Big VC Losses on Instacart

Sequoia and a16z are taking big losses on their Instacart investments, Brazil wants rich nations to pay for the global energy transition, Hollywood never figured out the streaming model, France may sell fuel at losses to curb inflation, a White House team is headed to Detroit to resolve the UAW strike, and Erdogan wants Musk to build a Tesla factory in Turkey.

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Sequoia and a16z are taking big losses on their Instacart investments, Brazil wants rich nations to pay for the global energy transition, Hollywood never figured out streaming, France may sell fuel at losses to curb inflation, a White House team is headed to Detroit to resolve the UAW strike, and Erdogan wants Musk to build a Tesla factory in Turkey.

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Let’s dive in.

Before The Bell

As of 9/15/2023 market close.

Markets

  • US stocks dropped ahead of this week’s Fed policy meeting

    • The Nasdaq led indices with a 1.56% decline

  • Asian stocks mostly closed higher after China’s August economic data was better than expected

Earnings

  • What we're watching this week:

    • Tuesday: AutoZone

    • Wednesday: FedEx, General Mills

    • Thursday: Darden Restaurants

  • Full calendar here

Headline Roundup

  • China's economy shows signs of stabilizing but property slump threatens outlook (RT)

  • Brazil calls on rich nations to pay for global energy transition (BBG)

  • Tech trade is showing cracks, higher rates for longer spell more trouble (WSJ)

  • Hollywood is paying steep price for never really figuring out the streaming model (CNBC)

  • Debt swaps arranged by Credit Suisse, BofA come under scrutiny (BBG)

  • Sequoia, Andreessen to take huge hit on 2021 Instacart investments after a 75% valuation drop (CNBC)

  • France to allow selling fuel at loss to curb inflation (BBG)

  • New Orleans DA fights ‘terrorism’ on streets with AI spycraft (WSJ)

  • EU may become as hooked on China batteries as it was on Russian energy (RT)

  • Grain ships head for Ukraine Black Sea port, defying Russia (BBG)

  • Ultra-rich buy ultra-luxury counseling to get kids into Harvard (BBG)

  • White House team to go to Detroit ‘early this week’ to help resolve UAW strike (CNBC)

  • Student loan restart threatens to pull $100B out of consumers’ pockets (WSJ)

  • Flood of Russian wheat halves world prices from wartime high (BBG)

  • McCarthy demands 8% spending cut, border wall to avert shutdown (BBG)

  • California sued fossil fuel companies for climate crisis (BBG)

  • Planet Fitness shares sink after board ousts CEO in shocking move (CNBC)

  • Erdogan asks Musk to build Tesla factory in Turkey (RT)

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Deal Flow

M&A / Investments

  • The EU set October 19 as its deadline for its initial probe of Pfizer’s $43B acquisition of antibody-drug conjugate leader Seagen (BBG)

  • Discover is considering a sale of its student loan business, which includes a $10.2B portfolio of private student loans (BBG)

  • Media entrepreneur Byron Allen made a $10B bid to buy Disney’s ABC television network and assets including the FX and National Geographic cable channels (RT)

  • PE firm Advent International is exploring a sale of car software provider CCC Intelligent Solutions Holdings, which has a market value of $7.1B (RT)

  • UK insurer Markerstudy will acquire The Ardonagh Group’s personal insurance business in a deal that values the business at $1.5B (BBG)

  • Liberty Global and Warner Bros Discovery kicked off the sale of British television production company All3Media, which could be valued at $1.2B (RT)

  • PE firm 777 Partners acquired struggling Premier League club Everton in a deal worth over $685M (RT)

  • Honey Pot is exploring a sale; the feminine products maker could be valued at over $500M in a potential deal (BBG)

  • Anthony Scaramucci and PE firm Vector Capital emerged as the two leading bidders for SVB Financials’ VC and credit investment arm SVB Capital out of bankruptcy; the unit could sell for $250M-$500M (WSJ)

