This is The TechCrunch Exchange, a newsletter that comes out every Saturday, based on the column of the same name. You can sign up for email here.
This is an active week in the world of technology wide, with big news from Facebook and Twitter and Apple. But beyond the noise that got the headline, there was a steady drumbeat of bullish news for unicorns, or private companies worth $ 1 billion or more.
A bullish week for unicorns
Exchange spends a great chunk of the week looking at different stories from unicorns, or companies that will soon fit the bill, and it’s amazing to see how much positive financial news there has been a tap even past what was written.
Databricks, for example, disclosed strict financial data to TechCrunch prior to regular publication, including the fact that its annual run rate (not ARR) grew to $ 350 million by the end of Q3 2020, from $ 200 million in Q2 2019 It is important to have an IPO ready, but not in a hurry in the public markets.
Stick to our theme, Calm want more money for a big new appreciation, perhaps as high as $ 2.2 billion which is not a surprise. That is better news of the unicorn. As reported by “Razorpay of India [became a] unicorn after its new $ 100 million round of funding ”which came out this week.
Razorpay is just one of a number of Indian startups that became unicorns during the COVID-19. (And here’s another melting point this week regarding the half-dozen beginnings that became the unicorn “in the middle of the pandemic.”)
There has been enough good news of the unicorn recently that we have lost track of it all. Things like Seismic raised $ 92 million, pushing its analysis up to $ 1.6 billion from a few weeks. How to get lost in the mix?
All of this is important because while the IPO market has gained a lot of attention in the last month or so, the unicorn world is still not sitting still. In fact, it feels like unicorn VC activity is the highest we have seen since 2019.
And, as we’ll see in just a moment, the grist for the unicorn mill fills up again as we speak. So, expect more of the same until something material breaks our current investment and exit pattern.
What do unicorns eat? Money And many, many VCs have accumulated money in the last seven days.
Following is a partial list. Investors may be looking to lock in new funds before the election and any turmoil that may occur. So, in no particular order, here’s who the new flush is:
- $ 450 million for OpenView, $ 800 million for Canaan, $ 840 million for True Ventures, $ 950 million for Lead Edge Capital
- Something called Benson Capital Partners has raised a $ 50 million fund. Gayle Benson, from whom the company is named, owns several New Orleans sports teams, per Forbes.
- Plus Venture Capital, built by two former investors in 500 Startup Mena according to fundglobalMENA, raised $ 60 million.
- First Round is looking for $ 220 million, former Google exec Kai-Fu Lee Sinovation Ventures is looking for a billion, while Khosla wants a little more.
All of that capital has to go to work, which means a lot of rotation for many, many starts. Exchange also caught up with a relatively new company this week: Race Capital. With the help of Alfred Chuang, formerly or BEA who is now an angel investor who manages his own funds, the firm has $ 50 million to invest.
Stick to private investments in startups at the moment, so much has happened this week that we need to know about. As API-driven Argyle boosted $ 20 million from Bain Capital Ventures for what FinLedger calls “unlocking and democratizing access to job records.” TechCrunch is currently monitoring the progress of API-led startups.
On the material side, M1 Finance raised $ 45 million for its consumer fintech platform in a Series C, while another roboadvisor, Wealthsimple, raised $ 87 million, becoming a unicorn at once. And while we were in the fintech bucket, Stripe dropped $ 200 million this week for Nigerian startup Paystack. We need to pay more attention to the scene at the start of Africa. At the smaller end of fintech, Alpaca raised another $ 10 million to help other companies become Robinhood.
A few more notes before we change the tack. Kahoot raised $ 215 million due to a boom in remote education, another unavoidable trend in 2020 as part of the larger edtech boom (our own Natasha Mascarenhas has more).
Moving from the private market to the public, we need to hit the SPACs in just a moment. Exchange got on the phone this week with Toby Russell from Shift, now a public company, trading after it merged with an SPAC, particularly Insurance Acqu acquisition Corp. Early trading was just fine, but the CEO outlined for us he certainly chased after an SPAC, which was really interesting:
- The shift may have been made public by an IPO, Russell said, but gave priority to a SPAC-led debut because his firm wanted to optimize for an increase in capital to sustain company growth.
- How about Private investment in public equity (PIPE) option SPAC has ensured that Shift has hundreds of millions of cash.
- Shift also wants to minimize what the CEO describes as market risk. A deal with SPAC is possible regardless of what the wider markets are up to. And while the company chose to debut through a SPAC in April, some precautions, hopefully, could make little sense.
So now Shift is public and newly capitalized. Let’s take a look at what happens to its shares as it enters the three-month reporting groove. (Obviously, if it is floating, it is a bad mark for SPACs, but, on the contrary, successful trading can lead to a bit more momentum in SPAC-mageddon.)
A few more things and we’re done. The beautiful Unicorn release has a great week. First, Datto’s IPO continues to move forward. It set an initial price this week, which could be valued above $ 4 billion. Also this week, Roblox announced that it has filed to be public, albeit private. It also costs billions. And finally, DoubleVerify is looking to become public at nearly $ 5 billion early next year.
Not all liquidity comes through the public markets, as we saw in Twilio buying Segment, an agreement negotiated by The Exchange to find out whether it is priced or not.
Different and Sundry
We run long naturally, so here are some quick things to add to your weekend tea and coffee mentally on the weekend!
Next week we dig deeper into Q3 venture capital data, a prelude you can see here, about female founders, a topic we’ll be back to Friday in more depth.