Sep 12, 2022

Photo: Adwoa Beauty What companies are finding funding or having a big exit? From startup investments to grants and acquisitions, Dallas Innovates tracks what’s happening in North Texas money. Sign up for our e-newsletter, and share your deal news here . Hair care brand Adwoa Beauty lands $4M to ‘keep up with demand’ ⟫ Adwoa Beauty, a beauty brand for textured hair care that can be found on the shelves of Sephora, raised $4 million from growth investing and advisory platform Pendulum. Previously self-funded after being founded by Julian Addo in 2017, the company said the new money will help it with product development, building out its team, and invest in brand awareness in order to “keep up with demand.” Addo said the funding comes at a “critical juncture in (Adwoa’s) growth potential.” PLUS Prescription lens maker NeuroLens lands $67M in new funding Neurolens, a Coppell-based maker of prescription lenses that “link optometry with neurology,” raised $67 million in a funding round led by Boston-based health care investor MVM Partners. Falcon Vision/KKR, Marshall Wace, and Bluestem Capital joined the round, which Neurolens said will be used fuel “innovation and growth initiatives,” in the hopes of “accelerating the adoption” of its products. As part of the move, MVM Partners Dr. Eric Dednarski and Dr. Akhilesh Pathipati will join Neurolens’ board. The funding also comes as the company, founded in 2016, landed the No. 1,773 spot on the 2022 Inc. 5000 list, reporting 346% three-year growth. — Dallas startup VRGL raises $15M six months after launching Less than six months after launching, a Dallas startup has raised funding to help it serve the wealth management industry. VRGL, an automated data and analytics platform for wealth management firms, announced raising a $15 million Series A funding round led by MissionOG and FINTOP Capital. The funding round was joined by founding investors Sallyport Investments and Checchi Capital, along with participation by Dynasty Financial Partners, Northwestern Mutual Future Ventures, Flyover Capital, Fin Capital, and The Compound Capital. VRGL said the new funding will be used to scale operational resources, build its sales and partnership capabilities, and execute on its product and marketing roadmap. “VRGL has experienced tremendous initial new customer growth with leading advisor groups adopting its platform, quickly establishing the company as the emerging industry standard,” Andy Newcomb, co-founder and managing partner at MissionOG, said in a statement. — nVenue adds $1M to seed round to fuel micro-betting push ⟫ Helping to propel Dallas-based predictive analytics startup nVenue towards its long-term goal of becoming the go-to platform for sportsbooks to facilitate micro-betting, it has raised $1 million from EBCI Holdings —the commercial gaming arm of North Carolina’s Eastern Band of Cherokee Indians—adding to a $3.5 million seed round of funding it landed earlier this year led by KB Partners and Corazon Capital. nVenue CFO Drew Williams CFO Drew Williams said the new investment from EBCI Holdings, something the company wasn’t actively pursuing, gives nVenue a strategic partner with deep experience in the space, noting that the organization targets companies in the gaming industry space that it sees itself as a potential future client of. With its eyes on raising a Series A round towards the end of next year, Williams said the latest funding will help the company continue to grow its team in order to help add more sports to its platform—especially ones he calls “underserved,” like golf, tennis, and NASCAR—while continuing to build out its tech and bring on new clients. — Google for Startups Black Founders Fund invests in Deposits.com, DUKE.AI ⟫ Two North Texas startups can now count one of the largest tech firms in the country—Google—as their newest backer. The Alphabet-owned company has awarded Dallas companies Deposits.com and DUKE.AI $100,000 each in new funding via its Google for Startups Black Founders Fund. The fund was created with the goal of closing the racial disparity of venture capital funding that goes towards diverse founders. Along with the funding, all 50 startups selected by the fund will receive Google Cloud credits and hands-on support from Google. The Google for Startups Black Founders Fund is part of a $175 million investment commitment by Google to back the Black business community in the wake of protests sparked by the police killing of George Floyd and Breonna Taylor. This year, only 1.2% of venture capital dollars have gone to startups with at least one Black founder, according to Crunchbase. —   ⟫ Blowing past