Reported Holdings as of January 31st, 2020:
ZX Market Update since January 31st, 2020:
Other companies mentioned in this report: Allbirds, Circle, Clover Health, Coupang, Coursera, Databricks, Deliveroo, Impossible Foods, Ripple, Reddit, SpaceX, Stripe, The Honest Company, Wish
Based on data reported by 194 funds, ZX Monthly Movers summarizes notable movements in holding values of venture-backed private companies as reported by shareholders subject to reporting requirements.* Period-to-period comparisons are measured quarterly to coincide with reporting intervals.
ZX is the Zanbato Alternative Trading System. A ZX Firm Order is explained at the end of ZX Monthly Movers.
*This report is based on data reported by 194 funds. Many holders of private company shares do not report their holding values and are thus not included in this report’s dataset. Further, many venture-backed private companies are not held by any reporting funds and are thus not included in this report. As such, this report should not be construed as providing a complete picture of shareholder sentiment or venture-backed private company performance.
1 Equal-weighted mark-up or mark-down across all reported holdings
2 Dollar-weighted return on all reported holdings
3 Range measured as Max Holding Value/Min Holding Value
4 Trend Reversal – Positive reflects companies marked up after consecutive quarterly periods marked down or flat
5 Trend Reversal – Negative reflects companies marked down after consecutive quarterly periods marked up or flat
6 Premium and Discount agnostic to share class
We anticipate this January 31st, 2020 reporting period is the last before shareholders considered the exceptional global impact of COVID-19.
On average, private company holdings were marked up 4.4% this reporting period, leading to a 1.8% appreciation in tracked portfolios. DraftKings ($3.42-$4.09/share), Taboola ($27.91/share), and Deliveroo ($502.30/share) contributed the largest reported dollar gains, while JUUL ($120.83/share), Sweetgreen ($14.75-17.69/share), and Rubicon Global ($18.40/share) recorded the largest dollar losses.
DraftKings ($3.42-$4.09/share) led gainers, moving 42.5% higher in anticipation of its reverse merger into Diamond Eagle. Information and data security companies saw a strong quarter with both Tanium ($7.62-$10.86/share) and Malwarebytes ($21.50/share) making the top gainers list and Lookout ($0.54-$7.79/share) being modestly marked up as well. Notably, Lookout ($0.54-$7.79/share) preferred shares were marked narrowly at $7.77-$7.79/share, while common stock was valued significantly lower at $0.54/share.
Rubicon Global ($18.40/share) led mark-downs, moving 21.9% lower from its previous mark of $23.55/share and 31% lower from its median holding value of $26.64/share a year prior. While Sweetgreen ($14.75-17.69/share) saw one of the largest percentage mark-downs, it received mixed treatment this quarter with some holders marking up their holdings, leading to one of the largest ranges in holding values. JUUL ($120.83/share) holding values fell 12.5%, though ZX currently has Firm Offers at $86.00/share, almost 30% lower.
Clover Health ($3.83/share) rebounded modestly, gaining 17% this period after having been marked down 65% in the previous period.
Since January 31st, 2020, ZX pricing levels have fallen as buyers and sellers work to price the impact of COVID-19 on companies and markets. As we noted in our last ZX Monthly Movers, investors continue to evaluate expected impact on a company-by-company basis, with significantly reduced valuations for firms more affected by novel coronavirus contrasting those maintaining pricing levels around (or in excess of) their last financings.
Current ZX Firm Offers provide a window to quantify some of the moves. ZX Firm Offers currently reflect an average 29% discount to last reported holding value, with companies like Wish ($146.96/share), Reddit ($36.47/share), and JUUL ($120.83/share) being offered at 45%, 40%, and 29% discounts, respectively.
Relative strength can be seen in larger private companies such as SpaceX ($214.00/share) and Stripe ($15.69/share), where demand is bolstered by investors looking for opportunistic entry points, as well as in enterprise software companies like Databricks ($42.95/share). Other areas of strength include edtech companies like Coursera ($11.34/share), where ZX currently houses Firm Bids at a premium to latest holding value.
Next month’s report will start yielding quantifiable insight into how institutional shareholders are reflecting broader market turbulence into their private company holding values.
