Favor delivery runners hanging out (courtesy image)
Austin was on a roll in September when it comes to venture capital activity.
The year's largest funding round arrived -- a $40 million Series B for The Zebra, a Mark Cuban-backed startup that is like KAYAK for comparing auto insurance policies and prices.
Meanwhile, former Austin Ventures General Partner Chris Pacitti launched a new VC firm called Elsewhere Partners that seeks to make growth equity investments in revenue-generating software startups outside of Silicon Valley and Boston.
Then, Next Coast Ventures, which closed an $85 million round to fuel startups earlier this year, announced it has expanded its team to include venture partners Jim Dunham, the former president of cloud and business intelligence at San Francisco’s ServiceSource, and Paul Rogers, CTO of New York-based Namely Inc. and former CTO of RetailMeNot Inc.
If that weren't enough, the Central Texas Angel Network released a new report showing it has set a new record for the amount of money it has invested in startups in half a year -- $7.6 million into 31 startups. That means CTAN, which is the most active angel network in the nation, is on track for its biggest year ever.
Now, here's a look at all the funding events from September.
Angel Investments, Venture Capital and Private Equity Fundings
- Central Texas Angel Network led a $1 million seed round for Colorado-based Neuraptive Therapeutics, Inc. New Rhein Healthcare Investors LLC and several angel investors were also in on the round. Neuraptive makes the AxoFuse, a therapeutic kit used to repair nerves after surgery.
- Favor, the Austin-based on-demand delivery startup, closed a $22 million Series B funding round to continue its expansion in Texas and on-board 25,000 more independent contractors to make deliveries. The new funding, led by Austin’s S3 Ventures, came as the company announced it has become profitable, a rare achievement in the on-demand delivery space which is largely fueled by massive infusions of venture capital. (Read more)
- Kasita, the smart tiny home startup, has previously mentioned it had raised funding in the neighborhood of $10 million. In an update to its Crunchbase page, we can now see the company, led by Jeff Wilson, has raised $11.5 million thus far. And, more interesting than that, we can see who one of Kasita’s seed investors was — Gary Keller, the founder of Keller Williams, the world’s largest real estate firm, which is also based in Austin. It looks like this is a direct angel investment from Keller (not out of Keller Williams’ new $1 billion innovation fund).
- BeatBox Beverages, which makes wine-based cocktails, closed a $4.7 million Series A round of financing. Entrepreneurs Matthew Meehan and Rod Hildebrant were the lead investors. Other investors included MTV "Ridiculousness" host Rob Dyrdek, Mark Cuban Companies COO Jeff Cuban, former Deep Eddy Vodka sales executive John Potts and FlockU CEO Josh Verne.
- TrustRadius, an Austin-based software reviews startup, reported raising $5.5 million in new equity funding, an SEC filing showed. The round was led by Austin's LiveOak Venture Partners. TrustRadius, led by founder and CEO Vinay Bhagat, previously raised a $5 million round in 2013 and a $2.1 million round in 2016, federal filings show. Mayfield Fund, which is based in Menlo Park, led the 2013 Series A round.
- Liveoak Technologies, an Austin fintech startup, announced it raised $2.5 million in new equity funding led by Broadhaven Capital Partners and WildBasin Investments. Meanwhile, the company announced new partnerships and investment from Manulife (known as John Hancock), Northwestern Mutual Future Ventures and Prudential’s Gibraltar Ventures. Other investors include Techstars Venture Capital Fund, MATH Venture Partners, Zelkova Ventures, and Glenn Shimkus, founder of Cartavi.
- Buzz Points Inc., an Austin-based rewards platform for local businesses and consumers, raised $3.7 million in new debt funding, an SEC filing shows. That follows a $2.9 million round of equity funding in early August, and it follows news in May that the startup had formed partnerships with 14 community credit unions and other financial institutions.
