Nearly 250 years ago, the economist and philosopher Adam Smith wrote The Wealth of Nations, in which he described the birth of a new form of human activity: industrial capitalism. It would lead to the accumulation of wealth beyond anything that he and his contemporaries could have imagined.
Capitalism has fuelled the industrial, technological and green revolutions, reshaped the natural world and transformed the role of the state in relation to society. It has lifted innumerable people out of poverty over the last two centuries, significantly increased standards of living, and resulted in innovations that have radically improved human well-being, as well as making it possible to go to the Moon and read this article on the internet.
However, the story is not universally positive. In recent years, capitalism’s shortcomings have become ever-more apparent. Prioritizing short-term profits for individuals has sometimes meant that the long-term well-being of society and the environment has lost out – especially as the world has faced the Covid-19 pandemic and climate change. And as political unrest and polarisation around the world have shown, there are growing signs of discontent with the status quo. In one 2020 survey by the marketing and public relations firm Edelman, 57% of people worldwide said that “capitalism, as it exists today, does more harm than good in the world”
The company, a subsidiary of Lottomatica Holding, was acquired by Gamenet, via its financial sponsor Apollo Global Management, for EUR 950 million on May 12, 2021.
DEAL LEADER ( International Game Technology PLC )
Fabio Cairoli, 54, is Chief Executive Officer, Italy, and is responsible for managing all business lines, marketing services, and sales for the Company’s Italian operations. Through his leadership of the largest lottery operator in the world, Mr. Cairoli shares insights and best practices with other organizations in the Company. Mr. Cairoli joined the Company in 2012 as Senior Vice President of Business. He has more than 20 years of experience in consumer goods for multinational organizations, with both local and international expertise. He served as Group General Manager and Board Member of Bialetti Industrie, a world-renowned Italian manufacturer and retailer of stovetop coffee (espresso) makers and small household electrical appliances. During his tenure at Bialetti, he was responsible for turning around the business by refocusing strategy, streamlining costs, and optimizing the product portfolio and retail presence. Prior to Bialetti, Mr. Cairoli served as General Manager of Star Alimentare, a major Italian food company, and successfully relaunched a historical brand. Additionally, he spent part of his career with Julius Meinl Italia and with Motorola Mobile Devices Italy. He also spent 10 years with Kraft Foods in Italy and the U.K. in various capacities. Mr. Cairoli holds a Bachelor’s degree in Economics from the Catholic University in Milan.
Asapp, Inc., a New York based artificial intelligence research-driven company, raised $120m with Dragoneer Investment Group and Fidelity Management & Research leading the deal (see below form more information)
Smartly.io acquired Viralspace.ai, a Palo Alto, Calif.-based digital advertising A.I. startup. Viralspace investors have included Lightspeed Venture Partners and Quest Venture Partners.
Wysa, a Boston MA-based company that provides an AI-powered mental health platform, raised $5.5M in Series A funding
Cervest, a London UK-based company which specializes in Al-powered Climat Intelligence (CI) platform, raised $30m in Series A funding
SymphonyRM, a Palo Alto, CA-based provider of AI powered patient engagement solutions for health systems, raised $25m in Series B funding
Heru Inc., a Miami FL-based company developer of wearable AI-powered vision diagnostics and augmentation software, raised $30m in Series A funding
(See List of 50+ Deals Below)
DEAL OVERVIEW ( Asapp, Inc. )
Developer of a machine learning software designed to make customer experiences more productive. The company’s AI platform augments, automates and enhances conversations with customers to close more deals while focusing on complex and data-rich problems, enabling customer care teams, salespeople and other organizations to be more efficient and effective while realizing their full potential and increase efficiency.
The CEO, Mr. Gustavo Sapoznik, is a Co-Founder and serves as Chief Executive Officer and Board Member at Asapp.
