms own 52.7% of Theseus and would buy the rest if their offer is approved. 
What happened: Financial terms offered by the group to take Theseus private were not disclosed. Theseus also received an unsolicited offer from Tang Capital Partners' investment vehicle, Concentra Biosciences. Concentra offered to pay $3.80 for Theseus' outstanding shares. In addition, the firm will pay contingent value right if it can dispose of Theseus' intellectual property or license it to others. Theseus is considering both offers. Relevance: Theseus, which develops enzyme blockers to stop new cancer mutations, spun out from OrbiMed. The firm emerged from stealth in April 2021 and went public the same year. Since this May, the firm's fortunes have reversed when it had to stop developing its only clinical-stage drug after it caused severe skin reactions in human trials. As a result, Theseus laid off 72% of its staff and started exploring strategic alternatives — such as a sale, merger, or shutting down — last month. The firm's share price on Monday gives it a market capitalization of $168.1M. | | | |
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| 3 | | Chinese VC firm 5Y Capital is confident about crossing the $700M fundraising milestone for its new U.S.-dollar fund. The fund has a hard cap of $800M and is expected to hold a final close early next year. The fund aims to invest in late-stage startups. More: - Notable bets made by 5Y Capital include Xiaomi, Tiktok rival Kuaishou Technology, Agora, SenseTime Group, and automaker XPeng.
- In 2021, the firm had $5B worth of total assets under management when it raised $1.7B for two U.S.-dollar-denominated funds.
- 5Y Capital, formerly known as Morningside Venture Capital, spun out from property mogul Ronnie Chan's Morningside Group.
Zoom out: - VCs have invested $44B in Chinese startups so far this year, down 65% compared to the entire year of 2018.
- U.S.-based investors reduced their fund deployment by 95%, participating in deals worth only $2.2B this year.
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| 4 | | Investment firm Prosus has lowered the valuation of the Indian edtech startup Byju's to less than $3B. In March, Prosus, which owns a 9% stake in Byju's, had already marked down the valuation to $5.1B, less than one-fourth than its peak valuation figure of $22B. More: - Byju's current valuation is less than the $5B funding it has raised to date.
- The firm has faced many challenges in recent months and is currently restructuring operations and cutting costs to turn around the company's fortunes.
- Byju's missed its revenue target for the last financial year and delayed the submission of audited financial statements.
- In June, auditor Deloitte stepped down, prompting three of Byju's board members to resign soon thereafter.
- The firm is also in the process of resolving a debt of $1.2B.
- Additionally, India's money laundering agency, the Enforcement Directorate, is investigating the firm for violating the nation's forex law.
Zoom out: - Prosus has called Byju's one of the large underperformers this year, along with online pharmacy startup Pharmeasy, which raised capital this year at a 90% lower valuation.
- The net asset value of Prosus' e-commerce portfolio slumped from $50B in FY 2022 to $29B in FY 2024.
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| 5 | | NXTP secured $98M in capital commitments towards its third fund. The third fund is the firm's largest yet to date and will help the firm invest in 25 to 30 early-stage B2B startups across Latin America, primarily in Brazil. 50% of the capital will be invested in Brazilian startups, while the remaining will be invested in Mexico, Colombia, Argentina, Chile, and other Latin American countries. More: - NXTP will invest across cloud computing, software, fintech and payments, e-commerce, B2B marketplaces, data, and AI sector startups.
- The fund will invest from pre-seed to Series A stages, writing checks ranging from $500,000 to $5M.
- The firm has already backed online payments platform Barte and AI-powered edtech startup Teachy.
- NXTP will set aside a certain amount from the fund to make follow-on investments.
- NXTP has backed 130 startups to date, the most notable of which are Auth0, Nuvemshop, and Mural.
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| 6 | | Today's Funding: Biotech - Aro Biotherapeutics, a startup developing tissue-targeted genetic medicines, secured $41.5M in Series B funding led by Cowen Healthcare Investments. Johnson & Johnson Innovation, Northpond Ventures, and BVF Partners participated in the round.
Climate tech - One Click LCA, a startup helping construction companies measure carbon emissions, bagged €40M ($43.8M) in fresh funding led by PSG Equity and joined by InfraVia Capital Partners.
Data - DataBank raised $188M in equity funding from existing and new investors to support the construction of new data centers. Additionally, the firm received a $345M construction loan, bringing the total raised in the current financing round to $533M.
Enterprise software - Procurement management and payment processing solutions provider Candex secured $45M in Series B funding. Goldman Sachs led the round with additional participation from World Innovation Lab, Altos, NFX, Craft, JP Morgan, American Express, and Edenred.
Fintech - Healthcare payments fintech platform PayGround closed its Series A round at $19.7M. SixThirty led the round, joined by Rally Ventures, IA Capital Group, FCA Venture Partners, and Plug and Play Ventures.
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| 7 | | Quick Hits: - Competitors are killing your efficiency. Read how Greenhouse gained $85mil in revenue from reps who used Klue over non-Klue users.*
- Pershing Square Capital Management's founder, Bill Ackman, believes that the Federal Reserve could start cutting interest rates as soon as the first quarter of 2024.
- European VC firm Augmentum Fintech CEO Tim Levene believes that fintech valuations have returned to 2018 and 2019 levels after reaching absurd levels in 2020 and 2021.
- European B2B SaaS investor Oxx closed its second fund at $190M.
- FEBE Ventures has secured commitments for 90% of the $75M target for its second fund. Fund II will invest in pre-seed and seed-stage startups, writing checks ranging from $250,000 to $750,000.
*This is sponsored content. | | | |
 | Analyst | | Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot. | | This newsletter was edited by Aaron Crutchfield | |
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