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DoorDash Goes Shopping: Term Sheet

DoorDash bought food delivery rival Caviar from Square for $410 million.
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The food delivery wars continue in full force.

Food delivery giant DoorDash bought rival Caviar for $410 million. Square, the mobile payments company, had owned Caviar since 2014, and it was looking to offload the service.

“We have not been shopping around,” DoorDash CEO Tony Xu said. But when Square’s Jack Dorsey reached out about a month ago, Xu said he saw an opportunity that would beef up its business to better take on competitors such as Postmates, Grubhub, and UberEats.

DoorDash already provides delivery services for more than 310,000 restaurants across 4,000 cities in the U.S. and Canada. But it has historically expanded across suburban areas. Meanwhile, Caviar, founded in 2012, has focused on urban cores.

My colleague Danielle Abril reports:

The details of how the two services would be integrated haven’t been determined.

DoorDash, founded in 2013, is still in growth mode, Xu said. The company was most recently valued at $12.6 billion after a $600 million funding round in May, according to PitchBook. The delivery service has been one of the most capitalized player in the industry, raising $1.97 billion since inception, as it competes against the rivals Uber Eats, Grubhub, and Postmates.

In addition to its restaurant delivery, DoorDash also earns money from its DoorDash Drive platform, which allows businesses to integrate DoorDash’s technology and fulfillment services into its own app or website. The platform helped DoorDash land Walmart and become as its largest delivery partner, serving 1,000 stores nationwide. DoorDash also generates revenue from its a service that lets customers order food online for pick it up themselves, and DashPass, its monthly subscription offering.

And there are more services coming, Xu said.

“Restaurant delivery is just the beginning on how we hope to touch and grow every local business,” he said.

Read more at Fortune.

BIG NEW MONEY: Toronto-based startup Clearbanc, which funds companies’ purchases of Facebook and Instagram ads in exchange for a fee, raised $300 million in new funding. Of that capital, $50 million is a Series B equity investment led by Highland Capital, with iNovia and Emergence Capital also participating.

The remaining $250 million will go into Clearbanc’s third fund, which it uses to invest in e-commerce companies under unique terms: Clearbanc fronts the money startups need to purchase digital ads, but instead of taking an ownership stake, Clearbanc charges a 6% flat fee, taking a share of the companies’ revenue until it is paid back. Read more.

LOVES ME, LOVES ME NOT: You know when you think one thing & then it turns out the reality of it is totally different? Well, you’ll enjoy this survey. Private equity firms often tout the value they bring to the management teams of the companies they back. But a new survey reveals something entirely contradictory.

PE-focused consulting and technology firm Accordion surveyed 200 private equity executives and portfolio company chief financial officers about their interactions. Here’s what it found:

Among the 100 private-equity professionals surveyed, 92% said they believe they are living up to the expectations of their portfolio company CFOs. But only 29% of the 100 CFOs in the survey agree.

¯_(ツ)_/¯

Have a great weekend!

VENTURE DEALS

Babylon Health, a London-based startup that has developed a number of AI-based health services, raised $550 million in funding at a valuation of more than $2 billion. Investors include Saudi Arabia’s Public Investment Fund, Munich Re’s ERGO Fund, Kinnevik and Vostok New Ventures.

UrbanClap, an India-based marketplace for freelance labor, raised $75 million in Series E funding. Tiger Global led the round, and was joined by investors including Steadview Capital and Vy Capital.

Armory, a San Francisco-based developer of an open source platform for delivering software, raised $28 million in Series B funding. Insight Partners led the round. Investors include Crosslink Capital, Bain Capital Ventures, Mango Capital, Y Combinator and Javelin Venture Partners.

FNA, a London-based deep technology analytics company, raised $5.5 million in Series A funding. IQ Capital led the round, and was joined by investors including GETTYLAB.

Holloway, a San Francisco-based online publishing company producing comprehensive professional guides on various topics, raised $4.6 million in seed funding. Investors include NEA, The New York Times Co., and South Park Commons.

Biome Makers, a San Francisco-based technology company that uses data analytics and artificial intelligence to analyse the soil’s ecosystem and provide data-driven insights to farmers, raised $4 million in funding. Seaya Ventures and JME Ventures co-led the round, and was joined by investors including LocalGlobe.

HEALTH AND LIFE SCIENCES DEALS

Prellis Biologics, a San Francisco-based human tissue engineering company, raised $8.7 million in Series A funding. Khosla Ventures led the round.

PRIVATE EQUITY DEALS

KKR will acquire certain international operations, including Australian snacks unit Arnott’s, from Campbell Soup Company for approximately $2.2 billion. Read more.

Progressio acquired a minority stake in Polenghi Food S.p.A, an Italy-based distributor of lemon and lime juice products for the condiments industry, from the Polenghi family. Financial terms weren’t disclosed.

Fenix Parts, which is backed by Stellex Capital, acquired the assets of Cox Truck and Van Inc, a Gainesville, Ga.-based operator of a full-service auto recycling facility. No financial terms were disclosed.

CoolSys, which is backed by Ares Management, acquired Agape Mechanical, a Lakeville, Minn.-based specializes in HVAC, refrigeration, electrical and plumbing services, as well as hot water hydro-scrubbing. Financial terms weren’t disclosed.

Level Equity made an investment in Planet DDS, a Costa Mesa, Calif.-based company behind a dental practice management software solution provider. Financial terms weren’t disclosed.

Congruex, which is backed by Crestview Partners, acquired HHS Construction, an Ontario, Calif.-based provider of infrastructure services to major telecommunications and cable providers. Financial terms weren’t disclosed.

Audax Private Equity invested inStonewall Kitchen, a York, Maine-based specialty food producer. Financial terms weren’t disclosed.

Steele Compliance Solutions Inc, a Bregal Sagemount portfolio company, acquired Osprey Compliance Software, a Waltham, Maine-based provider of corporate compliance and oversight software. Financial terms weren’t disclosed.

Ambiente Wine, a portfolio company of Fountain Square Industries, acquired Hops & Vines Distributing, a San Antonio, Texas-based craft beer distributor based in San Antonio, Texas. Financial terms weren’t disclosed.

IPOs

I-Mab, a Chinese drug developer, is filing for an IPO in the U.S. that could raise up to $200 million, Bloomberg reports citing sources. Read more.

RAPT Therapeutics, a South San Francisco-based biotech firm creating therapies for cancer and inflammatory diseases, postponed plans to raise $75 million in an IPO of 5 million shares priced between $14 to $16. The Column Group (34.7% pre-offering), KPCB Holdings (20%), and Topspin Fund (12.2%) back the firm. It planned to list on the Nasdaq as “RAPT.” Read more.

EXITS

Kellermeyer Bergensons Services LLC, a portfolio company of GI Partners, acquired Pristine, an Austin, Texas-based provider of facility management, contract cleaning and related services. Financial terms weren’t disclosed. The seller was Great Elm Capital Corp.

FIRMS + FUNDS

Gron Ventures, a Newport Beach, Calif.-based venture capital firm, raised more than $117 million for its debut fund, according to an SEC filing. The target is $150 million.

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