its initial goal of $250 million, Dallas-based multifamily investor S2 Capital announced the final close of its first investment fund—titled S2 Multifamily Value-Add Fund I, LP— hitting a hard cap of $400 million . The firm said it was able to raise it all in eight months. S2 says it will use the money to continue its focus of investing in apartment properties across the Sun Belt region. With $6 billion under its management, S2 has acquired around 46,000 multifamily units with about $7.5 billion in transaction volume since its founding a decade ago. — Andy Love ⟫ Dallas investment firm Aspect Investors amended an SEC filing from last September to reflect raising nearly $53.3 million from 57 investors for a private equity fund titled Aspect Acquisition Partners II, LP. When the company first filed, it had yet to raise any funds. Founded by Andy Love in 2012 Aspect Investors says its approach involve partnering with “entrepreneurial CEOs” to acquire and grow companies with revenues between $5 million and $10 million. The firm’s website says it has 37 operating companies in areas including technology and health care. — VC firm Star Castle Ventures raises $4.5M for new fund ⟫ Stealthy venture capital firm Star Castle Ventures, which lists its address in Fort Worth, reported raising more than $4.5 million in pooled investment fund interests from 33 investors for a fund titled Star Castle Ventures VC, LP – Firehawk. In its SEC filing, the firm lists “Llc Pbc General Partner” as its director. The firm’s website is just a landing page stating that it is “investing in next-generation security and defense.” — Crowdfunding investment platform Harvest Returns raises $815K ⟫ Harvest Returns, a Fort Worth-based crowdfunding investment platform focused on agricultural technology and innovative practices, reported raising $815,000 in equity from 27 investors out of a $1.2 million offering for a fund titled Harvest Invest-045 LLC, per an SEC filing. Harvest Returns says it has a pool of more than 8,000 investors that have provided more than $17 million in funding to early-stage businesses in the industry since launching in 2016. — CBRE leads $125M Series E for proptech company VTS ⟫ Dallas-based real estate giant CBRE led a $125 million Series E funding round for New York proptech company VTS. As part of the deal, CBRE said it plans to roll out the VTS platform, which helps with leasing and asset management, to its teams in areas across the U.S. According to VTS, its platform helped users execute more than $31 billion in leases last year. The funding round, which was joined by BentallGreenOak, AmTrust, Brookfield Ventures, and Insight Venture Partners, comes as VTS also announced securing $150 million in debt financing from CIBC Innovation Banking. — TPG co-leads $110M Series D for fast-growing Indian startup EarlySalary ⟫ Alongside Norwest Venture Partners, the impact-focused arm of Fort Worth- and San Francisco-based investment giant TPG co-led a $110 million Series D funding round in India-based financial lending solutions startup EarlySalary. Founded in 2015, EarlySalary says it has grown 7x over the past two year, expanding to more than 150 cities and amassing about 1 million customers. — Dallas Venture Capital leads $5M investment in revenue growth solutions company StepFunction ⟫ Emerging technology-focused early-stage investor Dallas Venture Capital led a $5 million post-seed round for California-based SaaS revenue growth solutions startup StepFunction, which was joined by Hummer Winblad Venture Partners, Inventus Capital Partners, and Z5 Capital. In May, the local VC firm, which has offices in India, raised $80 million for its second flagship fund . While also raising $50 million for its DVC India Fund I, Managing Director Dayakar Puskoor said the firm will deploy approximately $130 million in capital over the next four to five years. Formed in 2020 as Naya Ventures, Dallas Venture Capital counts 15 companies in its portfolio, per its website. The firm focuses on B2B SaaS companies working in emerging tech spaces like AI, machine learning, and extended reality. Earlier this year, it said it plans to invest in around 20 to 25 companies at the rate of about one per quarter as it deploys the two funds. DVC typically writes checks between $2 million and $5 million, mostly in the post-product market for companies, with follow-on investments totaling up to $10 million. The firm seeks to accelerate businesses’ revenues from around $1 million to $10 million, according to Dallas Venture Capital Co-Founder and Director Abidali Neemuchwala. — Local PE firm Pharos Capital Group acquires health care company Renal