DEAL VALUATION ( Asapp, Inc. )
The company raised $120 million of Series C venture funding in a deal co-led by Dragoneer Investment Group and Fidelity Management & Research on May 19, 2021, putting the company’s pre-money valuation at $1.48 billion. Telstra Ventures, March Capital, Emergence Capital Partners, 40 North Ventures, Victor Wang, Marcus Westin, John Doerr, John Chambers, and Euclidean Capital also participated in the round. The funds will be used to increase investment in its AI Native® and Customer Experience Performance (CXP) platform.
DEAL (Recent AI Deals)
Sempra Energy reached a definitive agreement to sell a 20% stake in the company to Kohlberg Kravis Roberts for $3.37 billion on April 4, 2021. The transaction values the company at approximately $25.2 billion. Proceeds from the sale will be used to help fund growth across Sempra Energy’s $32 billion capital program, which is centered on its U.S. utilities and to further strengthen its balance sheet. The company is being actively tracked by PitchBook.
The company raised $135 million of Series B venture funding in a deal led by Bain Capital Life Sciences on May 11, 2021, putting the company’s pre-money valuation at $335 million. Fairmount Funds Management, Driehaus Capital Management, Boxer Capital, Venrock, Deerfield Management, Fidelity Management & Research, Wellington Management, Viking Global Investors, Janus Henderson Investors, Avoro Capital and Logos Capital also participated in the round. The funds will be used to advance clinical trials and expand the discovery research pipeline. Previously, the company raised $50 million of Series A venture funding from Deerfield Management and other undisclosed investors on January 27, 2021, putting the company’s pre-money valuation at $20 million.
The company raised $114.76 million of Series D venture funding from Decheng Capital, Philos & Partners and Cormorant Asset Management on March 5, 2021, putting the company’s pre-money valuation at $350 million. Other undisclosed investors also participated in the round.
The company raised $114 million of Series A1 venture funding in a deal led by venBio on March 9, 2021, putting the company’s pre-money valuation at $184 million. OrbiMed, Vivo Capital, Qiming Venture Partners, New Science Ventures, Third Point Ventures, RTW Investments, Janus Henderson Investors, Wellington Management, Cormorant Asset Management, Surveyor Capital and Farallon Capital Management also participated in the round. The funds will be used to accelerate the clinical development of immunology programs and advance preclinical programs against novel drug targets with the prolific drug discovery engine.
The company raised $107 million of Series C venture funding in a deal led by venBio on March 1, 2021, putting the company’s pre-money valuation at $150 million. GV, PagsGroup, The Invus Group, HBM Healthcare Investments, 6 Dimensions Capital, Deerfield Management, Cormorant Asset Management, Farallon Capital Management, Blue Pool Capital, Casdin Capital and T. Rowe Price also participated in the round. The funds will be used to advance its lead, only-in-class Helicon peptides aimed at addressing substantial cancer patient populations into clinical development.
The company raised GBP 58.93 million of Series A venture funding from Access Industries, Lightspeed Venture Partners and Eldridge (Greenwich) on April 8, 2021, putting the pre-money valuation at GBP 260 million. The funds will be used to expand operations by acquiring studios and rollout the next generation of titles.
Rapid Micro Biosystems
The company raised $81 million of Series D1 venture funding in a deal led by D1 Capital Partners on March 16, 2021, putting the company’s pre-money valuation at $625 million. Bain Capital, Ally Bridge Group, Endeavour Vision, Xeraya Capital, Quaker Partners, Longitude Capital, Asahi Kasei Medical, BlackRock, T. Rowe Price, Adage Capital Management, Sunley House Capital Management and CaaS Capital Management also participated in the round. The funds will be used to accelerate the company’s growth.
The company raised $80 million of Series E venture funding in a deal led by Matrix Capital Management and Surveyor Capital on March 22, 2021, putting the company’s pre-money valuation at $200 million. Chiesi Ventures, Lundbeckfond Ventures, Medicxi, Ysios Capital, Advent Life Sciences, Arix Bioscience, Columbus Venture Partners, Velosity Capital, Rock Springs Capital and Adage Capital Management also participated in the round. The funds will be used to advance the clinical development of its VDC technology platform, including the pivotal Phase 3 program for AU-011, its lead candidate in development for the first-line treatment of choroidal melanoma, and ongoing research for additional programs in ocular oncology, as well as expanding the VDC technology into bladder cancer, the first non-ophthalmic solid tumor indication.
