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New in the News
Bolt, CenterBeam, ClickMovie.com, Coollogic, DigitalWork.com, Draper Fisher Jurvetson, eVentures Group, GOWAREHOUSE.com, HealthAxis.com, IMRglobal, internet.com, LanguageWare.net, MediaDNA, MediaSite, NeoCarta Ventures, OrderTrust, PacificNet.com, Placement 2000.Com, Predictive Networks, Scudder Kemper, Sequoia Software, SiliconLosAngeles.com, Ultrexx, Virage, WANTads.com, WebCriteria, WebEx, X.com, Xpede
EAST NORRITON, Pa.– HealthAxis.com, a subsidiary of Provident American Corp. (NASDAQ:PAMC) and a provider of Internet solutions for healthcare insurance marketing, sales and administration, announced that an investment group led by Brown Simpson Asset Management LL
C, has invested $57 million into the company. The Brown Simpson-led group includes the Royal Bank of Canada, LBI Group Inc., Tudor Investment Corp., and other investors. Several of the funding parties are previous investors in the private securities of either Provident American or HealthAxis.com. The investment group in this transaction will be receiving 3,846,003 shares of HealthAxis.com common stock.
In other news, HealthAxis.com and Insurdata Inc., a subsidiary of UICI (NYSE:UCI) and a large provider of healthcare administration software solutions, announced the signing of a definitive agreement to merge the two companies. The combined entity, which will retain the HealthAxis.com name, will be one of the largest players in the Web-enabled health insurance space, with proforma 1999 estimated revenues of $42 million. The transaction is scheduled to close in January of 2000, subject to satisfaction of various closing conditions, including regulatory and shareholder approval. Under the terms of the transaction, each company’s shareholders will end up owning approximately 50 percent of the newly combined company, on a pre-funding basis.
COLUMBIA, Md.– Sequoia Software Corp., a provider of interactive enterprise portals powered by XML, secured $33 million in third-round financing. The Baker Communications Fund led the round, in which Sequoia received investments from divine interVentures inc. and existing investors Anthem Capital, Mid Atlantic Venture Funds, and Flanders Language Valley Fund. Individual investors to the third round included Andrew “Flip” Filipowski, CEO, chairman and founder of divine interVentures, and Rick Faint, Sequoia’s CEO. Filipowski has joined Sequoia’s board of directors, as will Lawrence Bettino and Jonathan Grabel, both with the Baker Communications Fund.
CHICAGO– DigitalWork.com, an on-line “Do-It-Yourself” business agency geared toward the small office/home office market, completed a $32 million round of strategic financing that will be used to fund its rapid growth, expand its services suite and launch major marketing and advertising campaigns. To date, DigitalWork.com has raised $47.1 million in equity capital, including a second round of capital funding of $12.4 million in May 1999. Attractor Investment Management, a Burlingame, CA-based firm specializing in late-stage mezzanine financing, led the round. Initial financial investors, including Draper Fisher Jurvetson, TL Ventures and Information Technology Ventures, reinvested substantially in this round. The remainder of the financing came from strategic partners, including Office Depot, Inc. (NYSE:ODP); Mail Boxes, Etc., a wholly owned subsidiary of U.S. Office Products Co. (NASDAQ: OFIS); PurchasePro.com Inc. (Nasdaq: PPRO); Reckson Service Industries (Nasdaq: RSII); an affiliate of Office.com, a service from Winstar; and smalloffice.com LLC.
SAN JOSE, Calif.– WebEx, a company that powers meetings on the Web, secured $25 million in a round that includes investments from New Enterprise Associates, Walden International Group, Summit Partners Accelerator Fund and International Capital Partners as well as major corporations, including Deutsche Telekom. Joining WebEx’s board from this round are Scott Sendell from NEA and Som Das from Walden.
SAN JOSE, Calif. — Virage Inc., a leader in interactive video search products and application services, closed a strategic financing round totaling approximately $20 million, anchored by Reuters (Nasdaq:RTRSY) and Weston Presidio Capital. With this investment, Reuters and Weston Presidio join AltaVista, Adobe Ventures (a partnership with Hambrecht & Quist), Media Technology Ventures, NeoCarta Ventures, Sutter Hill Ventures and Trinity Ventures as primary investors in Virage.