ZX Firm Orders are unique to ZX. A ZX Firm Order (Offer or Bid) is a form of contract accepted on ZX, that allows a buyer or seller to contractually commit themselves to trading at the terms of an order ticket should a bona fide counterparty be presented, or pay a fee set to 10% of the notional value of the transaction should they fail to transact. Zanbato developed the concept of a Firm Order for private stock trading to solve for frequent frustration that parties often hold themselves out as buyers or sellers, but then pull out of transactions when counterparties are presented.
Zanbato Securites LLC (“Zanbato”) prepares and disseminates market information about venture-backed private company securities, and the current bids and offers for those securities listed on the ATS operated by Zanbato (“ZX”). The information provided in this report has been prepared by sales, trading, or other non-research functions. Pricing indications and macro commentary are provided for factual information purposes only. This report is not intended to assess the individual merits of a particular investment or strategy, does not constitute a recommendation to buy or sell any financial instrument or to participate in any trading strategy and should not be construed as such. This report does not constitute investment advice. Certain information in this report has been obtained from third party sources and, while such information was believed by Zanbato to be reliable, it has not been independently verified by Zanbato and Zanbato shall not be responsible or liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with any use of, or reliance on, such third party information. Furthermore, the information contained in this report may not be current due to, among other things, changes in the financial markets or economic environment. Zanbato does not, and has no obligation to, update any such information contained in this report. Any prices or quotations contained herein are indicative only, do not represent firm quotes as to either price or size and should not be used for valuation purposes.
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We use this data to identify usage patterns and improve our site’s design. In this context, your IP address is used purely as a geographic indicator assigned to an anonymous user. As long as you aren’t signed in, we can’t link this information back to you as an individual.
We will retain your Personal Information for the period necessary to fulfill the purposes outlined in this Privacy Notice unless a longer retention period is required or permitted by law.
ZX is the exchange platform located at trading.zanbato.com and is only accessible to users authorized by Zanbato staff. To use ZX, we’ll need to collect and process more of your personal information for a few purposes.
At a high level, ZX is a mediated deal network. It’s built so your personal information is generally only visible to ZX staff—up until the point when a deal has been agreed and everyone needs to sign on the dotted line.
Read on to learn about the ways ZX handles your personal info. In this section, we’ll describe each of our processes, and how we handle the data.
When you register, several financial regulatory bodies require us to collect various personal information. This “registration information” includes full name, employer, title, business address, business telephone number, and business email address. In addition, before you may close a transaction on the site, we are required by the same bodies to have you fill out a “confidential customer questionnaire.” This form may request the ID number of your driver’s license or passport.
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Several financial regulatory bodies require us to collect various personal information. This “registration information” includes full name, employer, title, business address, business telephone number, and business email address. In addition, before you may close a transaction, we are required by the same bodies to have you fill out a “confidential customer questionnaire.” This form may request the ID number of your driver’s license or passport.
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Zanbato and our U.S. affiliates including Zanbato Securities LLC participate in and have certified their compliance with the EU-U.S. and the Swiss-US Privacy Shield Framework.
Zanbato is committed to subjecting all personal data received from European Union (EU) member countries and Switzerland, in reliance on the Privacy Shield Framework, to the Framework’s applicable Principles. To learn more about the Privacy Shield Framework, visit the U.S. Department of Commerce’s Privacy Shield List.
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Our company and its infrastructure are based within the United States. Keep in mind that this means your personal data will be transferred to the U.S. for processing when interacting with Zanbato.
The European Commission recognizes that companies in the U.S., under the Privacy Shield framework, provide adequate protection for the transfer of personal data. If we ever need to transfer data to a non-recognized country or U.S. company, we will let you know.
For the purposes of GDPR, our designated representative based in the EU is Christopher Fenichell. Our representative may be reached in writing at Zanbato UK Ltd., 52 Debden Road, Saffron Walden, Essex, CB11 4AB, United Kingdom, or by email at firstname.lastname@example.org.
1.1 Structure & Links
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1.4 Scope of Use.
1.4.1 Access. You agree to access and use the Site and all Site Content solely pursuant to your login information (username and password). You agree to notify us and change your password immediately, if your password is lost, stolen, or misused. You are responsible for all activity (including any unauthorized activity) attributable to your login information.
