- Transacted
- Posts
- Closed doors at OpenView
Happy Wednesday. Here’s what we’ve got today…
One headline deal and an update on recent news out of OpenView Venture Partners
The deal sheet, plus a look at what’s next in infrastructure investing
1. Mistral shows that AI hasn’t cooled much yet.
• Mistral AI, a Paris-based generative artificial intelligence startup, is nearing a deal to raise around €450 million in new funding.
• Andreessen Horowitz is set to lead the round with a €200 million commitment, with total equity funding of €325 million. Nvidia and Salesforce are contributing an additional €120 million of convertible debt.
• The raise builds on Mistral’s remarkable year. Just a month after its founding, the startup closed a $113 million seed round led by Lightspeed, the largest-ever for a European startup. This week’s follow-up comes mere months later and is expected to reach a $2 billion valuation.
• As part of the deal, Mistral’s three co-founders took the opportunity to sell a portion of their stakes, reported as an undisclosed amount greater than €1 million — they didn’t have long to wait for some liquidity.
PRESENTED BY WALL STREET PREP
A leading business school and the training provider of choice for 4 of the top 5 largest private equity firms have partnered up…
The Wharton School and Wall Street Prep have developed a unique "theory-meets-practice" Private Equity Certificate Program that’s now open for enrollment.
The 8-week self-paced course is career-oriented, with a learn-by-doing approach that focuses exclusively on the practical expertise that had previously only been taught within the most competitive firms.
Those firms play a role here, too — the program is sponsored by Blackstone, KKR, Carlyle, and Thoma Bravo, with guest speakers including David Rubenstein (Carlyle, Co-Founder and Co-Chairman), Martin Brand (Blackstone, Head of North America Private Equity), and Scott Graves (Ares Management, Co-Head of Private Equity).
Join thousands of other alumni who have accelerated their careers with Wharton and Wall Street Prep programs.
Boston-based OpenView Venture Partners has dismissed most of its investment staff and will halt new deal activity, The Information first reported on Tuesday.
The early-stage firm has raised $2.4 billion since inception and employed more than 100 people, according to its LinkedIn.
The firm’s portfolio companies were caught off-guard by the news, with at least one executive noting their surprise in early public comments. A subsequent portfolio communication from OpenView noted that the firm has entered into a “voluntary suspension period,” with senior leadership saying that “after extensive discussion and evaluation, the partners do not have confidence in the ability to deliver on our commitment” to the firm’s new fund, raised earlier this year.
OpenView did note that it will continue in its current board roles and retain reserve funding capacity.
The news follows a string of high-profile departures from 17-year-old OpenView. Recent exits include founder and senior managing director Scott Maxwell, partners Mackey Craven, Ricky Pelletier, and Sanjiv Kalevar, and investor Andrew Camel.
Unconfirmed speculation points to the possibility that the surprise departures may have triggered a “key man” clause within the fund’s limited partnership agreement. Such a clause hands limited partners the authority to halt new investments should certain general partner leadership leave the firm (and should no continuity agreement be reached between GP and LPs).
Even if such a clause came into play, OpenView’s senior leadership appears to have made the decision to preemptively wind down the firm, rather than try to hammer out a go-forward plan with its LPs.
The underlying cause of the leadership tumult remains unknown, though recent performance may have been a factor. OpenView’s sixth fund, a $450 million vehicle raised in 2020, was most recently marked at a negative 10 percent IRR.
Previous winners have also faltered. Recent filings show OpenView sold off more than 10 million shares of expense management software platform Expensify in August, having held a portion of their original position since the company’s 2015 Series C. The value of that holding at exit was nearly 90 percent below the company’s 2021 peak shortly after its IPO.
The lackluster performance was reflected in OpenView’s fundraising efforts for its seventh flagship fund. The firm held a $570 million final close in March of this year, nearly 30 percent below its stated $800 million target.
The venture environment has certainly become more turbulent of late, but there’s probably more going on behind the scenes here — expect the full story to come out in the coming weeks.
DEALS, DEALS, DEALS
• Alaska Air (NYSE: ALK) has agreed to acquire Hawaiian Airlines (Nasdaq: HA) for $1.9 billion.
• Farfetch (NYSE: FTCH) CEO José Neves, with backing from existing shareholders Richemont, Alibaba, and JP Morgan, is considering a take-private of the luxury fashion retailer.
• Equitrans Midstream (NYSE: ETRN) is reportedly considering a sale, with the $4 billion market cap company hiring Goldman Sachs as its advisor.
• Origin Energy (ASX: ORG) will remain independent following the collapse of Brookfield’s $19.1 billion buyout offer after shareholders rejected its second bid.
