Monday, January 18, 2016

Another Day, Another Down Round: Jawbone

It's valuation was up to $3.3 Bil. so down 54%.
But Still a Unicorn!
From re/code, Jan. 15:

Jawbone Gets $165 Million in Complex Down Round, as Sameer Samat Heads Back to Google
Jawbone, the San Francisco maker of activity trackers that has seen numerous ups and downs in its short history, has raised $165 million in new funding (up), even as its relatively new president Sameer Samat is leaving to rejoin Google (down).

A spokesperson confirmed the funding and departure when called by Re/code for comment.
Google also confirmed the hire. “We’re thrilled to welcome Sameer back home,” said a spokesperson. “He’s a talented executive who will be a perfect match for Google Play, an exciting and rapidly growing area for us.”

According to sources, the new investment is largely coming from the Kuwait Investment Authority in an all-equity deal (up). But it drops the valuation of the company by half to $1.5 billion (down) — ironically, its valuation in 2011.

The restructuring of the cap table — which is what this is, diluting investors not participating in the new round (down) — has an unusual twist in it. Despite a lower valuation, a larger pool of equity for employees has apparently eliminated losses in value of their shares (up).

You get the idea here.

The protection of employee stock is important at this juncture for Jawbone, but also for many other public and private tech companies that have seen their values decline recently after years of ever-escalating valuations.

So far, Jawbone has raised $1 billion, with a valuation as high as over $3 billion in previous transactions, which had all kinds of complex financial structures and liquidation preferences that gave some investors more value than others....MORE
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