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Detroit Firm Ludlow Needs No Introduction to Remote Deals
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By Yuliya Chernova, WSJ Pro
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Good day. Remote investing became de rigueur in the venture industry during the pandemic. But for Detroit-based Ludlow Ventures, it has been a fact of life for the past decade.
Ludlow, which just raised a $60 million new seed-focused fund, has made about 120 investments so far, and practically all of those were done after only meeting founders virtually, according to General Partner Jonathon Triest. Most of its portfolio companies are in San Francisco, Los Angeles and New York, with a smaller portion in the Midwest, he said.
Physical distance hasn’t stopped Ludlow from building a big network in Silicon Valley and beyond. The firm, for example, introduced its San Francisco-based portfolio company Density to Upfront Ventures, which became its Series A lead, and Founders Fund, which became its Series B lead, according to Andrew Farah, the startup’s chief executive and co-founder.
The biggest long-distance payoff for Ludlow so far was its seed investment in Honey Science Corp. in 2014. In that case, the Detroit firm did meet the founding team when on other business in Los Angeles, and committed to investing on the spot, Mr. Triest said. Last year, PayPal Holdings Inc. acquired Honey for about $4 billion, helping Ludlow post a return of more than five times on its first $15 million fund, according to Mr. Triest. The Honey founders invested in Ludlow's new fund Ludlow Detroit III.
Ludlow’s limited partners also include Dan Gilbert, a Detroit-based billionaire and owner of the basketball team Cleveland Cavaliers. Ludlow also counts Vintage Investment Partners, Grinnell College, Foundry Group Next and Greenspring Associates among its institutional backers, according to Mr. Triest.
And now on to the news...
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Ryan Popple, left, co-founder of Proterra, and then California Gov. Jerry Brown, with at a Proterra facility in Los Angeles in 2017. PHOTO: WALT MANCINI/ASSOCIATED PRESS
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Back in business. SPAC interest in taking clean-technology startups public is likely to draw more venture investors to the sector after a decade in which few such companies backed by venture capital went public, WSJ Pro’s Yuliya Chernova reports.
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“The venture industry moves toward returns,” said Dan Oros, partner at G2VP, a venture firm focused on sustainable industrial technology that spun out of the Kleiner Perkins Green Growth Fund and has had three companies that agreed to merge with SPACs in recent months.
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SPACs are solving two problems for clean technology venture investors and startups: providing a clearer path to an exit and offering scale-up funding for capital-intensive businesses. In that way, SPACs are decreasing the risk of investing in earlier stage startups, Mr. Oros said.
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About 30 SPACs that raised $9 billion in capital were still looking for clean technology acquisition targets as of the end of the year, according to investment bank Nomura Greentech.
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The number of years the typical U.S. homeowner in 2020 had remained in place, up slightly from 12.8 years in 2019 and well ahead of 2010’s reading of 8.7 years, according to Redfin Corp. (WSJ)
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Home-Financing Startup Knock Names First CFO
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Home-financing startup Knockaway Inc. hired its first finance chief as it looks to expand into dozens of markets amid strong demand for housing in the U.S., Brooke Henderson reports for CFO Journal. Michelle DeBella started as chief financial officer of New York-based Knockaway, which does business as Knock, on Dec. 28. Previously, she served as a vice president at Lyft Inc., overseeing its financial transformation and governance.
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Knock has raised $600 million from investors, including RRE Ventures, Foundry Group, Redpoint, Greycroft, Corazon Capital, Correlation Ventures, Great Oaks Venture Capital and FJ Labs.
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Last week, WSJ Pro asked how the sweeping action technology giants took following the Capitol Hill riot could affect startups and venture investing.
David Pakman, partner at venture firm Venrock, wrote to WSJ Pro that the moves to remove then-President Donald Trump serve as a turning point for social networking companies having to “bear some editorial responsibility.”