• Washington H. Soul Pattinson submitted a $2 billion takeover bid for Perpetual, an Australian asset and wealth manager, which was rejected.
• Five9 (Nasdaq: FIVN) is exploring a sale that could value the telecom company at around $7 billion.
• Ares Management acquired Burnham RNG, an agricultural waste to RNG provider, from Edge Natural Resources.
• GIC is in discussions to purchase an interest in Atlas SP, an Apollo-owned securitization business.
• Hudson Hill Capital acquired a majority stake in MarketTime, a B2B wholesale platform.
• Softbank Group acquired a 51% stake in Cubic Telecom, a Dublin-based connected car tech company, at a $927 million valuation.
• Blackstone is weighing a sale of Anthos Therapeutics, a developer of genetically-validated and novel anticoagulants focused on inflammatory thrombotic diseases formed via a joint venture with Novartis.
• Jana Partners urged Frontier Communications to explore strategic options, including a possible sale of the company.
• Concentra Biosciences, backed by Tang Capital, offered to acquire ophthalmology and oncology-focused biotech LianBio (Nasdaq: LIAN) for around $465 million.
• Francisco Partners reached a deal to combine Siedler Equity Partners-backed music publisher Hal Leonard with music content and creator platform Muse Group.
• New Mountain Capital agreed to sell the life science instrumentation developer Covaris to PerkinElmer, both of which are New Mountain portfolio companies.
• Resurgens Technology Partners acquired Valant, a Seattle-based behavioral health EHR platform backed by Gemspring Capital.
• Truelink Capital acquired Ansira, a St. Louis-based marketing technology and service provider, from Abry Partners.
• Roche agreed to acquire Carmot Therapeutics, a California-based developer of obesity therapeutics, for $2.7 billion upfront.
• Saks Fifth Avenue's latest $3 billion bid for rival Neiman Marcus has been rejected, per the WSJ.
• Reverence Capital Partners is seeking buyers for up to a 20 percent stake in wealth management firm Osian at a potential valuation of around $2.5 billion.
• H.I.G. Capital acquired Tallahassee-based Mainline Information Systems, a designer of custom IT solutions.
• Trive Capital agreed to acquire indoor entertainment center operator Ten Entertainment Group for £287 million ($362 million).
• Fitch Group acquired Bixby Research and Analytics, a provider of credit data and analytics for private debt and leveraged finance.
PUBLIC OFFERINGS
• PureHealth, a Dubai-based medical lab and diagnostics business backed by ADQ, is targeting a $1 billion raise in a domestic IPO.
VENTURE & GROWTH
• X.ai Corp., Elon Musk’s AI startup, disclosed that it’s seeking up to $1 billion in outside equity funding, of which around $135 million has already been committed.
• Pragmatic, a Newcastle-based semiconductor startup, raised £180 million (approx. $225 million) in Series D funding. M&G Catalyst and UK Infrastructure co-led, with participation from Northern Gritstone, Latitude, MVolution, and returning investors British Patient Capital, Cambridge Innovation Capital, and Prosperity7.
• Seismic Therapeutic, a biotech working on machine-learning-enabled protein therapeutics, raised $121 million in Series B funding. Bessemer Venture Partners led, with participation from Amgen Ventures, Codon Capital, Alexandria Venture Investments, Gaingels, GC&H, and existing backers Timothy A. Springer, Lightspeed Venture Partners, Polaris Partners, Boxer Capital, GV, and Samsara BioCapital.
• Vast Data, a developer of storage infrastructure solutions to enable cloud-like infrastructure and scalability, raised $118 million in Series E funding. Fidelity led, with participation from existing backers NEA, Bond, and Drive Capital.
• Odyssey Therapeutics, a biotech startup focused on modulating immune cell metabolism, raised $101 million in Series C funding. Ascenta Capital Partners led, with participation from existing backers OrbiMed, General Catalyst, and BlackMars Capital.
• Gecko Robotics, a developer of AI-powered infrastructure inspection and repair robots, raised $100 million in an extension of its Series C round. Investors included Founders Fund and USIT.
• Foretellix, a developer of open-scenario testing and analytics software designed to aid in the development of autonomous vehicle technologies, raised $85 million in Series C funding led by 83North, with participation from Temasek, Woven Capital, MoreTech, Nationwide, Volvo Group VC, Jump Capital, and Next Gear Ventures.
• AssemblyAI, an AI-based speech processing company, raised $50 million in Series C funding. Accel led, with participation from Keith Block, Nat Friedman, Daniel Gross, and Insight Partners.
• Nth Cycle, a developer of critical metals refining technology, raised $44 million, including $37 million in Series B funding and $7 million in venture debt. VoLo Earth Ventures, MassMutual's MM Catalyst Fund, Caterpillar Venture Capital, and Equinor participated.