The company raised $70 million of Series C venture funding in a deal led by Ontario Teachers’ Pension Plan on May 20, 2021, putting the company’s pre-money valuation at $296.26 million. The Goldman Sachs Group and 9 other investors also participated in the round. The company intends to use the fund to accelerate the development of the company’s industry-leading data and suite of products to serve institutions with diverse clients and complex risk exposure.
The company raised $50 million of venture funding in a deal led by PeakSpan Capital on April 16, 2021, putting the company’s pre-money valuation at $150 million. The funds will be used to continue its history of high caliber innovation velocity and dedication to delivering superior customer success at scale, for the most demanding customers across the globe.
The company raised $40 million of Series A venture funding in a deal led by HBM Healthcare Investments and Samsara BioCapital on April 6, 2021, putting the company’s pre-money valuation at $37.5 million. Adams Street Partners and Catalys Pacific also participated in the round. The company intends to use the fund to complete a phase 2 proof-of-concept study for its lead experimental hypertension treatment, MLS-101 and for preparatory work for late-stage testing of the therapy.
Fenergo, an Ireland-based digital enabler of client and regulatory technology for financial services, raised $80 million. DXC led the round and was joined by the venture arm of Dutch bank ABN Amro.
Kajabi, an Irvine, Calif.-based e-commerce platform for entrepreneurs in the knowledge economy, raised $550m in growth equity financing that values the company at over $2 billion
DoubleVerify, launched Initial Public Offering
Upon the completion of the acquisition, RealPage shareholders were entitled to receive $88.75 in cash per share. The price per share represents a 30.8 percent premium to the company’s closing share price of $67.83 on December 18, 2020, and a premium of 36.5 percent over RealPage’s 30-day volume-weighted average share price through December 18, 2020. With the completion of the acquisition, RealPage becomes a privately-held company, and its common stock ceased trading and will no longer be listed on the Nasdaq stock exchange.
LEADERSHIP (CEO RealPage)
Mr. Stephen Winn is the Founder and serves as Chairman of the Board & Chief Executive Officer at RealPage. He has served as RealPage chief executive officer, chairman of the board, and a member of our board of directors since November 1998. Prior to RealPage, Mr. Winn served in various executive positions, including president of Research Institute of America, a provider of information services to the accounting industry and a wholly owned subsidiary of Thomson Reuters Corporation, and president and chief executive officer of Computer Language Research Inc., a publicly traded company focused on tax compliance, tax research and accounting software, which was acquired by Thomson Reuters Corporation. Mr. Winn was one of five people recognized by the National Apartment Association as a leader in the multifamily industry. Accounting Today recognized him as one of the 100 most influential people. In June 2012, Mr. Winn was an Ernst & Young Entrepreneur of the Year 2012 Southwest Area North Award recipient. He is an active member of the National Apartment Association and National Multifamily Housing Council. Mr. Winn received his Bachelor of Science in electrical engineering from the University of Texas at Austin and his Master of Science in management from Stanford University.
OTHER DEALS (PE SOFTWARE DEALS MONEY RAISED TO DATE IN MILLIONS)
Goldbelly, a New York City?-based maker of a food e-commerce platform, raised $100 million in Series C funding. Spectrum Equity led the round and was joined by investors including Intel Capital. (DISCLOSURE: A Red Hook Capital Fund has co-invested in the D round with Spectrum Equity)
Coiled, a New York-based machine-learning and A.I. data company, raised $21 million in funding. Bessemer Venture Partners led the round. (DISCLOSURE: Red Hook Capital has co-invested in deals with Bessemer Venture Partners )
Houm, a Chile-based all-in-one platform for homeowners to rent and sell their properties, raised $8 million in seed funding. Investors included Y Combinator, Goodwater Ventures, OneVC, Vast VC, Liquid2, and Myelin. (DISCLOSURE: Red Hook Capital has co-invest in deal with Y Combinator)
Platinum Equity agreed to acquire Game Taco, a Sausalito, Calif.-based skill-based mobile gaming platform. Game Taco will also acquire WorldWinner, a skill-game company, from GSN Games, which is owned by Sony Pictures Entertainment. Financial terms weren’t disclosed. (DISCLOSURE: Red Hook Capital has advised Platinum Equity on other mergers and place bids on Platinum Equity portfolio companies in the past).
