BLPA’s Rearview Mirror: End of Summer

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Creative Commons: Matthieu Aubry, 2006

Stung by a bee this morning, just before swim practice. Didn’t think anything of it—brushed something out of my eye on the way out the door. At the end of swim practice my lane-mate asked what was wrong with my eye. Completely swollen. Quite the picture.

But that’s not to stop the Saturday morning task route: Spray the garage roof with chemicals to eradicate the moss and mildew, take the broken Adirondack chair and fluorescent tubes to the town dump. Stop at the Elwood Farm on the return route to purchase fresh peaches, zucchini and corn; second stop at Sunnycrest Farm to PYO blueberries. Return, more gardening: We’re at the stage where the plants are about to go hog wild and completely overtake everything in the yard.

Finally, today is Final Exams for the pugz. The Challenge Question: Can they walk by those delicious treats, at nose level, with simply a “Leave it.”command? Their Therapy Dog and AKC Community Canine Titles are dependent on it!

Earnings and the Market[1]

[Click on the company name of the story and on the stock symbol for the stock chart]

The AAII[2] poll that we sited last week, with dramatically increasing bearishness retracted it’s sentiment dramatically, moving from 38 percent down to 27 percent. However, this week’s rebound in the market is on low volume, so It’s difficult to subscribe huge meaning to the up draft.

JC Penney (JCP: NYSE) reported a narrower than expected second quarter loss, with sales increasing six percent and online sales up nearly 17 percent. Sales have now increased for three quarters in a row. The loss was $70m as opposed to $395m YoY.

Nordstrom (JWN: NYSE) on the other hand, not so good. Net sales were $3.3b and earnings at $0.95 per share, as opposed to $3.1b and $0.93 YoY. It’s all in the expectations, and Nordstrom had guided higher than $3.3b and $0.95 per share. Crash . . . down to earth.

Cisco, (CSCO: NYSE) the networking giant, did a swoon. Revenues came in at $11.2b and $0.27 per share vs. $12.1b and $0.59 per share YoY. Not a great time to be a Cisco employee, especially with a six percent headcount cut looming. It’s always been an exciting, and somewhat vicious place to work. By and large, my friends who have worked at Cisco are incredibly smart and driven, and they have done well on the stock side of life. But, it is a tough environment: a tight ship, without much coddling of employees.

On the business front, lots of product transitions ahead. John Chambers has stated that they have “embraced”the concept of the Software Defined Network (“SDN”)[3], but it does leave a lot of questions. If you read their quarterly news release, you will see Cisco is aggressive on the acquisition front, in all the right strategic areas. Implementing: that’s always tougher. Especially when you’re the 32 ton gorilla.

Rackspace Hosting (RAX: NYSE) posted results of $0.16 per share on $441m in revenue, as opposed to $375m and $0.16. Rackspace serves the cloud, so is a bellwether stock, in that regard.

IPOs[4]

(1 IPO’s)

Please double click on the Company Name for the S-1, and on the Company Symbol for the stock trading chart. 

It is August, and a rocky time in the market, so little on the IPO front.

Otonomy (OTIC: Nasdaq) sold 6.3m shares at $16 per share, raising $100.8m at a valuation of $311m. The stock closed the week at $16.18 per share.

We are a clinical-stage biopharmaceutical company focused on the development and commercialization of innovative therapeutics for the treatment of diseases and disorders of the ear. To overcome many of the limitations of delivering drugs to the middle and inner ear, we have developed a proprietary technology that is designed to deliver drug that is retained in the ear for an extended period of time following a single local administration, which we refer to as “sustained-exposure.”Utilizing this technology, we have advanced three product candidates into development. Our lead product candidate, AuriPro, is a sustained-exposure antibiotic for which we have recently completed two identical Phase 3 clinical trials in 532 pediatric patients with middle ear effusion, or fluid, at the time of tympanostomy tube placement, or TTP, surgery.

Mergers & Acquisitions[5]

(6 transactions)

Click on the highlighted text for more deal information. 

Video streaming and analytics provider, Ooyala is being acquired by Telstra for $270m. Telstra had made a $43m investment in Ooyala in 2013.

SalesLogix is being acquired by Infor.com boost their cloud-based CRM suite.

Controversial Ask.fm is being acquired by Ask.com, the parent company. As part of the deal, the founding brothers are exiting the company.

itDuzzit, the fastest way to sync data between cloud applications, is being acquired by Intuit.

