Where in the world: BFD San Francisco is on May 10 (request your invite). But, before that, I'll be working out of Miami the week of April 17 and will be at the Milken conference in Los Angeles on May 1-2. If you're up for coffee and conversation, drop me a line...

When newsletter platform Substack last month launched a crowdfunding campaign, its writers and fans responded with more than $7.5 million in demand at a $585 million pre-money valuation.

• What none of those new investors knew, however, were Substack's recent financials. They still don't. And won't.

The big picture: Substack is raising the money via a platform called Wefunder, which relies on crowdfunding rules that became law in 2016. Per Wefunder's website:

That means Substack was required to disclose financials for 2020 and 2021 only, which it did yesterday ($12m of 2021 revenue, $22m net loss and $55m of cash on hand). It could have added all or part of 2022 financials to the mix, but chose not to.

• "We're a private company, so we're releasing what we're required to release," explains Substack co-founder and CEO Chris Best.
• That said, Substack did provide prospective investors with some updated user growth metrics that it wasn't required to release (including 2x year-over-year monthly active subscriptions).

Zoom out: Substack's basic investment pitch to newsletter writers, which some of them regurgitated to me, was aligning interests and supporting a platform that's supported them.

• Loyalty is great. But this is blind loyalty.
• If Substack's primary goal was to align interests, it could have found other ways. Particularly given Best's contention that the company doesn't actually need the money, despite failing to raise a planned venture round last year (he says Substack is on a path to profitability without more outside investment).
• Moreover, if Substack doesn't need the money, how is a writer investing an average of $1,100 really supporting the company?

Other ways: Substack could have offered to increase a writer's cut of subscription revenue or providing cash bonuses if the company hit certain metrics.

• It could have gifted equity, although that's admittedly thorny (perhaps requiring the writers to officially become advisors).
• Or stick with the crowdfunding, but provide 2022 data that would have let writers make an informed decision. Particularly at such a nosebleed valuation. Remember, Substack's venture capitalists, management, full-time employees and early angel investors all get updates on Substack's financial condition. The only shareholders left out are those coming in via the Reg CF door.

As an aside: There's chatter about Twitter picking a fight with Substack, perhaps due to the latter's plan to build a subscription-based social network. But it's bizarre, given that they both share a major common investor (a16z) and because many of Elon Musk's handpicked "Twitter Files" reporters make their livings on Substack.

The bottom line: Substack's greatest asset has always been its values-driven mission, including a deep respect for writers. Unfortunately, this crowdfunding round didn't show that same respect.

Carbonwave, a Boston-based startup that upcycles Sargassum seaweed into biomaterials, raised $5 million in new Series A funding led by an affiliate of Natixis Investment Managers.

Why it's the BFD: The largest-ever blob of Sargassum seaweed — brown, oily and often pungent — is currently floating toward Florida's west coast, with its outer edges already washing up on local beaches.

Details: Other investors include Viridios Capital, Popular Impact Fund and Katapult Ocean. Carbonwave now has raised a total of $12.9 million, and plans to close on another $2 million within the next month.

• Elsewhere: Macro Oceans, an SF-based startup that farms kelp for transformation into low-carbon chemicals, raised $5 million in seed funding co-led by Refactor Capital, Lowercarbon Capital, and McKinley Capital. 

The bottom line: Carbonwave CEO Geoff Chapin tells me that the company's original plan was to farm seaweed for conversion into biomaterials, but pivoted as Sargassum blooms began to proliferate. It currently has contracts with several Florida resorts to collect seaweed heading toward their properties, and also is having talks with local municipalities.

🚑 HeartFlow, a Mountain View, Calif.-based cardiac diagnostic platform, raised $215m in Series F funding. Bain Capital Life Sciences led, and was joined by Janus Henderson and insiders Baillie Gifford, Capricorn Investment Group, Hayfin Capital Management, HealthCor, Martis Capital, USVP and Wellington Management. https://axios.link/43gkh9u

• Cybereason, a Boston-based endpoint detection and cybersecurity software company, raised $100m from existing backer SoftBank. https://axios.link/418jeX4

• Soft Space, a Kuala Lumpur-based payments platform, raised $31.5m. Southern Capital Group led, and was joined by Transcosmos, JCB and Hibiscus Fund. https://axios.link/439Hl9P

• Peach Payments, a South African online payments firm, raised $31m led by Apis. https://axios.link/43d1tYO

• Earned, a financial advisory service for physicians, raised $12m in Series A funding. Hudson Structured Capital Management and Breyer Capital co-led, and were joined by Juxtapose. www.earnedwealth.com

• JackBe, an Edmond, Okla.-based pickup-only grocer, raised $11.5m in funding from backers like GP Investments. https://axios.link/3zGaM5C

• GaeaStar, an SF- and Berlin-based developer of a clay alternative to single-use plastic containers, raised $6.5m in seed funding from Morningside Technology Ventures, At Inc. Ventures, Dart Labs Ventures, Sand Hill Angels, VSC Ventures and Climate Capital Ventures. www.gaeastar.com

• Field Materials, a construction materials purchasing startup, raised $4.65m in seed funding. Blumberg Capital led, and was joined by Zacua Ventures. www.fieldmaterials.com

• Olyra Foods, a Greek biscuit maker, raised $4m in Series A funding by the VC arm of Mexican food group Grupo Bimbo. https://axios.link/3KeIp3t

• Zero Cow Factory, an Indian developer of animal-free casein protein, raised $4m in seed funding from Green Frontier Capital, GVFL, Pi Ventures and Pascual Innoventures. https://axios.link/3nUtW5u

• Wilk, an Israeli developer of cultured milk, raised $3.5m led by Danone Manifesto Ventures. https://axios.link/3MmqA5m

Tech companies dominated M&A markets last year and are primed to stay on top in terms of transactions.

