By Polina Marinova
December 19, 2017

WHY NOT MORE?

Good morning, Term Sheet readers.

Masayoshi Son strikes again.

Lemonade, a New York-based peer-to-peer insurance company powered by artificial intelligence, raised $120 million in Series C funding. SoftBank Group led the round, and was joined by investors including General Catalyst, GV, Sequoia Capital, Thrive Capital, and Tusk Ventures.

The company first launched in New York a little more than a year ago. Since then, it’s obtained licenses in 25 states as well as a shiny, new valuation of $500 million.

In case there was any question that Softbank is fundamentally reshaping the tech financing landscape, consider this: Softbank has been behind each of the largest financings in Silicon Valley in the last month, including WeWork, DoorDash, and Uber (Note: The DoorDash deal has not yet been confirmed and the Uber deal has not yet been completed). This comes at no surprise as Son said in October the Japanese tech giant could commit as much as $880 billion to tech investments in the coming years.

These bombshell amounts will undoubtedly inflate already-inflated tech valuations, while also pumping hundreds of millions of dollars into startups that don’t necessarily need it. Take Wag, the dog-walking app, for example. The company was originally looking to raise $100 million in its latest round, but that amount quickly jumped to $300 million once Softbank expressed interest. With a player like Softbank in the ecosystem, tech founders are asking themselves, “Why not raise more?”

When I spoke with Krishna Gupta from Romulus Capital last month, he told me we’re living in an insatiable time. Gupta started his fund in 2008, which was a very, very different time for venture capital. The talent was more clustered and the valuations were more realistic. He used the following example: In 2008, founders went out to raise $2 million and ended up raising only $500,000. Today, they go out to raise $2 million, and it’s not uncommon for them to end up with $5 million.

“The most important thing for founders to know is that this won’t last forever,” he told me.

But here’s an unpopular opinion: I think it actually might. As much as we blast companies for raising more than they need, sub-optimally spending their resources, and ruining their cultures in the meantime, are we even at the peak yet?

What about Softbank’s planned $200-billion vision fund, which is twice as large as the first, yet-unspent one? What about Vision Funds 3, 4, and 5? And let’s not forget the massive global sovereign wealth funds that are just now joining the game. There are also the investor darlings — Alibaba and Tencent — that have morphed into powerful investors in their own right.

So no, the “bubbly” funding levels of 2017 probably won’t last forever — they might get even bubblier.


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• How Bitcoin is challenging the very concept of venture capital

• Investors are lining up to buy this cryptocurrency with ‘no purpose‘ (by Emily Price)

…AND ELSEWHERE

Congress poised to approve biggest tax overhaul in 30 years. Here’s what’s in the final tax bill. A small fintech stock surged 2,600% in a week after announcing it’s a crypto company. HQ Trivia’s founders are facing fundraising roadblocks after investors learned of alleged bad behavior.


VENTURE DEALS

ThinkForce, a China-based developer of intelligent semiconductors chips, raised 450 million Chinese yuan ($68 million) in a Series A funding round. Investors include YITU Tech, Yunfeng Fund, Sequoia Capital and Hillhouse Capital.

Daily Harvest, a New York-based subscription service specializing in frozen, plant-based, one-step-prep foods, raised $43 million in funding. Lightspeed Venture Partners led the round, and was joined by investors including VMG Partners. Investors including M13, Bobby Flay, Shaun White, and Haylie Duff participated. Read more at Fortune.

Bigfoot Biomedical, a medical device company using artificial intelligence which aims to optimize insulin delivery, raised $37 million in the initial tranche of a Series B equity funding. Janus Henderson Investors and Quadrant Capital Advisors co-led the round. Existing investors Cormorant Asset Management, Senvest Capital Inc., Senvest Management LLC, Visionnaire Ventures, JDRF T1D Fund and T1D Exchange participated.

Maana, a developer of digital knowledge technology solutions, raised $28 million in Series C funding. China International Capital Corporation and Eight Square Capital led the round, and was joined by investors including Accenture Ventures and Sino Capital. Existing investors Intel Capital, GE Ventures, Chevron Technology Ventures, Saudi Aramco Energy Ventures and Shell Technology Ventures participated.

Fyusion, a San Francisco-based developer of 3-D image processing technology and photo-sharing application, raised $22 million in Series B funding. Investors include New Enterprise Associates and Presence Capital, 2020, NTT DOCOMO Ventures, Colopl, and Gionee.

Label Insight, a Chicago-based company focused on product transparency, raised $21 million in Series C funding. Investors include Delta-v Capital and River Cities Capital Funds.

DigitalGenius, a U.K.-based developer of AI for customer service, raised $14.75 million in Series A funding. Global Founders Capital led the round, and was joined by investors including MMC Ventures, Paua Ventures, Kairos, Salesforce Ventures, Runa Capital, RRE Ventures, Lumia Capital, Compound and Lerer Hippeau Ventures.

Didja, a technology company dedicated to augmenting television, raised $12 million in funding. Vestech Partners led the round.

Quinyx, a Sweden-based provider of cloud-based software, raised $12 million in funding from Battery Ventures.

Springboard, a San Francisco-based provider of online workforce upskilling, raised $9.5 million in Series A funding. Costanoa Ventures led the round, and was joined by investors including Learn Capital, Jyoti Bansal, Blue Fog Capital, Rocketship.vc, and Moneta Ventures.

