RealTime IT News

ePrize Leaves Rare Medium, Grabs New Funding

Flush with new cash, online sweepstakes ASP ePrize said it's parting ways with its incubator, Alley play Rare Medium.

The Farmington Hills, Mich.-based ePrize said it had secured a $2 million round of equity funding from undisclosed private investors.

Through the transaction, ePrize will no longer be part of the Rare Medium Group, although it confirmed that Rare Medium would maintain an undisclosed stake in the company. Previously, Rare controlled 80 percent of the firm's stock.

Spokespeople declined to disclose more specific terms of the deal.

"This is an exciting event for both ePrize and Rare Medium," said ePrize chief executive Josh Linkner. "It validates the strength of our company in our ability to raise capital in these challenging economic conditions."

Rare Medium did not return repeated phone calls. However, Linkner said the parting of ways spoke well of Rare's prowess as an incubator: "They have proven their ability to transform business models into companies with substantial business value," he said.

Since December 1999, Rare Medium has provided incubator services to ePrize including office space, strategic planning, and human resources, accounting and legal support. Now, following its new investment, ePrize says it plans to take over these services.

"The investment and resources provided through Rare Medium were instrumental in our growth from a small startup to a successful marketing technology company" Linkner said. "We are in a new stage in the lifecycle of our company and this agreement gives us the opportunity to continue our remarkable growth."

ePrize, which also has offices in New York and San Francisco, says investors were interested in its client roster, which includes names like Hewlett-Packard Co., MasterCard International and General Motors.

Remaining firms in Real's incubator basket include e-marketplace technology firm LiveMarket, Web marketing firm Regards.com, music publisher CMJ Network, and telephony firm NoticeNow.com. Rare has stakes 74 percent or larger in each of the companies.