LA JOLLA, Calif. — MediaDNA, a provider of comprehensive digital rights management solutions for the marketing, distribution and protection of content over the Internet, closed a round of financing totaling more than $9 million. Adams Capital Management led the round. MediaDNA’s solutions provide publishers a framework for protecting and managing content distribution over the Internet. MediaDNA’s solution is complemented with technology that allows protected content to be indexed by Internet search engines.
DALLAS– eVentures Group Inc. (OTCBB:EVNT), an Internet holding company focused on communications services, completed a $7 million round of financing from an investment group lead by Goff Moore Strategic Partners LP, a $150 million private equity and venture capital fund based in Fort Worth, Texas. Also investing in the round was Geronimo Partners L.P., an affiliate of EFO Holdings L.P., a Dallas-based investment firm. In the placement, eVentures issued 6,225 shares of Series B Convertible Preferred Stock. The Series B Stock does not pay dividends and is convertible into shares of eVentures Common Stock at a fixed conversion price that was calculated on the basis of the average closing bid price of eVentures stock over a ten-day period ending October 29, 1999. The proceeds will be used to fund venture capital investments that eVentures expects to make over the next few months and for general corporate purposes.
BOSTON — Predictive Networks Inc. received $6.5 million in financing from Battery Ventures. Predictive Networks provides a content delivery and analysis operating system for Internet Service Providers that utilizes a powerful yet anonymous set of profiling tools to deliver timely, preferred content in attractive formats. Along with this venture funding from Battery Ventures, Predictive Networks is in the process of securing an investment of $1.5 million in additional funds, bringing the total of this round of financing to $8 million. The additional funds will come from the firm’s original group of investors who, in May 1999, provided Predictive Networks with $800,000 in seed financing.
HOUSTON — WANTads.com Inc. secured a $6-million investment from Davis Holdings Technology Partners L.P. The company also retained Fulbright & Jaworski L.L.P. to represent it with its capital funding activities. WANTads launched its website earlier this year and is part of a network of online auction and classified websites numbering almost 100 companies. The company currently has more than 250,000 items up for sale or auction on its website.
PORTLAND, Ore.– WebCriteria Inc. secured a first round of financing totaling $5 million. SI Ventures, a GartnerGroup-affiliate based in Florida, served as lead investor for this round of financing, joining private angel investors and Shaw Ventures who provided seed round capital and are also participating in this round. New to WebCriteria’s board of directors is Dr. N. Adam Rin, managing director of SI Ventures. WebCriteria is the developer of an intelligent agent, Max, that simulates browsing behavior to determine how quickly and easily people can navigate web sites.
MINNEAPOLIS — US-based PacificNet.com, a business-to-business e-commerce service provider, received a US$4 million investment from China Strategic Holdings Limited (HKSE:0235). CSH, one of Hong Kong’s leading investment companies, and CSH’s Chairman Oei Hong Leong will acquire a 30% and 10% interest in PacificNet.com, respectively, with Oei becoming PacificNet.com’s new chairman.
DARIEN, Conn.–internet.com Venture Fund II, part of the affiliated venture arm of internet.com Corp. (Nasdaq:INTM), publisher of this website, announced the closing of investments in Psylum.com and NationalContractors.com. The investments are part of internet.com Venture Fund II’s expanding portfolio of early-stage investments in Internet content properties. Psylum.com is an online community for the hobby entertainment industry dedicated to collectible card games. NationalContractors.com is a construction contractor referral Web site, referring pre-screened contractors worldwide for commercial, residential and industrial type projects up to $100 million dollars in value.
LOS ANGELES– Zone Ventures, the Los Angeles affiliate of Draper Fisher Jurvetson, funded GOWAREHOUSE.com, a complete communications and inventory management service for e-tailers. GOWAREHOUSE.com provides a business-to-business Internet-based exchange hub, which fully integrates the systems between companies selling goods over the Internet and companies that perform the logistics functions. Draper Fisher Jurvetson and SunAmerica also participated in this round of funding. Financial terms were not disclosed.