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“The trickle down here will be that (larger) social platforms of most stripes will need to increase human editorial capabilities internally,” Mr. Pakman wrote. “I do think this is a manageable problem that won't scare investors away from the sector, per se, but many investors have already been dissuaded by the super-dominance of Facebook and the others in this space.”
This week’s question: Are we on the cusp of a surge in automotive-tech deals? Several companies—Rivian and Cruise—tapped high-profile public investors this month. Legacy automakers saw stock rallies this week amid electric vehicle exuberance. But are there still venture bets to be made?
Please email WSJ Pro with responses at marc.vartabedian@wsj.com.
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Funds
Matrix Partners China seeks to raise $1.2 billion for its sixth fund, according to a regulatory filing. The firm recently participated in funding rounds for Senti Biosciences Inc., D3 Bio Inc. and InventisBio Inc.
Early-stage investor Crosslink Capital raised $350 million in commitments for its ninth flagship venture fund. The San Francisco- and Menlo Park, Calif.-based firm secured $275 million for its previous venture fund in 2018. With the new fund, Crosslink promoted Phil Boyer to partner. Before joining the firm in 2014, he was an investor at Tenfore Holdings.
Sustainable food investor Blue Horizon Ventures closed its first flagship fund with €183 million ($222 million). Limited partners in the fund include European Investment Fund EIF, Wire Group’s Private Markets Funds, Group Bimbo, Sigma, B8Ventures and Korys/Colruyt Group. Zurich-based Blue Horizon invests globally anywhere from €300,000 to €25 million over the lifetime of a company. Recent investments include Mosa Meat, Geltor and Cubiq Foods.
People
Eight Roads Ventures promoted Aditya Systla, Betty Cai, Ju Zhang and Lucile Cornet to partner. Prior to joining Eight Roads Ventures India in 2015, Mr. Systla held positions at Peepul Capital, Warburg Pincus and Goldman Sachs. Ms. Cai joined Eight Roads Ventures China in 2011 and was previously at China Renaissance. Before joining the Chinese team in 2017, Mr. Zhang was at FreeS Fund and Lightspeed China Partners. Ms. Cornet joined Eight Roads Ventures Europe in 2015, and previously held positions at Summit Partners, Moelis and Co. and Bank of America Merrill Lynch.
Data-analytics company Incorta appointed Scott Jones as chief executive. He replaces Osama Elkady, who will become chief technology officer. Mr. Jones was previously president and chief revenue officer at Alteryx. San Mateo, Calif.-based Incorta is backed by investors including Sorenson Capital, GV, Kleiner Perkins, M12 and Telstra Ventures.
Cancer antibody developer Trishula Therapeutics Inc. named Anil Singhal as chief executive. He was previously president and CEO of Adicet Bio. South San Francisco, Calif.-based Trishula is backed by Abingworth, AbbVie Ventures, Canaan Partners, InterWest Partners, Lightstone Ventures and MPM Capital.
Exits
IG Group Holdings PLC, a U.K.-based operator of online trading platforms, agreed to buy brokerage and financial-media firm Tastytrade Inc. for $1 billion. Founded in 2011 and based in Chicago, Tastytrade is backed by investors including TCV.
Medical device maker Boston Scientific Corp. agreed to buy Preventice Solutions Inc., a provider of mobile cardiac-health equipment and services, for $925 million in cash and up to an additional $300 million in a potential commercial milestone payment. Marlborough, Mass.-based Boston Scientific already holds a roughly 22% stake in Preventice, resulting in a net payment of about $720 million at closing and a milestone payment of up to about $230 million. Preventice, based in Eagan, Minn., raised a $137 million Series B round of funding in July from Vivo Capital, Novo Holdings, Merck Global Health Innovation Fund, Boston Scientific and Samsung Catalyst Fund.
Amateur esports platform PlayVS is expanding to high school esports in Canada with the purchase of GameSeta Esports Inc. Terms weren’t disclosed. Los Angeles-based PlayVS is backed by investors including New Enterprise Associates, Battery Ventures, Sapphire Sport and others.
