BLP’s Rearview Mirror for the Week Ending November 24th: Earnings, IPOs, M&A and Private Placements

What’s Happenin’?

Week Ending November 24th

snow treesWe, and our neighbors, are officially battening down the hatches, preparing for winter.  The gutters are cleaned, the last of the leaves have been vacuumed from the grounds, and it’s time to switch the tractor attachment from the Cyclone Rake to the snow blower.  Just in time for today’s first snowfall of the year, which totaled all of one inch.

Gaggles of turkeys—twenty at a time—have been wandering around on our grounds and the neighborhood.  I’ve attempted to turn the pugs into hunting dogs, to no avail, so we’ll have to fetch our Thanksgiving turkey from Hannaford, again, this year.

Earnings

Best Buy (BBY:  NYSE) reported a return to profitability for the third fiscal quarter, exceeding expectations.  Sales were $9.36 billion, and profits were $54 million.  However, the celebration was short-lived, as the Company expects margins will take a hit this quarter in the current promotion oriented environment.

 

Gap (GPS:  NYSE) grew profits 9.4% to $337m or $0.72 per share.  Net sales rose 3.1 percent to  $3.98 billion.  Growth came from overseas sales, principally in Europe.

 

Analog, mixed-signal, DSP and ARM chipmaker Marvell (MRVL: Nasdaq) had profits almost double to $103.2m from $68.8m a year ago.  Revenues rose 19 percent to $931m.

 

Pandora Media (P:  NYSE) swung to a loss of $1.7m or  $0.01 from a profit of $0.01 a year ago—in other words, unchanged.  Sales grew 50 percent to $181.6m, but so did marketing expenses.  However, the stock still fell.

 

Salesforce.com (CRM:  NYSE) had revenue of $1.08 billion, an increase of 36 percent, and a loss of $124 million or $0.21 per share.  The growth was due in part to its acquisition of ExactTarget, which focuses on targeted digital marketing communications.

IPOs[1]

Technology

500.com (WBAI: NYSE), an on-line sports lottery based in Shenzhen, China, sold 5.8m ADS shares at $13 per share, raising $75m at a valuation of $419 million.  The stock closed the week at $20.01 per share.

Sungy Mobile (GOMO:  Nasdaq) 7 million shares at $11.22 per share, raising $78.5m at a valuation of $364 million.  The stock closed the week at $13.64 per share.  Sungy Mobile is an Android app developer of the GO series of apps, and is headquartered in Guangzhou, China.

Consumer

Vince aka Apparel Holding Corp. (VNCE:  NYSE) sold 10 million shares at $20 per share, raising $200m at a valuation of $724m.  The stock closed the week at $28.66 per share.  Vince is a high end retailer, that until today, I’ve never heard of.  Stores are principally in upper end localities in California, New York City and Connecticut.  If you are female and weigh more than 110 pounds, don’t even think about it.

Medical/Biotech

Israeli-based Evogene, (EVGN:  NYSE) which develops genetically enhanced seeds, sold 5 million shares at $14.75 per share, raising $73.75m.  The original pricing was $17.16 per share.  The valuation was $355m.  The Company closed the week at $16.74  per share.  My husband has been listening to documentaries on our food source, including GMO foods.  While I’m pretty conservative, and not given to alarm, there’s a lot of smoke around these products.  The stuff can have some pretty scary attributes so to the extent possible, we’ll attempt to steer clear.

Oxford Immunotec (OXFD: Nasdaq) sold 5.4m shares at $12 per share, below the $13 to $15 per share range, raising $64.8m at a valuation of  $906  million.  The stock closed the week at $15.4 per share.  The Company offers an FDA approved tuberculosis test for the detection of TB infection.

Mergers & Acquisitions

Tier 3 was acquired by CenturyLink (CTL:  NYSE)to build out its cloud, for $200m.  “Tier 3 brings enterprise-friendly management, a well-regarded Infrastructure as a Service (“IaaS”) and a Platform as a Service (“PaaS”) with it to CenturyLink, becoming the new CenturyLink Cloud.”[2]

Raidcall, a tool that allows you to communicate with groups of people, was acquired by ChangYou (CYOU:  Nasdaq), a Chinese on-line game company, for $50m.  ChangYou’s titles includes GameFuse, Renaissance Heroes and Sword Girls.