SAN DIEGO– Venture-Catalyst.com, the venture capital and Internet consulting division of Inland Entertainment Corp. (Nasdaq:INLD), announced a strategic investment in Ultrexx (OTCBB:ULTX), a provider of intelligent Web site creation services and expert systems development for the Internet and Intranets. In conjunction with this strategic investment, Venture-Catalyst.com has entered into a one-year services agreement with Ultrexx to provide the company with investor relations and venture development serv
NEW YORK — Bolt Inc. closed a significant strategic round of investment from a group including Time Warner, Comcast Interactive Corp., Entercom Communications Corp., America Online and Ford Motor Company. Also participating were certain of Bolt Inc.’s original investors, including Highland Capital, Oak Investment Partners, Sandler Capital Management and Bechtel Enterprises. Leading these institutions in the current round was Moore Capital. Financial terms of the agreements were not disclosed. Bolt Inc. recently announced an agreement with America Online under which Bolt will develop and manage new community services for AOL Teens Channel.
PITTSBURGH — MediaSite Inc., a provider of technology and services that makes video interactive, announced a significant investment from Zero Stage Capital. Argent Partners, Birchmere Investments, Pernex Equity Investments Inc. and RRZ Private Equity fund also participated in this round. MediaSite offers a total, integrated solution through its Publisher Suite and services to deliver a flexible, automated approach for publishing searchable video on the Web.
Internet Fact of the Day
While a majority of leaders of consumer and industrial market companies believe that e-commerce is critical to their ongoing success, most companies do not have comprehensively funded e-business strategies, according to a recent study sponsored by KPMG. Moreover, the funded initiatives that exist tend to be tactical initiatives within a function, rather than strategic initiatives within an enterprise, the study said.
REDWOOD CITY, Calif.– Draper Fisher Jurvetson, an early stage venture capital firm, announced the formation of a new $500 million venture fund. The first fund with meVC, which DFJ funded with $4.5 million, is set up to fund private Internet start-ups throughout the United States with the help of the Draper Affiliate Network. The Draper Affiliate Network currently includes Zone Ventures of Los Angeles, Draper Atlan
tic of Northern Virginia, Draper Triangle of Pittsburgh, Pa., Wasatch Ventures of Salt Lake City, Timberline Ventures of Vancouver, Wash., and the yet unnamed New York City office. The network is growing at the rate of one new fund per quarter.
meVC, a national venture capital investment management firm, offers individual investors the opportunity to participate in venture capital investing. Through a family of professionally managed, diversified venture capital funds, meVC intends to provide individual investors unprecedented access to early-stage, emerging growth companies before their initial public offerings.
meVC’s venture capital portal, meVC.com, is intended to enhance interaction between investors, fund managers and entrepreneurs. meVC was founded in June 1999 and completed its second round of venture financing in October 1999.
CAMBRIDGE, Mass. and SAN FRANCISCO — NeoCarta Ventures Inc. announced the closing of its first fund. The $275-million fund will be used to invest exclusively in the area of Internet commerce: business-to-business, consumer-related and enabling technologies and services. NeoCarta Ventures’ managing directors are D. Jarrett Collins, Karin Kissane, Thomas W. Naughton, and Tony J. Pantuso. Collins and Kissane were previously principals of TTC Ventures, the venture capital arm of The Thomson Corp. Naughton and Pantuso were formerly vice presidents at GE Equity, the private equity subsidiary of General Electric Capital Corp.
MARINA DEL REY, Calif., — Garrett K. Krause, president and CEO of SaraOnline.com Inc., the Internet focus subsidiary of Sara Hallitex Corp. (OTCBB:SHAL), announced the establishment of SiliconLosAngeles.com, the company’s initial venture into providing fully comprehensive incubator facilities for new, emerging growth high tech companies, projects and technologies operating in the Internet industry. SiliconLosAngeles.com is the first of five planned global incubator units.
BOSTON — Scudder Kemper Investments Inc. announced the launch of Scudder Kemper Investments E-cubator Group, which was established create e-businesses, enhance the value of existing e-businesses and serve as a center of excellence for e-business activities. Also announced was the appointment of Jay Kingley as managing director and head of the newly established group. Kingley joins Scudder Kemper from Diamond Technology Partners, where he was a partner responsible for its financial services e-business strategy practice.