Ankorstore, a Paris-based curated marketplace for independent brands and retailers, raised $100 million in series B funding. Tiger Global and Bain Capital Ventures led the round and were joined by investors including Index Ventures, Global Founders Capital, Alven, and Aglaé. (DISCLOSURE: Red Hook Capital has co-invest in deal with Tiger Global)
MasterClass is raising $225 million in a new round of funding that it will use to launch a new enterprise business and expand internationally.
It more than triples the start-up’s valuation to $2.75 billion, according to sources.
The Series F was led by Fidelity, with participation from Baillie Gifford, Eldridge, IVP and NEA.
Online learning platform MasterClass has been valued at $2.75 billion in a new round of funding. That’s more than triple its valuation from 3q2020, according to Pitchbook.
MasterClass, the streaming platform that makes it possible for anyone to learn from the best, today announced that it has raised $225M in Series F funding, led by Fidelity Management & Research Company and with participation from new investors including Baillie Gifford, Balyasny Asset Management and Eldridge together with existing investors IVP, Javelin, NEA and Owl Ventures. Disclosure: This report is a portfolio company of Red Hook Capital that co-invested in the deal through a SPV in this round).
MasterClass relies on a subscription model for revenue. An annual subscription costs $180 and allows users unlimited access. For EBITDA companies, the number of subscribers could influence the valuation or a multiple of EBITDA.
A member of the The Capitalization Report would be happy to discuss in details valuation of this company with the requirement that they are an accredited investor with proof of funds (can use our PROOF program) or an owner in a company with EBITDA greater than $3 million.
CEO & GENERAL PARTNERS CLOSING DEALS
David Rogier is profiled today for raising $225 million in a new round of funding that it will use to launch a new enterprise business and expand internationally
David Rogier is the founder and CEO of MasterClass, the streaming platform where anyone can learn from the world’s best across a wide range of subjects. As a kid, Rogier loved learning but often struggled in school. In 2015, he created MasterClass to reinvent the traditional model and provide life-long learning opportunities for everyone.
MasterClass has since transformed the online learning category providing intimate access to over 90 of the world’s best practitioners.
In 2020, David Rogier was named one of the most influential leaders in media and entertainment on Fortune’s “40 under 40” list and as one of Variety’s Hollywood New Leaders.
RECENT DEALS THAT CLOSED OF INTEREST
Healogics, a Jacksonville, Fla.-based provider of wound care, raised $240 million. Clayton Dubilier & Rice, Partners Group, and Northwestern Mutual invested $75 million. Marathon Asset Management invested some $165 million (DISCLOSURE: A member of Red Hook Capital S.E.A. was a former board member of Northwestern Mutual).Merge, a San Francisco and New York City-based business-to-business API company, raised $4.5 million in seed funding. NEA led the round. (DISCLOSURE: A Red Hook Capital Fund has invested in NEA Fund).
BEST TAX QUOTE: “Render therefore unto Caesar the things which are Caesar’s; and unto God the things that are God’s.” – Quote by Who?
PROVOCATIVE STATEMENT: If you are a HNWI, there is a 99.9% chance that tax day for most is national tax extension day for the HNWI! – JDM20210415 (aka April 15, 2021 normal tax day)
Was it Albert Einstein ( physicist), Plato (philsosophier), James Madison ( U.S. President), Ronald Regan (U.S. President), Thomas Jefferson (U.S. President), Winston Churchfield (U.K. Primeminister), or Guest Who?