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1.6 Registration and Access Data; Authorized Customer Delegees
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1.7 Log-In Credentials; Security.
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1.8 User Provided Content. All Site Content (other than the BROKER-DEALER and Zanbato Content and Linked Site Content), including comments, questions, and opinions uploaded, expressed, or submitted to a message board, blog, or other publicly available section of the Site (including password-protected areas) and all responses thereto are solely the opinions and responsibility of the person or entity submitting them and not BROKER-DEALER and Zanbato. You understand and acknowledge that you are responsible for whatever content you submit and that you, not BROKER-DEALER or Zanbato, have full responsibility for such content, including its legality, reliability, and appropriateness. Under no circumstances may you submit information that you know, or have reason to believe, is false or intentionally misleading. By uploading or otherwise transmitting material to any area of the Site, you warrant that the material is your own or is in the public domain or otherwise free of proprietary or other restrictions and that you have the right to post it to the Site. You grant to BROKER-DEALER and Zanbato the perpetual, irrevocable, transferable, worldwide, royalty-free right and license to use all content you upload or otherwise transmit to the Site in any manner BROKER-DEALER and Zanbato may choose in connection with the Site. BROKER-DEALER and Zanbato reserve the right, but do not assume any responsibility, to remove any material posted on the Site which BROKER-DEALER and Zanbato, in their sole discretion, deem inconsistent with the foregoing commitments, including without limitation any material as to which BROKER-DEALER or Zanbato has been notified, or have reason to believe, constitutes a copyright infringement. BROKER-DEALER and Zanbato can neither review all material before it is posted on the Site nor ensure prompt removal of objectionable material after it has been posted. Accordingly, BROKER-DEALER and Zanbato will have no liability for any action or inaction regarding or otherwise involving Third-Party Content.
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5.1 Representations and Warranties.
5.1.2 Representations, Warranties and Agreements. You represent and warrant to, and agree with BROKER-DEALER and Zanbato (which representations, warranties and agreements shall be deemed repeated each time you access or use the Site), that:
(i) You are in compliance with all applicable laws in all material respects;
(ii) all information provided by you in writing to BROKER-DEALER and Zanbato (including all information contained in applications, questionnaires and information forms, and including information delivered via electronic means) is true and accurate in all material respects;
(iv) you have all Intellectual Property Rights (as defined in the Rulebook) in and to any information submitted by you to the Site, and its use of any software or equipment to access the Site (other than software or equipment provided by BROKER-DEALER or Zanbato) does not violate any third party's Intellectual Property Rights;
(vi) If you are a customer of BROKER-DEALER, alone or together with your Authorized Customer Delegee, you possess the sophistication, experience, knowledge and expertise in financial and business matters to make your own investment decisions and to properly assess the merits, risks and suitability of investing in, and entering into transactions on the Site;
(vii) If you are a customer of BROKER-DEALER, alone or together with your Authorized Customer Delegee, you are (x) capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies involving a security or securities and (y) will exercise independent judgment in evaluating the merits of all potential transactions;
(viii) you acknowledge, agree and understand that (x) all transactions entered into on the Site are unsolicited transactions, (y) no such transaction will be solicited or recommended by BROKER-DEALER or Zanbato and (z) your decision to enter into any transaction on the Site will be based on your own research and information, or on research and information obtained from a source other than the Site, BROKER-DEALER or Zanbato, and neither BROKER-DEALER, Zanbato nor any of their respective representatives will have any input into your decision to enter into such transaction;
(ix) If you are a customer of BROKER-DEALER, you are and will continue to be either (x) a qualified institutional buyer under Rule 144A of the Securities Act of 1933, as amended (the "Securities Act"), (y) a qualified purchaser, as defined in Section 2(a)(51) of the Investment Company Act, or (z) an accredited investor under Rule 501 of Regulation D of the Securities Act, subject to the right of BROKER-DEALER to impose higher accreditation standards to comply with suitability requirements;
(x) you shall comply with all applicable laws related to anti-money laundering and sanctions and (y) if you are a Customer of BROKER-DEALER, you shall ensure that you and your Authorized Customer Delegees follow such applicable laws with respect to your and their use of and access to the Site.
