PreIPO INTELLI™ Weekly Insights | Series 38
Friday, June 23rd, 2023 | Volume 1 Series 38 | Recent Funding Overview, Top Mergers and Acquisitions this Year, and how AI is impacting jobs so far.
Greetings and Happy Friday to all! As yet another week swiftly passes, we are thrilled to present the latest batch of news and updates through the esteemed INTELLI™ Newsletter. In this edition, we cover recent startup funding, major mergers and acquisitions in 2023, and the impact of AI on jobs.
Recent Funding Recap 🔎
EvaluAgent - $20 Million Series A
EvaluAgent, a company founded by three friends with experience in the customer experience industry, has developed quality assurance testing software for contact centers. Their platform aims to help quality assurance staff analyze and coach customer agents across various channels. EvaluAgent provides automated workflows, a dedicated feedback tool for managers, and a built-in company knowledge base for employees. They also offer an automated scoring system called SmartScore, which utilizes speech recognition technologies and AI chatbots to transcribe conversations, provide insights, and offer coaching tips. The company has experienced significant revenue growth and recently closed a Series A funding round of $20 million led by PeakSpan. The funding will be used to enhance their products, expand the team, and support customers in new and existing markets.
Acryl Data - $21 Million Series A
Acryl Data provides tools to help companies organize and manage their data effectively. Their platform, built on the open-source framework DataHub, offers a community-driven metadata platform with solutions for data discovery, governance, lineage, and observability. Acryl's approach differentiates itself by operating on event-driven metadata, reducing the cost of data catalog maintenance and enabling trigger-based workflows. They also offer an observability module called Observe, which monitors data quality in real-time. Acryl plans to incorporate AI features for intelligent curation of metadata and generate summaries describing the characteristics of a data catalog. The startup's customers include Notion, Zendesk, Robinhood, OVO Energy, BetterUp, and Riskified. With the funding, Acryl aims to enhance its platform and increase productivity for data teams, providing a central resource for addressing data-related questions and reducing resolution time for data issues.
System Initiative - $15 Million Series A
System Initiative, aims to reimagine the DevOps toolchain by providing a platform that allows DevOps teams to build simulations of their infrastructure and quickly update production environments. The company has raised a total of $18 million, including a $3 million seed round led by Amplify Partners and a $15 million Series A round led by Scale Venture Partners. System Initiative plans to open source many of its core tools. The current DevOps implementations often fall short of delivering the desired agility, reliability, and security, leaving organizations stuck in a mediocre middle ground. System Initiative believes that a rebuild of the DevOps process, rather than patching together various tools, is necessary to improve outcomes and practitioners' lives. The platform offers a multiuser visual interface where infrastructure engineers can create digital twins to model production systems and test configurations. The tool then generates the necessary code to deploy these configurations into production. The aim is to enhance the user experience of doing DevOps work and foster a new wave of DevOps tools that can unlock the full potential of the industry.
🤝 Largest Mergers and Acquisitions so far in 2023
Despite the instability in the M&A market in 2023, there have been significant deals across various industries. The top M&A deals of the year include:
1. Amgen acquisition of Horizon Therapeutics:
Amgen, a biopharmaceutical company, acquired Horizon Therapeutics for $26 billion. This deal positions Amgen as a major player in the biopharmaceutical industry and allows them to tap into Horizon's portfolio in inflammation and nephrology. Amgen aims to leverage its global reach and commercial expertise to maximize the growth potential of Horizon's rare autoimmune and inflammatory disease treatments.
2. Johnson & Johnson's acquisition of Abiomed Inc.:
Johnson & Johnson, a leading healthcare products company, announced the acquisition of Abiomed Inc. for $18.04 billion. Abiomed is a world leader in heart, lung, and kidney support technologies. By acquiring Abiomed, Johnson & Johnson aims to enhance its position in the cardiovascular space and address unmet medical needs in heart failure and recovery. The deal offers growth opportunities for Johnson & Johnson and was well-received by investors, resulting in a spike in the company's stock price.
3. Japan Industrial Partners Inc., Suzuki Motor Corp., and ROHM Co. Ltd.'s acquisition of Toshiba Corporation:
Toshiba's board has approved a 2 trillion yen ($15.3 billion) buyout led by Japan Industrial Partners (JIP), paving the way for the troubled industrial group to go private. The tender offer of 4,620 yen per share requires at least two-thirds of outstanding shares to be tendered for the bid to succeed. If successful, Toshiba would later delist from the Tokyo Stock Exchange. The decision is seen as a milestone in Toshiba's turnaround efforts and aims to improve decision-making by having a single owner. The consortium, led by JIP, will now undergo antitrust and regulatory reviews before the tender offer begins in late July. The offer price represents a 10% premium over Thursday's closing share price. The buyout involves JIP, 17 Japanese companies, and six domestic financial institutions, as well as foreign investors. Going private has become the main option for Toshiba's restructuring after previous attempts, including a takeover bid by CVC Capital Partners, fell through.