- Austin Ventures is poised to get some ROI. One of its investments from nearly a decade ago, San Diego-based Slacker Radio, is being acquired by LiveXLive. Financial terms weren’t disclosed.
- VUV Analytics, a Cedar Park-based material analytics startup, raised a $2.2 million round of new equity funding, an SEC filing shows. The company uses vacuum ultraviolet absorption spectroscopy to help companies analyze pharmaceuticals, gases and other materials and gases. The company previously reported raising $3.5 million in 2014 and $2 million in 2016.
- Mighty Swell Sparkling Cocktails, an Austin-based canned cocktail startup, reported raising a $12.8 million round of equity funding, per this new SEC filing. The company was founded by Clayton Christopher, co-founder of Sweet Leaf Tea and Deep Eddy Vodka; Daniel Barnes, founder and CEO of Treaty Oak Brewing and Distilling Company; and Sean Cusack, an investment professional who worked with Goldman Sachs and UBS. Jason Bronstad, a former executive at Mike’s Hard Lemonade, is president at Mighty Swell. No word yet on where the funding comes from — the filing indicates 57 unnamed investors were in on the round. But CAVUVenture Partners, where Christopher is a co-founder, lists Mighty Swell in its portfolio.
- Per an SEC Filing, Olono, formerly Nexd, closed a $4 million seed round. Olono, which bills itself as “your personal sales sidekick,” is building a proactive enterprise sales tool.
- Iris Plans announced a new $5.1 million infusion of equity capital led by Austin's LiveOak Venture Partners and New York City-based Activated Venture Partners, which has a variety of medtech investments in its portfolio. Iris Plans uses a videoconferencing platform and a network of advanced care planning professionals to help guide patients and their families through end-of-life planning, a move that can save money, confusion and stress when done properly.
- Shipwell, Inc., which makes a platform for freight shipping, raised $2 million in equity funding, per this SEC filing.
- The Zebra, an Austin-based insurance comparison startup, pulled in the biggest venture capital funding round of any local startup so far this year. Palo Alto-based Accel Partners led its $40 million Series B. The Zebra’s original CEO and co-founder, Adam Lyons, will become the startup’s chairman after they hired former KAYAK President Keith Melnick to take the lead executive role. The Zebra has raised $61.5 million since its founding in 2012.
Acquisitions
- Newgistics, an Austin shipping and digital commerce startup, agreed to be acquired by Pitney Bowes (NYSE:PBI), a global tech company, for $475 million. The deal is expected to close by early Q4. Pitney Bowes said it wants to keep Newgistics operating independently through Q1 of 2018 to avoid disruptions over the holidays. Newgistics, founded in 1999, raised about $26 million between 2000 and 2013, Crunchbase shows. It flirted with an IPO in 2011, filing to raise about $86 million. But it backed off the idea. Its biggest investor, at that time, was Austin Ventures. Other investors include Littlejohn & Co. LLC,Spiegel-Hermes General Service LLC, R.R. Donnelley & Sons Company and AV Labs.
- Rackspace, the San Antonio-based managed cloud computing company that was acquired by Apollo Global Management last year, says it is acquiring Jersey City-based Datapipe Inc. No word on the price point. Datapipe has raised about $311 million from investors (its majority owner is Abry Partners in Boston), and it has 825 employees around the globe. That will bring Rackspace’s headcount to 6,700, the ABJ reported. Roughly 650 work in Rackspace’s Austin offices.
- Zebra Imaging Inc. has been pioneering for more than a decade. In late September, the company announced it has finalized the sale of its 3D Holographic Imagers and print business to HoloTech Switzerland Ag, a European print company with offices in Switzerland and Hungary. No financial details were provided.
- Personify Inc., an Austin startup that makes software to help membership-based organizations manage and engage with members, has acquired Toronto-based Wild Apricot, a membership management software company. Financial terms weren’t disclosed. As part of the deal, Wild Apricot will remain its own brand. The combined company will have just under 300 full-time employees.