  • Mobile games and interactive entertainment company Playtika Holdings will acquire Israeli mobile gaming studio Innplay Labs for up to $300M (GNW)

  • Saudi Aramco agreed to acquire Chilean fuel distributor Esmax Distribucion from Southern Cross Group (RT)

VC

  • Mottu, a Brazilian motorcycle rental and last-mile delivery platform, raised a $50M Series C led by QED Investors and Bicycle Capital (FN)

  • Sonex Health, a company specializing in ultrasound-guided treatments for orthopedic conditions, raised a $40M Series B led by KCK MedTech (FN)

  • Duckbill, a startup combining generative AI and human experts to build an execution engine, raised a $33M seed round led by Forerunner Ventures (FN)

  • Hyperjar, a London-based provider of a B2C digital wallet, raised a $24M Series A led by Susquehanna (FN)

  • EV tech startup Evolectric raised $15M in funding led by Seismic Capital (FN)

  • Goodles, a Santa Cruz-based noodle brand, raised a $13M Series A led by L Catterton (FN)

  • Superorder, a startup helping restaurants maintain an online presence, raised a $10M round led by Foundation Capital (TC)

  • Carenostics, a startup using AI to identify undiagnosed and undertreated chronic disease patients, raised a $5M seed round led by M13 (FN)

  • DeFi asset management platform Range Protocol raised a $3.8M seed round led by HashKey Capital and Nomad Capital (FN)

  • Beckley Waves, a venture studio focused on the psychedelic ecosystem, raised $3.3M in funding from Satori Neuro, Evolve Ventures, and more (FN)

IPO / Direct Listings / Issuances / Block Trades

  • Instacart increased its IPO range and is seeking to raise as much as $660M at an up to a $9.9B valuation; it plans to price its IPO shares today and trade on Tuesday (BBG)

  • Marketing automation firm Klaviyo is in advanced discussions to raise its indicative price range for its IPO; it was originally seeking an $8B fully diluted valuation (RT)

  • Japanese translation startup Pocketalk is seeking a Nasdaq IPO at a $1B valuation (BBG)

Debt

  • Saudi Arabia plans to raise $11B from a syndicated loan and appointed Industrial & Commercial Bank of China as coordinator and book runner for the long-term senior, unsecured loan used to finance its investment plans (BBG)

  • PE firm Vista Equity Partners used a net asset value loan from Goldman Sachs that was secured by Vista’s Fund VI to come up with $1B, which unlocked its $5.3B refinancing of portfolio company Finastra Group Holdings (BBG)

  • Coal producer Stanmore Resources is in talks with private credit funds to borrow $750M and banks to borrow $350M for a bid to buy one of BHP Group’s Queensland mines (BBG)

Bankruptcy / Restructuring

  • Turkish contractor Yapi Merkezi is in talks with banks to restructure ~$1B worth of loans after project failures hurt its cash flow (BBG)

  • Boating and fishing supplies retailer West Marine reached a deal to restructure ~$800M of debt out of court (WSJ)

  • Chinese state-linked developer Sino-Ocean Group Holding suspended offshore debt payments, citing tight liquidity (BBG)

  • Abu Dhabi investment firm KBBO Group and its hospital unit received court approval for its restructuring plan (RT)

Fundraising

  • Chimera Investment, part of a business empire overseen by Abu Dhabi royal Sheikh Tahnoon bin Zayed Al Nahyan, set up a $50B fund to invest in PE, VC, private credit, real assets, public equities, and public credit (BBG)

Crypto Corner

  • Blockchain researchers suspect North Korean hackers to be behind a $70M theft from crypto exchange CoinEx (RT)

  • Jaguars QB Trevor Lawrence agreed to settle with claims he helped dupe investors who lost billions in FTX’s collapse (BBG)

  • The United States House Financial Services Committee is advancing legislation aimed at preventing the issuance of a digital dollar (CT)

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