Care 360° ⟫ Dallas- and Nashville-based private equity firm Pharos Capital Group announced making a “significant investment” in Renal Care 360°, a nephrology practice and chronic care management company. Along with funding from existing shareholders, Renal Care said it plans to use the new money to fuel new acquisitions to expand its geographic footprint and further develop its value-based care programs. The company will continue to be led by chairman and CEO Joe Cashia. — CVS Health acquires Dallas’ Signify Health in $8B deal ⟫ Beating out other big-name contenders like Amazon in the bidding battles, CVS Health is set to acquire Dallas’ Signify Health. The Rhode Island-based company behind the national chain of pharmacies has inked an agreement to acquire the local tech-enabled home health services firm for $30.50 per share— a deal valued at around $8 billion . As it looks to reach more patients in the home, CVS President and CEO Karen Lynch said the move will help better address those patients’ needs, while bolstering its ability to expand its footprint in the value-based care market with “new product offerings in a multi-payor approach.” Kyle Armbrester Following the expected close of the deal in the first half of next year, CEO Kyle Armbrester will continue to lead the 600-person Signify team as part of CVS Health, which is valued at more than $130 billion and saw nearly $300 billion in revenue last year. Signify went public last February, raising $564 million in an IPO that saw it debut on the New York Stock Exchange—where CVS also trades—under the ticker SGFY. UnitedHealth Group and Option Care were also bidders for Signify. — Texas Capital Bancshares sells off subsidiary for about $3.4B ⟫ Dallas’ Texas Capital Bancshares is selling off BankDirect Capital Finance, the firm’s insurance premium subsidiary to AFCO Credit Corporation—an indirect wholly owned subsidiary of Truist Financial Corp.—for an all-cash deal with the purchase price of around $3.4 billion . Expected to close in Q4, the deal includes BankDirect’s business operations and loans portfolio of about $3.1 billion and represents an 8.5% asset premium compared to the value of the purchased loan portfolio as of June 30, it said. Texas Capital President and CEO Rob Holmes said the move is an “important milestone,” allowing the company to re-focus its capital and expense base, while following a “deliberate process designed to maximize shareholder value, strengthen our balance sheet, simplify our business model and free up incremental resources to be redeployed to our core businesses.” — Investment group takes 35% stake in Dallas’ DataBank for $1.5B ⟫ A 35% stake in DataBank—a Dallas-based leader of the booming data center market—has been sold for $1.5 billion to a new group of investors. The deal was structured as a sale of ownership interests from some of DataBank’s existing investors. The new investor group is led by Swiss Life Asset Management, EDF Invest, Northleaf Capital Partners, and Ardian. Since 2016, DataBank has been building what it calls “an ecosystem” of over 65 data centers and 20 interconnection hubs in over two dozen Tier 1 and Tier 2 U.S. metros. The company said it views the acquisition as “validation for the company’s plans to build upon its industry-leading footprint and capitalize on edge infrastructure growth for the next decade.” The new investor group joins DigitalBridge, which remains invested in the company. DataBank’s website lists investors including Nuveen (the investment manager of TIAA), CBRE, Caledon Capital Management, Allstate Investments, and Dock Square Capital. — Texas Brand Bank, Harmony Bank to merge with more than $700M in assets ⟫ Dallas-based Texas Brand Bank announced a merger agreement with Harmony Bank, a community-focused bank serving North Texas that was originally founded in 1901. As a result of the merger—which is subject to shareholder and regulatory approval—Harmony Bank will merge “with and into” Texas Brand Bank, and the combined company will operate under the Harmony Bank name as a state-chartered bank. Harmony Bank is expected to have over $700 million in assets, with 11 bank locations in Dallas, Ellis, Henderson, Kaufman, and Navarro counties. Dallas-based and Dallas-grown, Texas Brand Bank says it was created to provide banking services to “Dallas-area small businesses and residents.” In the 17 years since its founding, it’s grown to over $340 million in assets with five locations in Dallas and Garland, including banks in Uptown Dallas, Deep Ellum, The Cedars, and Oak Cliff’s Bishop Arts District. “The combination of our two financial institutions will allow us to double