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TripActions Inc., a Palo Alto, Calif.-based corporate travel startup, scored $155 million in Series E funding, increasing the company’s valuation to $5 billion. Andreessen Horowitz, Addition and Elad Gil led the round, which included participation from Zeev Ventures, Lightspeed Venture Partners and Greenoaks Capital.
Globality Inc., a Menlo Park, Calif.-based startup that helps companies source services globally, completed a $138.3 million Series E round from Sienna Capital and SoftBank Vision Fund. Colin Hall, vice chairman of Sienna Capital, will join the company’s board.
SOCi Inc., a San Diego- and Austin, Texas-based provider of social media and reputation management for multilocation businesses, closed an $80 million Series D round. JMI Equity led the round, which saw participation from Ankona Capital and SOCi’s chief executive.
Quali, an Austin, Texas-based platform for cloud and dev-ops automation, picked up a $54 million investment. Greenfield Partners and JVP co-led the round, which included additional support from Kreos Capital and a fund managed by Hamilton Lane. Shay Grinfeld, managing partner at Greenfield Partners, joined the board.
iSTOX, a Singapore-based digital securities platform, closed a $50 million Series A round from JIC Venture Growth Investments, Development Bank of Japan Inc., Juroku Bank, Mobile Internet Capital, Singapore Exchange, Tokai Tokyo Financial Holdings and Hanwha Asset Management.
Multiverse, which offers a tech apprenticeship program, closed a $44 million Series B round. General Catalyst led the funding, which included support from GV, Audacious Ventures, Index Ventures and Lightspeed Venture Partners. The company also appointed Jeremy Duggan as president.
Indy, a French provider of accounting services to freelance workers, collected €35 million ($42 million) in Series B funding. Singular led the round, with participation from Alven Capital and Kerala Ventures. With this investment, Georges.tech changed its name to Indy.
Higher Ground Education Inc., a Lake Forest, Calif.-based school management platform dedicated to expanding the reach of Montessori education, nabbed a $40 million investment and acquired Altitude Learning’s technology platform for an undisclosed sum. Venn Growth Partners led the Series C round, which included participation from Learn Capital, Peak State Ventures, Nimble Ventures and others. Altitude Learning, formerly known as AltSchool, previously raised funding from investors including Founders Fund, Andreessen Horowitz and the Chan Zuckerberg Initiative.
Plexium Inc., a San Diego-based developer of protein degrading therapeutics to treat cancer and other serious diseases, added $35 million in Series A funding, bringing the round total to $63 million. Lux Capital and Pivotal BioVentures led the new tranche, with participation from Column Group, DCVC Bio and others. Lux Capital’s Adam Goulburn and Pivotal BioVentures’ Rob Hopfner will join the board. Mike Grey will join the board as an independent director and chairman.
Shippeo, a Paris-based supply chain analytics startup, secured a $32 million investment from Battery Ventures, NGP Capital, ETF Partners, Partech and Bpifrance Digital Venture.
Quantifind Inc., a Menlo Park, Calif.-based provider of tools to help automate financial crime investigations, fetched $22 million in growth funding from S&P Global, In-Q-Tel, Snowflake Ventures and existing investors.
Ironhack, a Miami-based coding and web design bootcamp, snagged $20 million in Series B financing. Lumos Capital led the round, with Managing Partner James Tieng joining the board. Endeavor’s Catalyst Fund, Brighteye and Creas also contributed to the investment.
Wintermute, a London-based algorithmic liquidity provider for digital assets, raised $20 million in Series B funding. Lead investor Lightspeed Venture Partners was joined by Pantera Capital, Blockchain.com Ventures, Sino Global Capital, Kenetic Capital, Rockaway Blockchain Fund, Hack VC, DeFi Alliance and Avon Ventures in the round. Jeremy Liew, a partner at Lightspeed, will join the board.
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