Venture
Update Vol VI, #7, October 2002
RTP - Hatteras Networks (www.hatterasnetworks.com), a developer of Ethernet technology for fiber-optic and copper lines, raised $45 million in September. The investment was led by Grotech Capital Group and included Bessemer Venture Partners, Columbia Capital and ComVentures. Hatteras is developing a technology platform that allows carriers to offer Ethernet data services on their existing networks without trenching new fiber. Hatteras, which has raised more than $73 million to date, will use the funding for carrier product trials, development, and sales. Contact: Tom McPherson (919.991.5463).
Durham - Serenex Inc. (www.serenex.com), a biotechnology company, raised $15 million in its second round of venture capital. Intersouth Partners led the round, which also included investments from BioVentures, Seaflower Ventures and Mediphase Venture Partners. Founded in 2001, Serenex is developing technologies that allow discovery, lead identification and toxicity profiling of drug targets to be performed at the same time. The company's goal is to accelerate drug discovery and reduce the probability that drugs will fail in clinical trials after significant investments have already been made. Contact: Robert Dishman (919.281.6001).
RTP - Overture Networks (www.overturenetworks.com), a developer of technology for delivering voice and data services over metro networks, secured $15 million in its second round of financing. New investor Morgenthaler Ventures led the round with first time investments from Armada Ventures and Intersouth Partners. Gray Ventures and other existing investors also participated. To date, Overture has raised a little over $18 million. Contact: Jeff Reedy (919.558.2200).
Cary - LVL7 Systems (www.lvl7.com), a networking software company that accelerates the development of network infrastructure equipment, secured $12.5 million in an oversubscribed, Series B funding round. Gabriel Venture Partners, of Redwood Shores, CA, and Annapolis, MD, and H.I.G. Ventures, of Atlanta, GA, jointly led the round. The company received $8.5 million to fuel its drive to profitability and expand its sales and marketing initiatives. An additional $4 million is available to the company based on growth requirements and expansion plans. Contact: Ernest Baker (919.865.2730).
Cary - HiddenMind Technology, LLC (www.hiddenmind.com), provider of mobile software for Active Technology Enhanced products and services, received an additional $10 million in new investment from the JLT Group, a Minnesota-based investment firm. The company's technology allows systems integrators and application developers to add mobile capabilities to their own products. Other investors in the company include Warburg, Pincus & Co, BEA Systems and GreenSpring Ventures. Contact: Ken Walters (919.459.2000).
Cary - Pinpoint Networks, Inc., (www.pinpoint.com), a provider of software and services to global mobile operators, closed on $8 million in venture funding, led by new investor Massey Burch Capital and current investors Noro-Moseley Partners and Wakefield Group. Other investors in this round include the Atlantis Group and Tri-State Investment Group. Contact: Jud Bowman (919.677.7100).
Morrisville - TEAMM Pharmaceuticals (www.teammpharma.com), a specialty pharmaceutical company, raised $6.5 million in Series A round financing. The round was led by Harbert Management Corporation, and followed by investments from Hopkins Capital, TEAMM's angel investors and founders. The funds will be used for working capital to support the companies' recent acquisition of the HistexTM line of cough, cold and allergy products. TEAMM presented at CED's Venture 2002 conference in April; it was there that they developed their relationship with Harbert Management Corporation. Contact: Martin Baum (919.481.9020)
Morrisville - FormScape (www.formscape.com), a provider of enterprise information delivery technologies, received $5 million in second round venture capital funding. The funding was led by London-based MTI Partners, which first invested in FormScape in 2000. Founded 12 years ago, FormScape provides XML-based software that enables the delivery and exchange of electronic documents between an organization's customers, suppliers and employees. FormScape had revenues of $9.3 million last year. The funding will be used for marketing and sales. Contact: Malcolm Peden (919.657.1100).
Raleigh - Oculan Corporation (www.oculan.com), a provider of network and system management services to value-added resellers, management service providers, system integrators, and IT outsourcers, closed a $5 million Series C round. Soros Private Equity Partners of New York led the round. The Series C funding will enable the continued expansion of Oculan's sales, business development, technical support, and marketing operations as the company expands market share and builds on the success of its inaugural year. Contact: John Beletic (919.534.0500).
