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SEC Removes Proposed Compliance Rules for Fund Advisers
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By Yuliya Chernova, WSJ Pro
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Good day. The Trump administration eased the path for venture firms to become registered investment advisers.
The Securities and Exchange Commission last week withdrew 14 proposed rules, most of which were introduced under former Chair Gary Gensler. These rules would have imposed various compliance obligations on registered investment advisers, including asset custody requirements, cybersecurity risk management and environmental disclosure.
“Registration today is much more manageable than it would have been had all the Gensler-era rules been adopted,” said Stacey Song, partner at law firm Cooley, where she advises on regulatory matters affecting private funds.
Generally, private funds that invest at least 80% of their assets in direct investments in private companies—venture capital’s bread and butter—are exempt from registration requirements.
Some venture firms, however, have sought to become registered investment advisers to have the flexibility to make different types of investments, such as buying public stock, cryptocurrencies and secondary shares.
The SEC’s move under Chairman Paul Atkins, who assumed his role in April, follows another win for the private funds industry. A court last year vacated a set of rules that would have imposed new disclosure requirements on fund fees and performance on private fund advisers. Separately, the SEC has also sought to ease restrictions on retail investor access to private funds, which could make fundraising easier for venture firms.
Note to readers: The VC Health Pulse newsletter won't be published Thursday in observance of Juneteenth in the U.S. We will be back Friday.
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And now on to the news...
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Chime Financial IPO celebrants gathered in New York’s Times Square last week to applaud its market debut. PHOTO: VICTOR J. BLUE/BLOOMBERG NEWS
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PE anticipates IPOs. Private equity-backed companies’ initial public offerings appear poised to take off in this year’s second half as the exit channel reopens and emboldens businesses, WSJ Pro reports.
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Among sponsor-backed companies expected to go public soon are Roark Capital’s Inspire Brands, owner of fast-food chains Dunkin’ and Arby’s. Also, IPOs are anticipated from medical-supply company Medline Industries, whose backers include Blackstone, Carlyle Group and Hellman & Friedman, and NielsenIQ, a consumer intelligence business backed by Advent International and KKR & Co.
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Debt collector Jefferson Capital, controlled by private-equity firm J.C. Flowers & Co., is expected to price its roughly $1 billion IPO next week.
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Private equity holdings account for about half of the roughly 200 companies in the so-called shadow pipeline, which are ready to go public but haven’t disclosed IPO plans, said Mike Bellin, U.S. IPO leader at consulting firm PricewaterhouseCoopers.
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16%
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The annual increase in the number of work meetings after 8 p.m. according to new data from Microsoft on the activity of millions of workers who use the company’s business applications.
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Oracle Unveils Initiative to Help Companies Sell Tech to the Pentagon
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Oracle is unveiling a program that it says will help vendors more easily sell technology, including artificial intelligence, to the Department of Defense, The Wall Street Journal reports.
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The program, called the Oracle Defense Ecosystem, is structured to help smaller companies break through the challenges they typically face in selling tech to the Defense Department, said Rand Waldron, Oracle’s vice president of sovereign cloud.
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“It is far too hard to serve the American defense enterprise,” Waldron said. “We can provide an easy path for these companies to better get access to the defense market.”
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Amazon CEO Says AI Will Lead to Smaller Workforce
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Amazon.com, one of the largest U.S. employers, plans to reduce its workforce in the coming years because increasing use of artificial intelligence will eliminate the need for certain jobs, WSJ reports. Chief Executive Andy Jassy, in a note to employees Tuesday, called generative artificial intelligence a once-in-a-lifetime technological change that is already altering how Amazon deals with consumers and other businesses and how it conducts its own operations.
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People
Edtech-focused investor Owl Ventures appointed Lars Fjeldsoe-Nielsen as a general partner, where he will lead the firm’s strategic expansion across Europe, Africa, the Middle East and other emerging markets.
The T1D Fund, which is focused on treating type 1 diabetes, appointed Lucio Iannone as managing director. He will join the fund in August from Leaps by Bayer.
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Helsing, a defense technology startup, collected €600 million in Series D funding led by Prima Materia.
Applied Intuition, a Mountain View, Calif.-headquartered autonomous driving software developer, completed a $600 million Series F round through a transaction that values the company at about $15 billion. BlackRock and Kleiner Perkins led the funding, which included participation from BOND, General Catalyst, Greycroft and several others.
Ramp, a New York-based financial operations platform, landed $200 million in Series E financing, bringing the company’s valuation to $16 billion. Founders Fund led the round, which saw additional participation from Thrive Capital, General Catalyst, Khosla Ventures and others.
Mach Industries, a Huntington Beach, Calif.-based defense manufacturing startup, closed a $100 million Series B round led by Khosla Ventures and Bedrock.
Nabla, a startup building agentic AI assistants for health systems and providers, raised $70 million in Series C funding. HV Capital led the round, which saw contributions from Highland Europe and others. Nabla has headquarters in Brooklyn, N.Y. and Paris.
Visby Medical, a San Jose, Calif.-headquartered company offering at-home tests for sexually transmitted infections, has secured about $55 million toward a potential $65 million investment led by Catalio Capital Management.
Browserbase, a San Francisco-based infrastructure platform that powers web browsing capabilities for AI agents, grabbed $40 million in Series B funding. Notable Capital led the investment, with Managing Partner Glenn Solomon joining the company’s board.
Sword Health, a Portugal-based healthcare AI provider, picked up a $40 million investment led by General Catalyst at a $4 billion valuation.
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AESC executives and elected Kentucky officials broke ground on the battery factory in Bowling Green, Ky., in August 2022. PHOTO: GRACE RAMEY/DAILY NEWS/ASSOCIATED PRESS
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