• Fantuan, a food delivery and local services platform, raised $40 million in Series C funding led by GrubMarket and Celtic House Asia Partners, with participation from VisionPlus Capital, JSD Capital, and others.
• Replicate, a developer of open-source AI/ML models, raised $40 million in Series B funding led by A16z, with participation from NVentures, Heavybit, Sequoia Capital, and YC.
• Dust Identity, a developer of invisible barcodes for product verification, raised $40 million in Series B funding. Castle Island Ventures led, with participation from Amex Ventures, Kleiner Perkins, Airbus Ventures, and 8VC.
• ArmorCode, a cybersecurity compliance and risk management platform, raised $40 million in Series B funding. HighlandX led, with participation from NGP Capital, Ballistic Ventures, Sierra Ventures, and Cervin.
• Keboola, a data engineering and integration platform, raised $32 million in Series A funding. Viking Global Investors led, with participation from Reflex Capital, Presto Ventures, and TCF Capital.
• Leonardo.ai, an Australian developer of generative AI for designers, raised $31 million from Blackbird, Side Stage Ventures, Smash Capital, TIRTA Ventures, Gaorong Capital, and Samsung Next.
• AM Batteries, focused on next-generation dry electrode manufacturing for lithium-ion batteries, raised $30 million in Series B funding led by Toyota Ventures, with participation from Porsche Ventures, Asahi Kasei, and RA Capital Management, among others.
• Eligo Bioscience, a biotech targeting genetic disorders caused by the microbiome, raised $30 million in Series B funding. Sanofi Ventures led, with participation from Bpifrance, Khosla Ventures, and Seventure Partners.
• Rich Data Co., a developer of AI decisioning platforms for banks, raised $17.5 million in Series B funding. Westpac and nCino led, with participation from BMYG and Octava Fund.
• EnCharge AI, a developer of hybrid digital and analog in-memory compute systems for AI workloads, raised $22.6 million in funding from VentureTech Alliance, RTX Ventures, and ACVC Partners.
• Atomic Industries, a provider of AI-powered autonomous manufacturing solutions, raised $17 million in Seed funding. Narya led the round, with new investors 8090 Industries and Acequia Capital New Industrials, and existing backers Porsche Ventures, Yamaha Motor Ventures, Toyota Ventures, and Impatient Ventures.
• Kyron Learning, a K-12 AI learning platform, raised $14.6 million in Series A funding from Global Silicon Valley (GSV) Partners, Owl Ventures, ECMC Group, Common Sense Fund, Charter School Growth Fund, Cambiar Education, LearnerStudio, Provi College Fundamental Fund and Imagine Learning.
• Ketryx, a provider of a digital life sciences compliance and quality management platform, raised $14 million in Series A funding led by Lightspeed Venture Partners, with participation from Ubiquity Ventures and MIT’s E14 Fund.
• Extropic AI, a developer of AI chips, raised $14.1 million of seed funding led by Kindred Ventures, with participation from Weekend Fund, Valor Equity, HOF Capital, Buckley Ventures, Maque VC, and Julian Capital.
• January Technologies, a fintech focused on debt collection, raised $12 million in Series B funding. IA Ventures led, with participation from Brewer Lane Ventures, Third Prime, Reciprocal Ventures, Upper90, Shrug Capital, and several angels.
• Cloudsmith, a provider of software supply chain management solutions, raised $11 million in Series A2 funding. MMC Ventures led the round.
• Asato.ai, a San Francisco-based CIO copilot intelligence platform in beta, raised $7.5 million in seed funding. The round was co-led by Intel Capital and Walden Catalyst Ventures' Lip-Bu Tan, with participation from Shah Capital Partners.
FUNDRAISING
• American Securities is targeting $7 billion for its ninth buyout fund
• Ares raised around $3.3 billion for a real estate secondaries fund.
• Copenhagen Infrastructure Partners is targeting $3 billion for its second emerging markets fund.
• RRJ Capital is targeting more than $1.25 billion for an Asia-focused private credit fund.
• Avenir Growth Partners is raising up to $800 million for its fourth fund.
• Canapi Ventures raised $750 million in new funds focused on early-stage fintech investments.
• Partech is targeting €300 million for its first impact fund.
THE READOUT
1. Infra insights and market update.
• KKR released its Q3 Infrastructure market review, providing a status update and a look at key themes heading into 2024. — Infrastructure Market Review, KKR
2. Greenlight’s Q3 investment letter.
• A copy of David Einhorn’s Greenlight Capital investor update. — Q3 Update, Greenlight Capital
PARTNERSHIPS
Interested in partnering with Transacted? If you’re a brand looking to connect with an engaged financial audience, we’re here for it. Please reach out.