Biggs-Gilmore, a full service marketing/advertising firm specializing in branding, was acquired by VML for $21m.  Biggs-Gilmore is located in Kalamazoo, MI and Chicago.  VML is one of the world’s leading digital marketing agencies, located in Australia and London.  Check out the Biggs-Gilmore website—it’s very creative.

Legacy Locker, which is a way to guarantee access to your online accounts for those you want to receive them [should something happen to you] was acquired  by PasswordBox, a “digital life manager.”

ShareYourCart, a WordPress plug-in, was acquired by AddShoppers, which helps you make your store social.  ShareYourCart enables you to share your purchases with your Twitter and Facebook friends.

Techbargains, a technology product shoping guide, complete with coupons and product deals, was acquired by Ziff Davis.

WeHostels, a mobile app that helps on book hostels, was acquired by StudentUniverse.  I met the StudentUniverse people at a NorthEastern venture fair, organized by a former client, Bob Lentz, who is an EIR at NorthEastern’s Center for Entrepreneurship Education.  StudentUniverse is impressive and fast running.

Private Placements

Spotify raised $250m at a valuation of over $4 billion.[3]  Spotify is almost $600m in revenues and is available in 32 countries.

SimpliVity has raised a $58m Series C round.  SimpliVity developed “OmniCube,” their technology, powers a new assimilated, IT infrastructure platform.   They claim to have created a platform that includes all the buzzwords:  storage deduplication, cloud integration, backup deduplication, global scale out . . . and on and on and on.

Compass-EOS raised a $42m venture round.  The Company claims to be introducing a new, photonics based technology, including the world’s first optical chip-to-chip interconnect, that results in a higher-speed router with a smaller footprint and lower power requirements.

Aria Systems, which provides enterprise cloud-based subscription billing solutions, raised a $40m Series D round.

LYTRO, the innovative light field camera, raised a $40m Series B round.  LYTTRO is the infamous digital camera.

Hightail raised $34m Series E round.   Hightail is an app for online file sharing and storage.  The Company claims it’s systems lets you send files securely, collaborate, and access your work from anywhere.

Apprenda, an Enterprise Private PaaS raised a $16m Series C round.  Apprenda is based in Clifton, NY.

Two year old ApartmentList, an apartment search engine, raised a $15m Series A round.  They appear to  have apartments throughout the country, including an interesting selection in Southern New Hampshire.

Talari Networks raised a $15m Series D round.  Talari is about Adaptive Private Networking technology for WANs.

Canadian consumer lending platform, Financeit, raised a $13m Series A round.  The system creates and manages loans from the point of sale.

Sittercity, a service that puts families and caregivers together, raised a $13m Series C round.

Yub, a loyalty reward app, raised a $12m startup round.

Manhattan-based littleBits Electronics, a type of electronics LEGO kit company, raised an $11m Series B round.

Acumatica raised a $10 Series C round.  The Company is founded by ERP veterans, targers SMB customers, and is cloud based.  Products include financial, distribution management, CRM and project accounting.

TapCommerce, a leader in “mobile ad retargeting” raised a $10m Series A round.

Signpost, a New York City marketing company, raised a $10m Series B round.  The Company claims to be able to feature your business on every site and mobile app “that matters,” including Bing, Yahoo!, Yelp and more.Turkey

Over Thanksgiving week, we aren’t expecting much activity or news, so we will meet up with you again the week

after Thanksgiving.

Bundle up, and have a great Thanksgiving with your friends and loved ones.

All the best,

Margaret Johns

Founder & Chairman

 

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

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

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] Certain information provided by Renaissance Capital, in addition to the SEC and numerous business publications

[2] GigaOm 11-19-13

[3]WSJ 11-21-13