PreIPO INTELLI™ Weekly Insights | Series 45
Friday, August 18th 2023 | Volume 1 Series 45 | Better.com SPAC Merger, PreIPO-Nivriti Partnership, and More Funding Updates
Hello everyone, as we approach the end of the week, the INTELLI™ team is pleased to share a series of new updates to keep you informed. This week we will talk about Better.com going public via a SPAC merger with Aurora Acquisition Corp., after securing a substantial investment from SoftBank. PreIPO partnering with Nivriti Solutions Global to initiate a $25 million capital raise.
Fintech Startup Better.com going public 🌐
Better.com, the digital mortgage lender, has received shareholder approval for its proposal to merge with Aurora Acquisition Corp. through a SPAC arrangement. The confirmation was announced today. As per an official filing with the Securities and Exchange Commission (SEC), Better.com is set to combine with Aurora, effectively going public, around August 22, 2023.
Upon completion of the transaction, the combined entity will gain an infusion of a minimum of $550 million in new capital from SoftBank, as per Aurora's filing with the SEC in July. An additional $200 million could also be received. If Novator, an investment firm associated with Aurora, exercises its $100 million option, SoftBank is obligated to match that amount. In late November 2021, it was reported that Aurora Acquisition Corp. and SoftBank amended their financing agreement to promptly provide Better with half of the committed $1.5 billion instead of waiting for the deal's closure.
Better.com initially started its journey towards going public through a $6 billion SPAC in May 2021. Later, the valuation of the deal reached $7.7 billion. However, events took a negative turn, leading to delays in the SPAC process later that year.
Over the past couple of years, Better.com has faced numerous challenges, including layoffs, prominent executive departures, a slowdown in the housing market, and unfavorable media coverage. This series of events had industry experts skeptical about the feasibility of the company's plans to go public. Despite lackluster performances in the blank-check combination sector in previous quarters, Better.com declared its intention to proceed with its public debut last year. The company had faced its fair share of challenges since announcing its SPAC merger plans, including botched layoffs and shifts in market conditions that affected various aspects of its business, such as a rise in mortgage interest rates.
Notably, the SEC indicated last week that it did not plan to recommend any enforcement actions against Better.com after conducting an investigation to determine if federal securities law violations had occurred. The investigation had begun in July of the previous year, with the SEC requesting documentation from both Better.com and its SPAC partner, Aurora Acquisition Corp., regarding their business activities.
In June, the fintech startup underwent a substantial change by shifting from an in-house agent model to a partnership agent model, leading to layoffs in its real estate team. The company continues to experience financial difficulties.
Reports from HousingWire indicate that Better.com posted a net loss of $89.9 million in Q1 2023 and reduced its workforce by around 91% over an 18-month period. While there appears to be some improvement compared to a net loss of $327.7 million in the first quarter of 2022, Better.com is still grappling with challenges.
Nivriti Solutions Global and PreIPO.com join forces to commence a capital raise of $25 million
We are excited to share news of a collaborative alliance between PreIPO.com and Nivriti Solutions Global. PreIPO specializes in partnering with dynamic privately-held firms on the brink of going public. Our joint venture with Nivriti is a testament to our trust in their innovative solutions for managing supply chain assets.
Nivriti Solutions Global holds a prominent position in the field of supply chain management. Leveraging cutting-edge technology, they offer a suite of supply chain management solutions through their NSaaS™ platform. This platform equips users with tools to efficiently oversee, assess, and optimize their supply chains and fleets.
This partnership opens doors for investors keen on technology-oriented enterprises displaying potential in their respective industries. Our collaboration with Nivriti Solutions Global perfectly aligns with our commitment to endorsing companies that employ modern technology to tackle intricate business challenges.
Nivriti Solutions Global aims to utilize the potential funds generated from this partnership to enhance their offerings. This includes expanding their range of IoT devices and cloud-based platforms. Additionally, they plan to refine their reporting processes from raw material procurement to final product delivery, further reinforcing their mission to optimize supply chain and fleet management across diverse sectors.
For followers of PreIPO, this association with Nivriti Solutions Global is noteworthy as it complements our portfolio of exciting enterprises. This partnership extends promising opportunities for early investors in Nivriti, an innovative supply chain asset management entity.
Will Instacart IPO this year?
As indicated by Bloomberg, it is possible that Instacart might make its IPO intentions public in the upcoming week. The report mentions that the grocery-delivery company is planning a conventional IPO on the Nasdaq, which is a shift from its previous contemplation of a direct listing.
