A glimmer of hope

May 19, 2020

Since the pandemic outbreak, headlines have been punctuated by company layoffs. The unemployment rate has climbed to historic levels not seen since the Great Depression. Even high-growth unicorns have announced drastic cost-cutting.

However, in looking at the 14.7% unemployment rate, it is easy to paint a simplified and bleak picture of the labor market and the state of businesses. Drilling down, there are bright spots behind that overarching unemployment number and evidence that growth could be restored once the hibernation known as Shelter In Place passes.

In April, the unemployment rate in computer occupations actually decreased to 2.8%, from 3% in January 2020. Moreover, from April 14th to May 13th, active job postings for computer-related jobs increased to 625,702. The tightness in the tech job market points to the fact that even for companies that have already announced layoff plans, tech-related jobs are as secure as ever at this point. Because tech jobs have been generally preserved, companies could enter growth mode fairly quickly when the economy reopens.

The race for a vaccine is heating up as more data emerge suggesting progress and the timelines and capacities for having an active, scalable vaccine accelerate. Of the 110 vaccine candidates under development, 8 are in clinical studies. According to Morgan Stanley, 6 (4 of the current clinical candidates and 2 preclinical) both have a reasonable likelihood of clinical success and can be manufactured at scale. Experts see three waves of potential vaccines available commercially, with those from Moderna, Pfizer / BioNTech, AstraZeneca/University of Oxford, and CanSino likely in the first wave before the end of 2020. We expect vaccines from J&J in 1H21 and Sanofi / GSK in 2H21.

The Trump administration has indicated that it plans to have enough doses of vaccine for the entire US population by the end of 2020.

While all of the leading vaccine researchers and manufacturers are established public companies, opportunities exist for smaller companies. The opportunity cost of vaccine development is estimated to be $2-25B. This gulf leaves a vacuum for smaller biotech and therapeutic companies. We have already seen vibrant fundraising and M&A landscape this year, unfazed by the outbreak.

Once passed over as the Disney CEO, Kevin Mayer announced a surprising move to become TikTok's CEO and COO of ByteDance. Rebecca Campbell, a 23-year media veteran will be his replacement at Disney.

Interested in Private Company Financials?
Find private company intel in matters of seconds with our AI-powered search engine.

Search Now

Rising Stars:

Insurtech startup Root Inc. offers personal auto policies that rely on telematics data. While telematics was not a new concept when Root Inc. started, one of the characteristics that set the insurtech startup apart was that its telematics system relied exclusively on the driver's smartphone. Root has more than doubled its employee count in three years and has grown revenues by 10x in the past year. It has raised $535M so far. Read more.

Funding & Deal Highlights:

Clubhouse, an audio-based social network with fewer than 5,000 beta test users, has closed an eyebrow-raising $10M round at a $100M valuation from famed US venture capital firm Andreessen Horowitz (aka a16z). The news has drawn huge attention from the startup world, with some speculating that a bunch of "Clubhouse for X" companies will soon launch. But there are also skeptics who question the extension of the simple phone call. While the app is still in beta, the world can't seem to wait for its arrival.

Matterport, a provider of 3D capture software, raises nearly $40M in new VC funding. It works with existing hardware, such as an iPhone, to scan and recreate 3D images. The applications of the software include real estate, construction, travel, and insurance. The company is seeing increased demand as a new normal sets in.

St. Louis-based life sciences startup C2N Diagnostics, which has developed a blood test designed to detect Alzheimer's disease, said Thursday it has received a $20M investment.

Arnie Bellini invests in Vinik-backed restaurant tech company Omnivore.

Hopper, the online travel agency that has emphasized pricing predictions, closed a $70M round of funding.

Envoy, a startup focused on remote work, secures $30M. Check out all startups curated by PrivCo that fit the theme by searching for "workplace management" as a keyword.

LA-based Ettitude, maker of bamboo bedding and sleepwear, raises $1.6M.

Graham Holdings Company acquires Framebridge, Inc.

Hostmark acquires RAR Hospitality.

Higginbotham acquires a TX-based independent insurance broker from Extraco Banks.

Clairvest buys Sunpower's solar operations and maintenance unit.

Since last week, PrivCo has added:
71,482 Profiles | 101 M&A Deals | 160 Fundings
Exclusive Revenues, EV, EBITDA, and Valuations

Softbank's year-end highlights

Jack Ma leaves the board after 2 other high profile board departures last year. Moreover, Softbank's Vision Fund lost $18B last year. [read more]

Peet’s Coffee Owner Brews $2.2 Billion IPO

Peet's Coffee is pushing ahead with an initial public offering of its coffee business, aiming to raise up to $2.2B, according to a person familiar with the matter—a bet coffee’s resilience will appeal to investors amid uncertainty over the coronavirus pandemic. [read more]

Thanks for reading.
Be well and stay healthy!

Not a subscriber yet? Sign up here.