You shall notify BROKER-DEALER and Zanbato promptly in the event any of the foregoing representations and warranties become untrue at any time during the term of this Agreement.
5.1.3 Role of Zanbato. You acknowledge and agree that, notwithstanding anything to the contrary herein:
(i) Zanbato shall not, directly or indirectly, be a principal to any transaction on the Site or be responsible for, or otherwise guarantee, performance of any transaction entered into by you, and you shall proceed solely against the counterparty in that transaction, and not against Zanbato, to collect or recover any amounts owed to you or to enforce any of its rights in connection with, or as a result of, such transaction;
(iii) BROKER-DEALER and Zanbato may receive fees from subscribers to the Site representing both the buyer and seller in respect of a transaction effected through the Site; and
(iv) if you are a customer of BROKER-DEALER, the submission or posting of any Information to or on the Site by BROKER-DEALER, Zanbato or any authorized user of the Site shall not be deemed a recommendation by Zanbato or such authorized user that you enter into any particular transaction or that any particular transaction is suitable or appropriate for you.
6.1 Nondisclosure of Confidential Information. You agree to use reasonable care, but in no event no less than the same degree of care that you use to protect your own confidential and proprietary information of similar importance, and to prevent the unauthorized use, disclosure, publication or dissemination of proprietary, non-public, confidential information ("Confidential Information") of any Information Provider. You agree to accept an Information Provider's Confidential Information for the sole purpose of evaluation in connection with your business discussions with BROKER-DEALER. You agree not to disclose or use Confidential Information otherwise for your own or any third party's benefit without the prior written approval of an authorized representative of BROKER-DEALER in each instance. You may disclose Confidential Information if required by any judicial or governmental request, requirement or order; provided that you first take, if permitted to do so by the judicial or governmental authority with jurisdiction, reasonable steps to give the Information Provider sufficient prior notice in order to contest such request, requirement or order by notifying the Information Provider of such request. You may only disclose Confidential Information to your employees or agents with a need to know for the sole purpose of evaluation in connection with your business discussions with BROKER-DEALER and, in the case of agents, only to the extent that the agent has signed a non-disclosure and non-circumvention agreement at least as restrictive as this Agreement. Information will not be deemed Confidential Information of an Information Provider that (i) is already in your possession prior to disclosure by such Information Provider, (ii) that is or becomes generally available in the public domain other than as a result of unauthorized disclosure by you or your employees or agents, or (iii) is acquired by a third party not in violation of an obligation of secrecy to such Information Provider.
7.1 Bids, Offers and Firm Orders. "Bids" and “Offers" on the Site represent non-binding indications of interest submitted by Zanbato, BROKER-DEALER or one of their respective authorized registered representatives on behalf of their clients (unless such bids/offers are noted as “firm”). A “firm” bid or offer (each, a “Firm Order”) obligates the customer of Zanbato or BROKER-DEALER submitting the Firm Order to pay commissions or banking fees on introduction of a counter-party accepting the terms of their Firm Order, meaning these orders represent a higher level of commitment to transact. Bid and Offers may be for any class of equity security of an issuer and may be for blocks of shares held, exercizable, or held or to be held in special purpose vehicles. Rights of holders of the securities will vary, and transactions may be subject to transfer restrictions, including a right of first refusal by the issuer or others. Some issuers may restrict transfers in their securities to certain classes of investor. Specific information on a given ticket is available from Zanbato market operators through its Z-Chat function.
7.5 Governing Law and Arbitration. This Agreement shall be governed by the laws of the State of New York, without regard to its conflicts of laws principles. The parties shall attempt to resolve any disputes under this Agreement in an amicable manner by mediation before a single mediator administered by the American Arbitration Association ("AAA") or Judicial Arbitration & Mediation ("JAMS"), under their respective applicable commercial mediation rules, before resorting to arbitration. Thereafter, any unresolved dispute arising out of or relating to this Agreement shall be settled by binding and non-appealable arbitration administered by the AAA or JAMS under their respective Commercial Arbitration Rules, and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction over the parties in the state or federal courts located in New York and the parties hereby consent to the personal jurisdiction and exclusive venue of these courts.