When contacted on Thursday, an Instacart representative chose not to provide any comments.
Instacart, headquartered in San Francisco, has been generating significant anticipation for its initial public offering for several years. In the previous year, it discreetly filed for its public debut; however, it postponed the offering in October, reportedly citing unfavorable market conditions.
Earlier in the present year, Instacart raised its valuation by 18%, reaching approximately $12 billion, as reported by The Information. This occurred after the company had lowered its valuation multiple times in 2022, initially being valued at $24 billion.
While this year's IPO market hasn't reached the exuberant levels of the pre-pandemic era, it is considerably more favorable than the almost stagnant conditions of 2022. Instacart's entry into the market could serve as an optimistic indicator of a revival. The Renaissance IPO exchange-traded fund (IPO) has shown a 30% increase year to date, while the S&P 500 (SPX) has gained 14%.
Recent Funding Recap 🤝
Chargeflow - $11 Million seed round
Chargeflow, a startup using AI to counter chargeback fraud, has secured $11 million in a seed funding round led by OpenView Venture Partners. This adds to their previous $3 million seed funding, totaling $14 million raised.
Launched in 2021 by Israeli-American entrepreneurs Ariel and Avia Chen, Chargeflow tackles chargebacks using machine learning to create personalized "dispute evidence" for each case. They automate the submission process to banks and credit card companies.
Chargebacks are a growing concern, with 65% of merchants reporting increased fraud. Merchants lose around $34 for every $1 in chargebacks, a figure projected to rise to $193 by the end of 2023.
Chargeflow's solution matches disputes to order data, generating tailored dispute responses. Human experts review these before submission, eliminating the need for manual handling, which typically takes 1-2 hours per case.
Viome - $86.5 Million Series C
Research into the human microbiome, the communities of microorganisms living in parts of the body like the gut and mouth, has led to valuable insights and attracted interest in alternative medicine. This trend has driven significant funding into Viome, a startup analyzing customers' microbiomes using AI to offer personalized supplements and guidance. Viome has secured $86.5 million in a Series C funding round co-led by Khosla Ventures and Bold Capital, along with other investors. The company's RNA sequencing technology, developed from Los Alamos National Laboratory research, is clinically validated and exclusively licensed to Viome. The funding will support business expansion and new product lines, including dental health.
Viome, established in 2016, has served around 350,000 customers from 106 countries and collected over 600,000 samples for its algorithm. The company aims to tap into the growing interest in gut health by offering tailored vitamin supplements and guidance based on microbiome analysis. The recent funding will also help Viome introduce new product lines and establish retail partnerships, including a collaboration with CVS.
While Viome operates in the realm of alternative medicine, it also emphasizes its technological foundations. The company's RNA gene expression insights combined with AI-driven analysis have enabled personalized recommendations. Despite its progress, some experts question the claims Viome makes, with concerns about overselling the benefits of microbiome data analysis and treatment efficacy.
Caden - $15 Million Series A
As privacy-conscious consumers multiply, a wave of startups is emerging to let individuals capitalize on their data. Datacy, Pogo, and Tapestri offer ways for users to trade their data for rewards or sell it to the highest bidder. Caden, a new entrant, is distinguishing itself by providing users with granular controls over the data they share with third parties. Backed by Jerry Yang, co-founder of Yahoo, Caden aggregates analytics data on users' activities and lets them monetize it through various options.
Caden's founder, John Roa, cites the paradigm shift in online privacy and data access as inspiration for the platform. He envisions putting users at the center of data exchange and empowering them with control over their information. Caden's approach contrasts with privacy laws that focus on user consent and rights to opt out of data tracking and selling.
Caden's platform requires users to link their existing online services, such as Amazon and Netflix. The startup's iOS app allows users to view usage stats, insights, and ways to monetize specific data segments by sharing them with advertisers. Roa assures that Caden secures sensitive data in an encrypted vault and anonymizes it before sharing. Users can opt out of data sharing and delete their accounts.
Caden's success aligns with changes like Apple's app tracking permission policy and Google's planned user tracking restrictions. The company recently raised $15 million in a Series A funding round led by Nava Ventures, bringing its total funding to $24.4 million. The funds will support team expansion, further development of Caden AI, and building connections with retailers, loyalty programs, fitness platforms, and streaming services.
As always, stay tuned for more updates and insights from the team at INTELLI™.