4. Thoma Bravo's acquisition of Coupa Software:
Thoma Bravo, a private equity firm, acquired Coupa Software for $8 billion in an all-cash transaction. Coupa Software is a cloud-based business software company. The acquisition offers Coupa Software access to Thoma Bravo's resources, accelerating its vision to transform the office of the CFO. Coupa Software's management team considered continuing as a standalone business but ultimately decided that accepting Thoma Bravo's offer would provide greater opportunities for growth and transformation.
5. L3Harris acquisition of Aerojet Rocketdyne:
L3Harris, a global aerospace and defense technology innovator, agreed to acquire Aerojet Rocketdyne for $4.7 billion. Aerojet Rocketdyne is a manufacturer of rocket engines and propulsion systems for space vehicles and military tactical weapons. The acquisition will enhance L3Harris' capabilities in the aerospace and defense industry. L3Harris executives have engaged in discussions with Pentagon officials to address any concerns about the acquisition's impact on defense programs. The deal aims to achieve cost savings in operations, estimated to be around $50 million.
These notable M&A deals of 2023 demonstrate companies' strategic efforts to optimize their portfolios, drive growth, and adapt to the evolving market conditions within their respective industries.
🧠 AI not killing jobs yet
Amidst remarkable advancements in synthetic intelligence, concerns about job security have surged. Google searches for "is my job safe?" have doubled as people fear being replaced by large language models (LLMs). Research suggests that the introduction of LLMs could impact around 80% of the US workforce, particularly in industries like law, accounting, and travel.
Economists, however, have a tendency to make predictions about automation without thoroughly testing them. Previous predictions of job losses due to robots have been disproven by rising employment rates in technologically advanced countries like Japan, Singapore, and South Korea.
To analyze the impact of AI on jobs, a focus is placed on white-collar workers. While there is currently little evidence of AI causing significant job losses, the share of employment in professions at risk from generative AI has increased slightly over the past year. It is still early in the adoption of generative AI, so the full impact on jobs may be delayed.
Moreover, AI can also have a positive effect on jobs by increasing efficiency and potentially leading to increased hiring. Some employers anticipate a positive impact on their headcount as AI technologies become more prevalent.
Updates will be provided to track the evolving impact of AI on jobs.
🌐 Exciting Partnership Update!
Following our recent announcement of a strategic partnership with the top-rated US agency Jafton.com, we are thrilled to share an expansive plan that will fully integrate AI into our operations and services, setting a new industry standard in private equity investing.
At PreIPO.com, we already leverage AI to streamline processes and improve investment decision-making. Our platform harnesses Machine Learning (ML) algorithms for comprehensive due diligence, automating the extraction and analysis of financial records, market trends, and industry benchmarks. Additionally, we employ AI-driven models for dynamic real-time analysis and valuation of companies preparing for IPOs.
"We're enthusiastic about leveraging the power of AI to make pre-IPO investing more efficient and effective," said David Grzan, CEO of PreIPO.com. "Our partnership with Jafton.com, and the subsequent launch of PreIPO Labs and AI-infusion-as-a-service, opens up tremendous possibilities for our platform and our users."
Over the next six months, we will enhance our current AI capabilities, aiming for more precise risk assessments and valuation models, full automation of critical processes, and an improved personalized user experience. Our plan also includes the launch of advanced AI-powered chatbots to provide 24/7 support and guidance.
While we proactively leverage AI technology, we fully acknowledge the challenges it presents. Data privacy and security are of paramount importance, and we emphasize our commitment to ensuring appropriate anonymization and protection of data. We also recognize the significance of regulatory compliance and plan to closely collaborate with regulators to navigate the evolving landscape.
Moreover, we are cognizant of potential biases in AI algorithms and remain committed to addressing this issue, ensuring fairness in valuations and risk assessments. Despite the many advantages of AI, we reiterate the importance of balancing AI tools with human judgment and intuition, reducing overdependence.
Our partnership represents a fusion of finance and technology, aimed at making the journey to IPO as smooth and successful as possible for companies. Together with Jafton.com, we are excited to build a future where technology and finance go hand-in-hand, driving innovation and growth for businesses around the world.
Stay tuned for more exciting updates as we embark on this transformative journey together!
As always, stay tuned for more updates and insights from the team at INTELLI™.