“A tax loophole is something that benefits the other guy. If it benefits you, it is tax reform.” — Russell B. Long, U.S. Senator
“Income tax has made more liars out of the American people than golf.” — Will Rogers, humorist
Guest Who? “The hardest thing in the world to understand is the income tax.”
Guest Who? “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
Guest Who? “The best things in life are free, but sooner or later the government will find a way to tax them.”
Guest Who? “I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
Guest Who? “Where there is an income tax, the just man will pay more and the unjust less on the same amount of income.”
Guest Who? “A fine is a tax for doing something wrong. A tax is a fine for doing something right.”
Guest Who? “A person doesn’t know how much he has to be thankful for until he has to pay taxes on it.”
Guest Who? “People who complain about taxes can be divided into two classes: men and women.”
Guest Who? “We don’t have a trillion-dollar debt because we haven’t taxed enough; we have a trillion-dollar debt because we spend too much.”
Guest Who? “To compel a man to furnish contributions of money for the propagation of opinions which he disbelieves and abhors is sinful and tyrannical.”
Guest Who? “The power of taxing people and their property is essential to the very existence of government.”
“To tax and to please, no more than to love and to be wise, is not given to men.” — Edmund Burke, 18th Century Irish political philosopher and British statesman
“I am proud to be paying taxes in the United States. The only thing is – I could be just as proud for half the money.” — Arthur Godfrey, entertainer
Guest Who? “People who complain about taxes can be divided into two classes: men and women.”
“No government can exist without taxation. This money must necessarily be levied on the people; and the grand art consists of levying so as not to oppress.” — Frederick the Great, 18th Century Prussian king
“Like mothers, taxes are often misunderstood, but seldom forgotten.” — Lord Bramwell, 19th Century English jurist
“The best measure of a man’s honesty isn’t his income tax return. It’s the zero adjust on his bathroom scale.” — Arthur C. Clarke, author
“Next to being shot at and missed, nothing is really quite as satisfying as an income tax refund.” — F. J. Raymond, humorist
“Few of us ever test our powers of deduction, except when filling out an income tax form.” — Laurence J. Peter, author
“Taxation with representation ain’t so hot either.” — Gerald Barzan, humorist
“Taxes are what we pay for civilized society.” — Oliver Wendell Holmes, Jr., U.S. Supreme Court Justice
Contact Jack D. or Charlotte F. for the key to “quest who” via a LinkedIn. Thanks – JD Morris
One of the most daunting tasks you are likely to face after having successfully founded a growing startup can be securing enough capital to pay the bills until the expanded operations begin to pay for themselves. Startups seeking funding for their expansions have a number of options for securing capital, but you still need to convince investors that your business is worthwhile as an investment. An understanding of the funding landscape will help hone your sales pitch and increase the odds of a successful capital campaign.
Unfortunately, the American business ideal of steady growth over the long term has been replaced in the minds of many entrepreneurs by dreams of founding a unicorn company that explodes onto the scene and cashing out through an initial public offering. Startup founders need to keep in mind that the likelihood of founding a unicorn is incredibly small, but there are other successful strategies for rapid growth using outside capital. Those strategies should be centered on producing a high company valuation and creating significant wealth for yourself and your investors.
Mr. Morris (JDM) focuses on serving on the board of advisors and board of directors of several private companies. His family of Special-Purpose Vehicle (SPV) invests in a wide range of businesses. JDM has helped close more than $91 billion in deals—leading more than $7 billion in enterprise value of these deals.
He has been a speaker at various industry forums, has been quoted in numerous leading publications, and has made several appearances on Bloomberg, CNET, CNBC, ESPN, and many media outlets. Mr. Morris hosted an educational radio show about financing deals and other hot topics after Bloomberg morning news.
Mr. Morris received a B.A. in economics with mathematics from Hampden-Sydney College in Virginia, where he worked in the development office to pay his way through college. He is an Omega Rho Honor Society student in Washington, D.C., with The George Washington University (GWU). JDM is currently working on finishing a program under MIT Sloan Business School, as well as the MIT Computer Science & Artificial Intelligence Laboratory (CSAIL) in two years.
