Markit Heads to IPO Market, Wall Street BrokerDealers All Smiles

wsj logoBelow blog news extract courtesy of the Wall St. Journal.

One of the biggest financial service industry IPOs of the season (as well as any other industry initial public offering of the season) is scheduled to launch on Thursday, and, as noted by the WSJ, Wall Street’s biggest banks are in line for a payday of up to a billion dollars from Markit Ltd.’s share float, as they cash out part of their stakes in the financial-data firm and divvy up the underwriting fees.

The 12 financial institutions that rank among the London company’s top shareholders expect to raise as much as $1.02 billion selling shares Wednesday at as much as $25 apiece, a rare bit of good news at a time of sluggish revenue, soft trading activity and regulatory scrutiny. The largest sellers are expected to be Bank of America Corp. BAC 0.00% , Citigroup Inc. C +0.29% and Deutsche Bank AG DBK.XE +0.49% , with Bank of America selling seven million shares to raise up to $176 million, according to filings.

The firm’s largest holders—an employee-benefits trust, private-equity firm General Atlantic and Singapore state-owned investment company Temasek Holdings Pte Ltd.—aren’t selling their shares, according to regulatory filings. The Canada Pension Plan Investment Board is considering buying $450 million worth of the shares, the filings said.

The offering, which begins trading Thursday, could give the financial-information company a $4.5 billion market value, highlighting Markit’s evolution in the years since the financial crisis and investors’ thirst for data on derivatives, bonds, loans and foreign-exchange markets.

“Markit started with a great idea, which was to create a central pricing service in what were at the time very rapidly growing credit markets,” said Mark Beeston, a former board member and founder of financial-technology venture-capital firm Illuminate Financial Management.

At the same time, the banks that have backed Markit since its founding more than a decade ago have been jockeying for position in selling the offering to the public. The deal is expected to raise as much as $1.1 billion altogether.

The company and the banks are discussing a fee pool of about 4% on the IPO, which would amount to as much as $45 million if the deal is priced at the top of the range, people familiar with the matter said.

The banks skirmished over their roles as the IPO was in its planning stages, according to some of the people familiar with the matter.

For the full story, please click here to visit the WSJ.

Grocery Delivery Service Instacart Raises $44 Million update courtesy of extracts from today’s NYT DealBook.

Companies like Uber and Airbnb have prospered by allowing people to sell their services to strangers on a smartphone-powered network.

Now venture capitalists are betting that a young start-up can use that principle to achieve success in the grocery business.

Instacart, a two-year-old grocery delivery company, announced a $44 million round of financing on Monday led by Andreessen Horowitz. Three venture capital firms that previously invested in the company, Sequoia Capital, Khosla Ventures and Canaan Partners, participated in the latest round.


The company, which is based in San Francisco, lets customers shop online from grocery stores in their area. The orders are filled by other people who have signed up to be shoppers and who receive a cut of the delivery fees. Information about a store’s inventory comes from store managers and from the shoppers. The company says it can have groceries delivered within an hour.

Jeff Jordan, a partner at Andreessen Horowitz, said he was attracted to Instacart because it was a “people marketplace.” He said the company had an advantage over other grocery delivery services, including FreshDirect, because it did not rely on warehouses, trucks or other capital-intensive infrastructure.

“Grocery is the single largest category of retail in the United States and is virtually undigitized at this point,” Mr. Jordan said in an interview. “There is an enormous opportunity if someone can figure it out.”

The founder of Instacart, Apoorva Mehta, previously worked at Amazon in the “fulfillment” division, which oversees the delivery of orders from warehouses to customers. After starting in San Francisco, Instacart has expanded to 10 cities across the country, Mr. Mehta said.

The full article can be found at NYT DealBook.

UK-based Financial Technology Start-Up Scores With London Bankers update courtesy of extracts from today’s NYT DealBook

The British capital is staking a claim as a global leader for financial technology start-ups.

Andrew Testa for The New York TimesTransferWise, which offers foreign exchange transfers without large bank fees, is one of the companies making up London’s growing financial technology start-up scene.

Andrew Testa for The New York TimesTransferWise, which offers foreign exchange transfers without large bank fees, is one of the companies making up London’s growing financial technology start-up scene.

On Monday, TransferWise, one of the city’s most prominent financial technology companies, said it had raised $25 million from a range of investors, including Peter Thiel, a co-founder of PayPal, and the British billionaire Richard Branson.

Started by two Estonian friends in 2011, TransferWise uses peer-to-peer technology that allows individuals around the world to swap currencies without incurring large bank transfer fees.

The company says it has processed roughly 1 billion pounds, or $1.7 billion, of transactions over the last three years, saving its customers around £45 million in banking fees that would have been incurred when sending money to another country.

The London-based start-up, which in 2013 raised $6 million from investors, including from Mr. Thiel’s venture capital firm, Valar Ventures Management, offers foreign exchange transfers across Europe but has yet to break into the United States. (The company offers a limited product for dollar transactions that does not include using peer-to-peer technology to match customers in different countries.) The company’s largest markets are currently Britain, Germany and France.

The full article can be found at NYT DealBook.

GoDaddy to Tap Public Markets for IPO blog extends thanks to NYT DealBook for below news extract.

GoDaddy, the domain name registration giant, plans to sell its shares to investors in an initial public offering.

Courtesy of NYT DealBook

Courtesy of NYT DealBook

The company, which filed a prospectus with regulators on Monday, is preparing to tap the public markets about two-and-a-half years after it was bought by a group led by the private equity firms Kohlberg Kravis Roberts and Silver Lake. GoDaddy previously sought to go public in 2006, but a deal never materialized at that time.

GoDaddy allows individuals and small businesses to set up Internet domain names, offering services like website building, hosting and security. The company had 57 million domains under management as of Dec. 31. It generates the majority of what it calls bookings — gross sales before refunds — from sales of domain names.

K.K.R. and Silver Lake, along with the venture capital firm Technology Crossover Ventures, paid about $2.25 billion for GoDaddy in December 2011. The company plans to use some of the money raised in the I.P.O. to reduce its debt.

It also plans to make a $25 million payment to its private equity and venture capital owners, to terminate an agreement under which the owners have collected fees.

For the full story, please visit NYT DealBook article.

A Chinese Menu of Deals Drives Venture Capital Guru East; spotlight

Investing in China and sourcing private equity, venture capital and deal opportunities is getting better every day. blog extract is courtesy of New York Times Dealbook

SHANGHAI – James W. Breyer, the venture capitalist who made a fortune with an early bet on Facebook, is putting some of his winnings to work in China, partnering with Beijing-based venture capital firm to invest in Chinese technology start-ups.

IDG Capital Partners said on Wednesday that Mr. Breyer, a longtime partner at Accel Partners in Palo Alto, Calif., would advise and invest alongside a $586 million IDG fund that closed June 3. The fund is expected to make early stage investments in Chinese technology, media and telecommunication companies.

The announcement comes as interest soars in Chinese technology companies after two years of frenzied deal-making, much of it involving China’s Internet giants: Alibaba, Baidu and Tencent. Those three companies alone have spent more than $10 billion buying up start-ups and rivals during the last few years.

And with other technology highfliers here, including, the Chinese e-commerce company that recently raised $1.78 billion in its New York public listing, China has rapidly become a prime destination for the world’s biggest venture capital and private equity firms. Among the biggest and most active in China are Sequoia Capital, Qiming Ventures, SAIF Partners, IDG Capital Partners and Northern Light Venture Capital.