Tovala, a Chicago-based manufacturer and supplier of a domestic cooking appliance, raised $9.2 million in Series A funding. Origin Ventures led the round. Pritzker Group, Y Combinator, Joe Mansueto, and Larry Levy participated.

Bigfinite, a San Francisco-based provider of data analytics and AI solutions for optimizing the pharmaceutical manufacturing process,raised $8.5 million in seed funding. Investors include Crosslink Capital, Uncork Capital (formerly SoftTech VC) and La Famiglia. Industry Ventures and Krohne also participated in the round.

FarmWise, a San Francisco-based creator of adaptive autonomous farming equipment, raised $5.7 million in seed funding. Investors include Playground, Felicis Ventures, Basis Set Ventures, and Valley Oak Investments.

Canvas Technology, a Boulder, Colo.-based robotics company building autonomous technology for industrial applications, raised $15 million in Series A funding. Playground Global led the round, and was joined by investors including Xplorer Capital, AME Cloud Ventures and Morado Ventures.

springbig, a Boca Raton, Fla.-based company focused on loyalty marketing technology for the cannabis industry, raised $3.2 million in funding. Green Acre Capital and HALLEY Venture Partners led the round, and was joined by investors including The Arcview Group.

Heretik, a Chicago-based software company that uses machine learning in the contract review process, raised $2.4 million in seed funding. Corazon Capital led the round, and was joined by investors including Chicago Ventures and Relativity.

Pig.gi, an Android lock screen app that lets users earn free mobile airtime, raised $2.3 million in seed funding from Archipelago Global.

Streem, a company connecting home service professionals to their customers through on-demand video streaming, raised more than $1.7 million in funding. Investors included GVR Fund, Flying Fish, Columbia Ventures Corp, Rogue Venture Partners, Curious Capital, betaworks Ventures, Greycroft, GGV Capital and General Catalyst AR Fund.

Farmcrowdy, a Nigeria-based digital agriculture platform, raised $1 million in seed funding. Investors include Cox Enterprises, Techstars Ventures, Social Capital, Hallett Capital and Right-Side Capital.

Stitch Health, a San Francisco-based company that helps manage patient health data through care checklists, team chat rooms, and patient conversations, raised Series A funding of an undisclosed amount. Benchmark led the round, and was joined by investors including the Y Combinator Continuity Fund.


HEALTH AND LIFE SCIENCES DEALS

Luna DNA, a genomic and medical research knowledge base powered by the blockchain, raised $2 million in seed funding. Investors include former executives from Illumina.


PRIVATE EQUITY DEALS

Maysteel Industries, a portfolio company of Littlejohn Capital, acquired DAMAC Products, a La Mirada, Calif.-based manufacturer of custom data center infrastructure equipment. Financial terms weren’t disclosed.

TA Associates made an investment in Healix, a provider of outsourced alternate-site infusion therapy management services. Financial terms weren’t disclosed.

DC Capital Partners Management LP acquired Janus Global Operations, a Lenoir City, Tenn.-based provider of integrated stability operations. Financial terms weren’t disclosed.

American Leather, which is backed by Capital Partners, acquired Brookline Furniture, a High Point, N.C.-based manufacturer and supplier of upholstered seating. Financial terms weren’t disclosed.


OTHER DEALS

Tencent Holdings Ltd said it would lead an $863 million investment in apparel platform Vipshop Holdings (NYSE: VIPS). Tencent will invest $604 million for a 7% stake, while e-commerce firm JD.com Inc, which already owns about 2.5% in Vipshop, will invest $259 million to increase its stake to 5.5%, according to Reuters. Read more.

Ola will acquire Foodpanda’s India business from its parent company DeliveryHero. The deal will see Ola scoop up the Foodpanda India business with DeliveryHero taking an undisclosed amount of Ola stock in exchange, and Ola will invest $200 into Foodpanda India.

Greenyard NV said it was in advanced negotiations to acquire Dole Food Company, a Westlake Village, Calif.-based fruit and vegetable producer, according to Reuters. Dole could be valued at more than $2.5 billion, including debt. Read more.


IPOs

Pinnacle Renewable Energy Inc, a wood pellets producer owned by Canadian private equity firm Onex Corp, filed a preliminary prospectus with the Toronto Stock Exchange for an initial public offering of its common shares. The company expects to raise about C$175 million ($136.10 million) from the share sale.


EXITS

Didi Chuxing agreed to acquire 19Pay, a China-based payment services company for RMB300 million ($45 million), according to China Money Network. 19Pay had raised approximately $9.5 million in venture funding from investors including Sequoia Capital and Zero2IPO Ventures. Read more.

Platinum Equity agreed to acquire Husky Injection Molding Systems, a Bolton, Ontario-based provider of injection molding equipment and services for the plastics industry, from Berkshire Partners and OMERS Private Equity for $3.85 billion.

The Carlyle Group agreed to acquire a majority stake in MedRisk, a King of Prussia, Penn.-based provider of physical medicine solutions to the workers’ compensation industry, from TA Associates. Financial terms weren’t disclosed.


FIRMS + FUNDS

Hadean Ventures, a Norway-based venture capital firm, raised $118 million for its life sciences fund.


PEOPLE

Aspect Ventures appointed Lauren Kolodny to partner.

Matthew Savino joined The Carlyle Group as a managing director and head of U.S. capital markets.


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Polina Marinova produces Term Sheet, and Lucinda Shen compiles the IPO news. Send deal announcements to Polina here and IPO news to Lucinda here.

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