Expert advice: Understand the opportunities and challenges ahead for M&A with insights from RBC Capital Markets’ expert bankers on Strategic Alternatives, the RBC M&A podcast.

Listen now.

• Area 15 Ventures, a Colorado PE firm created by RE/MAX co-founder Dave Liniger, acquired Reno Nev.-based sandwich chain Port of Subs. https://axios.link/437SOGR

• Great Range Capital of Kansas City acquired Roofed Right America, a Milwaukee-based commercial roofing contractor.

• Mill Point Capital bought Nursery Supplies, a Kissimmee, Fla-based recycler and manufacturer of horticulture containers and trays, from Lincolnshire. www.nurserysupplies.com

• The Mufflerman, a Canadian portfolio company of Argyle Capital Partners, acquired Fleet Specialties, a Canadian provider of maintenance, repair and custom upfitting for commercial fleets and corporate clients. www.themufflerman.com

• RoadSafe, a Romeoville, Ill.-based portfolio company of Trilantic North America, acquired Highway Supply, an Albuquerque, N.M.-based provider of traffic control products and services. www.roadsafetraffic.com

• Thoma Bravo completed its C$1.8b take-private acquisition of Magnet Forensics, a Canadian provider of digital investigation software. www.magnetforensics.com

🚑 Veterinary Practice Partners, backed by Audax Capital, acquired Caring Hands Animal Hospital, a network of eight facilities in Maryland and Virginia. https://axios.link/40Ncuyg

⚡ Hoppecke, a German maker of energy storage units, is considering an IPO of its Intilion lithium-ion unit, which could be valued at around €350m, per Bloomberg. https://axios.link/3m93zZ0

• Arrival (Nasdaq: ARVL), a London-based EV design and manufacturing company that went public in 2021 via a SPAC, agreed to merge with a different SPAC called Kensington Capital Acquisition Corp. V (NYSE: KCGI). https://axios.link/40PAkcI

🚑 Clearday, a San Antonio, Texas-based provider of robotic companion solutions to senior adult care, agreed to be acquired by Viveon Health Acquisition Corp. (NYSE American: VHAQ), a SPAC that previously agreed to buy Suneva (the deal was subsequently terminated). https://axios.link/3zGrfHf

• Navan (fka TripActions), a travel and expense management company valued by VCs at $9.2b, acquired Indian rival Tripeur. Sellers include SenseAI Ventures, Incubate Fund and Better Ventures. https://axios.link/3Uj99Ez

• Nestlé (Swiss: NESN) acquired a 49.95% stake in German meal drinks company Yfood, with an option to buy the remaining shares, at what TechCrunch reports to be a €430m valuation. YFood raised over $20m from firms like Felix Capital, Fonterra Co-op Group, Five Seasons Ventures and New Ground Ventures. https://axios.link/3KA33MR

• Tyler Perry confirmed his interest in buying a majority stake in BET. https://axios.link/3ZOSxFX

🚑 Boston Scientific (NYSE: BSX) completed its $615m takeover of Austin, Texas-based gastrointestinal device company Apollo Endosurgery. https://axios.link/3P2R77b

• Inditex, the Spanish owner of clothing retailer Zara, received Russian regulatory approval to sell its Russia business to UAE-based Daher Group. The deal was first announced last October.

• Learneo (fka Course Hero), a Redwood City, Calif.-based online learning platform most recently valued by VCs at $3.6b, acquired multilingual writing platform LanguageTool. www.learneo.com

• Paramount Global (Nasdaq: PARA) is seeking a buyer for kid-focused streaming service Noggin, per the WSJ. https://axios.link/3zEMSaN

• Canaan raised $850m for its 13th flagship VC fund. https://axios.link/3m7ZOD9

• Erin and Sara Foster, founders of the fashion brand Favorite Daughter, launched a VC firm called Oversubscribed Ventures. Backers include Corazon Capital. https://axios.link/3nOF3ga

🌎 S2G Ventures, a Chicago-based sustainable investment firm, raised $300m for a special opportunities fund, per Axios Pro. https://axios.link/439HM3T

🚑 TCG Crossover is raising up to $900m for its second fund, in partnership with The Column Group, with a focus on crossover and public investments in life sciences companies, per an SEC filing.

• Jeff Hypes (managing director, ex-Credit Suisse Private Fund Group), Nick Ohler (director, ex-Houlihan Lokey) and Andrew Viehe (director, ex-Credit Suisse) joined William Blair’s private equity advisory team. www.williamblair.com

• Guantong "GT" Sun joined Turning Rock Partners as SVP of investor relations. He previously was with Pretium Partners. www.turningrockpartnerscom

• Rongjing Zhao joined Morrison Foerster as a China-based partner in the law firm's private equity and M&A groups. She previously was with Kirkland & Ellis. www.mofo.com

The U.S. economy added 236k jobs in March, in line with economist expectations.

• The unemployment rate ticked down to 3.5%. Average hourly earnings climbed 0.3% month-over-month, and 4.2% year-over-year. Combined revisions for January and February were 17k fewer jobs than previously reported. Labor force participation rose to 62.6%.
• The stock markets are closed for Good Friday, so investor reaction is nonexistent.
• Go deeper.

Crypto challenges aside, blockchain technology has become an attractive and unexpected M&A target.

Looking ahead: Understand the opportunities and challenges ahead for M&A with insights from RBC Capital Markets’ expert bankers on Strategic Alternatives, the RBC M&A podcast.

Listen now.

Thanks for reading Axios Pro Rata, and to copy editors Mickey Meece and Bryan McBournie! Please ask your friends, colleagues and newsletter writers to sign up.