WHAT PEOPLE ARE SAYING ABOUT J. MORRIS
Mr. Morris was able to close a difficult international backbone financing for a start-up company for $20.0 million. Dealing with the uncertainties of Brazilian government regulations, tight emerging capital markets, and choosy investors, he raised this equity capital when no other advisors were able to even look at the deal. He is highly qualified and capable.” – President & CFO of NASDAQ that he lead the IPO (Update: Retired early and does what makes him happy).
“He is first-rate, good ideas all the time and honesty all the way. Work with the Man.” – Former acting Secretary of the US Air Force (Update: Chairman of a fund of funds).
“Mr. Morris has a gift of connecting the right people at the right time. His Investor Network has a wide range of executives and family offices that have been very helpful to me in my ventures and life” – Founder & former CEO of Tarana Wireless (Update: Active investor and close to exit with Tarana).
“I have worked with him on several acquisition transactions. I have always found him to be professional and timely. Mr. Morris delivers what he says he will in the right time frame. When he is an advisor, as opposed to the principal, he seems to have a knack for getting the two parties together. When the principal, he gets his deals done.” – Partner of Nelson Mullins and reconnized by rewards as top M&A lawyer for DC metro area.
“Mr. Morris has been a great resource in helping me learn the ins and outs of raising capital. Every opportunity that I raise capital for, I look to JD for his guidance. His relationships with investors are enormously valuable. Additionally, he has graciously allowed me to speak on his radio show which gave my venture at the time great exposure. Thanks.” – Former Media Consultant to Fortune 100 companies and serial entrepreneur (several exits).
“I have known Mr. Morris for several years and am consistently impressed with his energy and contact base. He is well connected to the VC Community and maintains relationships with the top management of many local and regional companies. He has an excellent track record of raising capital and of advising companies wishing to do so.” Consultant to Fortune 500 companies (Update: retired or does what makes him happy).
“I’ve had the pleasure of working briefly with Mr. Morris on two projects and being in a finance industry group with him. He has a combination of finance and LBO expertise, analytic skill, business connections and enthusiasm that would make him a valuable asset to most corporate or advisory boards.” – Bay Area CPA and former FENG leadership.
“Mr. Morris has a wide source of contacts for funding. He finds the best source of capital for a particular company’s financing needs and knows how to structure the deal. He is creative, enthusiastic, and easy to work with. I am happy to recommend him to my clients and others.” Former Partner at Akerman Senterfitt LLP.
ABOUT RED HOOK CAPITAL
ABOUT RHC’S EBITDA FUNDS & SPECIAL PURPOSE ENTITIES (SPV/SPE)
We provide creative capital, structured for each investment opportunity. Our wealth of experience, industry expertise, deep operating skill sets, and large global network of affiliated partners position us as a vital resource from which management can draw strategic, financial, and operational guidance. RHC invests in companies across a broad range of industries and geographies. Our goal is to help management teams build long-term value that benefits all stakeholders. We structure our private equity investments based on each company’s circumstances and generally seek to invest in established businesses requiring equity capital between $10 million and $1 billion. Red Hook Capital maintains a broad acquisition profile focused on acquiring businesses with its equity partners that exhibit a certain set of characteristics:
> fragmented market
> recurring revenues
> loyal customers
> strategic complements to our portfolio
This acquisition profile enables us to identify opportunities for creating value in virtually any industry.
ABOUT RHC’S HYBRID FUNDS AND SPECIAL PURPOSE ENTITIES (SPV/SPE)
We are launching a hybrid fund that will allow accredited investors to pledge an amount of capital. More to come! Below are SPV investments through co-investing with venture capital funds:
BrightInsight 1q2021 (Co-Invested in deal with other VC firms such as Eclipse Ventures, General Catalyst, Insight Partners, New Leaf Venture Partners, & Proof.VC as share holders)