Raleigh - Encelle, (www.encelle.com) a biotechnology firm, landed two-thirds of a $6 million infusion of venture capital and a development partner for its lead product, an artificial tissue to aid in treating wounds. Intersouth Partners of Durham, the North Carolina Enterprise Fund of Raleigh and New Orleans-based Koerner Capital, have put $4 million into Encelle's fourth funding round. All three have previously invested in the company, which has raised $23.6 million to date. According to a company spokesperson, other investors have agreed to put another $2 million into the company by the end of the year. Contact: James Woodward (919.877.8101).
RTP - Ziptronix (www.ziptronix.com), a developer of semiconductor bonding technology, raised $3.5 million. Ziptronix spun off two years ago from the Research Triangle Institute (RTI), which along with Alliance Technology Ventures provided the new funds. Ziptronix expects to raise additional funds for its second round of venture capital, targeting a total of $12 million. The company employs 22 people. Contact: Doug Milner (919.485.5300).
Chapel Hill - Zoom Culture (www.zc.tv/index2.asp), a new media company that specializes in producing and distributing digital video content for television and the Internet, raised $2.5 million in a third round of funding to help it speed up its movement into the conventional TV market. The new investment came from Intersouth Partners, Cordova Ventures, and Chrysalis Ventures -- all existing backers of Zoom Culture. The company recently signed a deal with a group of NBC television stations to produce a series of shows based on Zoom Culture's "Hip Hop Nation," which first aired in Raleigh last year. The company has raised a total of about $15 million. Contact: Marty Lafferty (919.960.9100).
Raleigh - Micell Technologies, Inc. (www.micell.com), developer of comprehensive carbon dioxide (CO2) process-technology solutions, completed a $2 million financing Round. The round included many previous investors and was led by Invemed Associates, Inc. of New York. A large portion of the company's shareholders also participated in the round. Micell's technology is the basis for environmentally friendly Hangers Cleaners. Contact: Kirk Kinsell (919.313.2109)
VC Profile
Glenn Kline
Managing Partner, Academy Funds
Contact info:
920 Main Campus Drive, Suite 400, Raleigh NC 27606.
Phone: 919-424-3777 or 919-993-3100. Email: gkline@academyfunds.com
or glenn.kline@siliconsemi.com.
How did you become a VC?
BA from Pomona College, MBA from UCLA. After
completing my MBA, I was fortunate to be hired in
1988 as an Associate by an established venture fund
in Southern California.
Number of companies invested in, and average
investment:
27 (with one "on the way"); $500,000.
Kinds of companies you invest in:
Since we typically invest before there is a company
formed, I look for technologies that can have a
positive impact on humanity founded by accomplished
researchers with a proven record of innovation.
Kinds of companies you avoid:
Technologies without strong intellectual property or
proprietary know-how.
Stage usually invest in:
Pre-seed
What's your best deal? Why?
Two are tied: Silicon Semiconductor & Pilot
Therapeutics. In both companies I have had the honor
of working closely with leading founders and helping
them grow their businesses (including serving as the
President/CEO of Silicon Semiconductor and Chairman
of Pilot).
What's your worst deal? Why?
Auto Parts Club (while in CA). It offered no added
value to society.
What company do you wish you had invested
in?
Qualcomm (also when I was in CA). We could not get
into the syndicate.
What kinds of deals are you looking for right
now?
Given our focus on university research and
diversified portfolio strategy, we are open to any
advanced technologies (e.g., life sciences, advanced
materials, semiconductors, etc.).
InfoTech 2002
October 30, 2002
Sheraton Imperial
RTP, NC
www.cednc.org/infotech/2002
Money & Markets 2003
February 7, 2003
Sheraton Imperial
RTP, NC
www.cednc.org/mm/2003
For more information, visit the CED Web site (www.cednc.org) or call 919.549.7500.