Zofari , which builds “discovery”experiences at scale, is being acquired by Yahoo!

Singapore

Singapore games studio, Nonstop Games, is being acquired by King.com, maker of Candy Crush.

Private Placements[6]

[22 transactions]

News-Media

Buzzfeed, a social news and entertainment platform, raised a $50m Series E round.

Wellness

Athos, which is to produce workout clothes that talk to your smart phone, raised a $12m Series B round.

Bravo Wellness, which creates wellness solutions for organizations, raised a $22m Series A round.

Marketing

Tobii Technology, a leader in eye tracking and gaze interaction, raised a $15m Series D round.

Marketing intelligence company, Everstring, raised a $12m Series A round. “The big data startup uses machine-learning algorithms to weed out the good leads from the bad leads in a company’s marketing database.[7]

Software

Lookout, which has developed a security platform for mobile devices, raised a $150m Series F round.

Luminal , a cloud-based startup developing next generation solutions for the operations and maintenance of cloud­-based applications, raised a $109m Series B round.

famo.us, the only JavaScript framework that includes an open source 3D layout engine fully integrated with a 3D physics animation engine that can render to DOM, Canvas, or WebGL, raised a $20m Series B round.

Electric Imp, which has created a service platform to connect devices to the internet, raised a $15m Series B round.

Pittsburgh-based, Hireology, that has developed an applications software platform that helps you hire the most appropriate people for your business, raised a $10m Series B round.

Finance

Axial, a New York-based company that helps link private companies to sources of capital with a software platform, raised an $11m Series B round.

Transportation

RelayRides, a car rental service, where you rent your car to a stranger, raised a $10m Series B round.

Food

Colorado-baed, Nutrinsic, which is striving to use unused nutrients into a food source, raised a $13m Series C round.

Meal-kit startup, Plated, raised a $15m Series A round.

Camera-related

360fly, Inc. raised an $18m Series A round. 360fly has developed a camera that “users can capture videos and still pictures in 360-degree full panorama.[8]

Andover, Massachusetts-based, Immedia, a leading provider of video and image processing chips for connected camera applications, raised a $12m Series B round. Blink is a home security startup the company has on Kickstarter.

Argentina

Navent, which helps people find a job and a home, raised a $20m Series C round.

Canada

Desire2Learn, an integrated learning platform used in more than 1100 institutions and 20 different countries, raised an $85m Series B round.

China

Lamahui, a Chinese e-commerce platform, raised a $15m Series A round.

Germany

Berlin-based, FoodPanda/hellofood, raised a $60m Series D round. The Company has a take-away food delivery network in Europe and India.

Israel

GetTaxi,which operates in 25 cities, including New York, London, Moscow, St Petersburg, Jerusalem and Tel Aviv, raised a $25m Series D round.

United Kingdom

Mobile car payment app, SumUp, raised a $13m Series C round.

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All the best,

 

Margaret Johns

Founder & Chairman

Affiliates:

SiVal_LogoJan Robertson

SiVal Advisors, LLC

 

 

 

 

 

 

Bic Stevens

Stevens Capital Advisors

 

Chartworth2Chartworth

Susan Woods and Vlad Harris

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Margaret Johns is the Founder and Chairman of BlueLake Partners, a boutique M&A investment bank based in the Greater Boston Area. Prior to founding BlueLake she was an employee founder and Managing Director at Needham & Company where she worked in Corporate Finance in New York City and headed up its Boston office. She now lives in Londonderry, New Hampshire with her husband, 16 year old step-daughter and three pugs. When she’s not working with clients, FINRA or writing blogs she competes on the Granite State Penguins Masters Swim Team, skis, rides her bike or is out walking her pugs.

Content researched, edited and reviewed on a best efforts basis.

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We make no claim to being comprehensive in our review, as the contents are companies and topics we, ourselves, find of interest.

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This newsletter is currently being proofed by Dave Henshaw, which is much appreciated. Dave is my USMS swimming lane mate, and Granite State Penguin team-mate. He is retired from MIT, where he used to produce and proof their annual financial report. Exactly what we need.

[1] WSJ Morning Moneybeat

[2] American Association of Individual Investors

[3] WSJ http://blogs.wsj.com/cio/2014/08/13/cisco-ceo-says-company-embraces-software-defined-networking/

[4]Renaissance Capital

[5] TechCrunch and company websites

[6] TechCrunch and company websites

[7]GigaOm

[8]WSJ