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PE HUB Wire Highlights, 10.15.18

NEA to spin out startup investments from older funds; HGGC, GA merge portfolio cos to fight Amazon effect; Hicks Family office PE arm raises funds for food and beverage

Happy Monday, everyone.

We have another victim of the retail apocalypse. Sears, the once powerful retail heavyweight, has filed for bankruptcy protection. Sears has not turned a profit since 2011 and critics have blamed CEO Eddie Lampert with allowing the stores to deteriorate over the years, Reuters reports. Lampert is stepping down as CEO but will remain chairman, Dealbook said.

It’s interesting that this morning we have a merger of two private equity portfolio companies, Mi9(General Atlantic) and MyWebGrocer (HGGC). The goal of the deal is to create a new company, called Mi9 (yes, like the British spy group), that will help retailers respond to Amazon, which many blame for the death of retail.

Retailers, HGGC’s Rich Lawson said, need to upgrade or die. He pointed to Amazon’s massive $22.6 billion R&D spend in 2017. That huge R&D budget is more than what the top 20 retailers spent on innovation combined, Lawson said.

Mi9 helps retailers manage their merchandise and take and process orders, while providing data analytics and point-of-sale technology, Lawson said.

“The best way to really help retail is to come together,” Lawson said. “I wouldn’t call it Custer’s last stand, but if someone doesn’t come together – big-box retailers, grocers and technology — we will see the beginning of the end. Look at Sears. This will keep happening. People need to invest and we have the technology to help them,” he said.

Read my story on the merger of Mi9 and MWG here.

Minority stakes: Another firm has sold a chunk of itself. Pacific Current Group has acquired a minority of Victory Park, the Chicago credit specialist, according to reports. This happened over the summer. Sneaky, sneaky.

Deals: Sometimes I like deals because they’re just cool. Spectrum Equity has acquired a majority of AllTrails, which provides digital guides for the outdoors. See our brief here.

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