our lending limit and acquire additional digital banking options, giving us the ability to provide greater service to current and future customers,” Texas Band Bank president and CEO William Lowe said in a statement. Lowe and Texas Brand Bank chairman Edward “Bubba Tomlinson II will join Harmony Bank’s board. — Tuesday Morning lands new owner ⟫ Dallas-based retailer Tuesday Morning Corporation has a new owner. One that’s familiar with the business, also owning local consumer brands Pier 1 Imports and RadioShack, along a handful of others. The publicly traded home goods and décor brand has inked a $32 million convertible debt financing deal (ADD DI LINK WHEN PUBLISHED) with a newly formed special purpose vehicle by California’s Retail Ecommerce Ventures, the owner of companies like Linens ‘n Things, Stein Mart, and Ayon Capital. In addition to the new funding from Retail Ecommerce Ventures, Tuesday Morning CEO Fred Hand and other members of its leadership team are also providing $3 million in convertible debt financing. As part of the deal, Tuesday Morning will reshuffle its board, with Retail Ecommerce Ventures and Florida-based Ayon Capital to later appoint designees that will make up the majority of the board. In addition, the company said it will look to build out an e-commerce and digital presence using Retail Ecommerce Venture’s fulfillment network, infrastructure, and technology, alongside a new licensing agreement that will allow it sell Pier 1 products. Due to its business model of buying closeout items from others, which means its inventory changes often, Tuesday Morning has shied away from e-commerce in the past, The Dallas Morning News reports . Tuesday Morning said the deal, which is expected to close next week, will help strengthen its balance sheet, with an omnichannel push helping to complement its “store footprint in the long-term.” “We believe this milestone transaction will strengthen our financial position and provide sufficient liquidity to execute on our strategic plan, allowing us to maintain strong relationships with our valued partners and elevate offerings for our customers,” Hand, said in a statement. — Coppell-based emergency solutions provider Kings III of America lands Arcline Investment Management as new owner ⟫ California private equity firm Arcline Investment Management has acquired Coppell-based Kings III of America, a third-party provider of elevator and pool emergency solutions, from Rockbridge Growth Equity and Thayer Street Partners. Terms of the deal were not disclosed. Founded in 1989, Kings III designs and manufactures emergency phones, in addition to running an “emergency dispatch center.” Kings III CEO Dennis Mason said the move will help the company “leverage Arcline’s deep experience in the elevator industry to accelerate our growth .” — BenefitMall expands Midwest footprint with acquisition of Mutual Med ⟫ Dallas-based BenefitMall, one of the country’s largest general agency brokerage services, acquired Iowa insurance distributor Mutual Med. The company said the move will add new carriers , lives of coverage, and expanded voluntary benefits to its clients, in addition to bolstering its presence in the Midwest. BenefitMall added that the acquisition adds new markets in Alabama, Illinois, Iowa, North Carolina, North Dakota, and Tennessee to its service territory. Mutual Med will continue under its current name and leadership as a division of BenefitMall. The move comes as BenefitMall itself is soon to be acquired. Last month North Carolina-based Truist Financial Corporation subsidiary Truist Financial announced plans to acquire the company, in a deal that Truist expects will add around $150 million in annual revenue . As part of that deal, BenefitMall will be combined by Truist-owned CRC Group, a distributor of specialty insurance products. — Dallas’ Beckett Collectibles acquires collector connection platform NoXX Technologies ⟫ Dallas’ Beckett Collectibles, a platform for pricing, grading, and authenticating collectible items, acquired NoXX Technologies, a New York-based platform aimed ay “connecting collectors.” Terms of the deal were not disclosed. As part of the move, NoXX CEO Scott Roskind will join Beckett as its “new chief visionary officer” as NoXX integrates its technology with the company. “The acquisition of NoXX is one more important step in our creation of the industry’s digital leading platform,” Kunal Chopra, CEO of Beckett, said in a statement. “We want to build a central location to connect collectors and give them every tool they need—and the NOXX Technologies’ product suite as well as its talent will help us do that.” Want more?