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LAS VEGAS– American Vantage Companies (NASDAQ:AVCSD) announced that it has completed the acquisition of an 80% interest in Placement 2000.Com Inc. for $1 million in cash and up to an additional $2 million in cash, based on future earnings, to be used for Placement 2000’s general corporate purposes. Placement 2000 is a privately held Internet concern specializing in online services for information technology professionals, companies, and recruiters. AVCS granted options to Placement 2000’s former principal, who is remaining with the company, to purchase up to 333,334 shares of AVCS common stock.
COLORADO SPRINGS, Colo. — LanguageWare.net Ltd., (OTCBB:LWNTF, LWNUF) announced that a letter of intent was signed to exchange 100% of Star+Globe Technologies Pte. Ltd. Shares for $7,500,000 in LanguageWare.net stock. Star+Globe Technologies is a closely held Singapore company that provides proprietary Asian character processing technology. The transaction will give LanguageWare.net a competitive advantage in developing multilingual web sites and e-business solutions for customers serving Asia from around the world. It is anticipated that LangaugeWare.net will exchange all of the outstanding shares of Star+Globe for 35,715,000 LanguageWare.net ordinary shares representing $7,500,000 based upon a per share price of $0.21 which was the 20 day moving average as of Dec 3, 1999. Additionally, LanguageWare.net raised $1,000,000 concurrent with entering into the letter of intent with Star+Globe through the issuance of a convertible debenture to Lernout & Hauspie Speech Products (Nasdaq: LHSP). The completion of the transaction with Star + Globe will also complete all milestones for an additional $1,500,000 investment in LanguageWare.net ordinary stock by Vulcan Investments, Inc. of Denver, Colorado, pursuant to an agreement signed in June 1999.
CLEARWATER, Fla. — IMRglobal Corp. (Nasdaq:IMRS), a global provider of e-business and information technology solutions, acquired Neverdahl-Loft & Associates Inc., a full-service information technology consulting firm focused on the life insurance industry. IMRglobal paid approximately $10 million in cash at closing for all of the outstanding stock of Neverdahl-Loft. The agreement also calls for certain contingency payments to be paid in calendar year 2000 if Neverdahl-Loft achieves specific targets. IMRglobal will account for the acquisition as a purchase and expect
s the acquisition to be accretive to earnings in calendar year 2000.
DALLAS — Coollogic, an end-to-end solutions provider of privately-branded Internet-ready appliances and software systems, entered into an agreement to acquire the assets of ON Channel Inc., an emerging developer of embedded Linux open source software solutions for Internet appliance manufacturers and OEMs. Terms were not disclosed.
Who’s Who & Where
LOWELL, Mass.– OrderTrust, Inc., a provider of integrated order management services for e-commerce, announced the appointment of Robert Aldrich to the position of chief financial officer. Aldrich will direct OrderTrust’s financial and legal operations, including risk management, banking relationships and the development and execution of the organization’s financial strategies. Prior to joining OrderTrust, Aldrich was vice president and corporate controller at The Learning Company of Cambridge, Mass. In September, OrderTrust closed investment rounds led by Fingerhut Companies and Far West Capital Management.
SAN FRANCISCO– ClickMovie.com, a leader in movie-on-demand technology, announced that entertainment and electronics industry veteran, Ted Hoff, has joined its parent company, Tranz-Send Broadcasting Network Inc., as its chief operating officer. Hoff comes to Tranz-Send Broadcasting Network from senior management positions with Time Warner, Atari, SEGA and Twentieth Century Fox. The company recently completed an equity round of financing.
PALO ALTO, Calif. — Former Intuit CEO Bill Harris has been named president and chief executive officer of X.com Corp. X.com, which will launch its public site later this week, will initially provide access to online banking services and a low-cost family of index mutual funds. The companyrecently received venture funding from Sequoia Capital.
OAKLAND, Calif. — Xpede Inc., a provider of online mortgage loan solutions, announced that John G. Lettko has joined the company as president. Lettko was most recently managing director, global operations at EDS. He joins new members of the Xpede team, Ken Elmer, vice president of finance and administration and Stuart Thompto, vice president of engineering. The company is funded by Mayfield Fund, Rosewood Capital and Arbor
SANTA CLARA, Calif. — CenterBeam Inc., a provider of enterprise level services to small business, announced that Sam Reese has joined the company as vice president of sales. Reese joins CenterBeam from Corporate Express where he was vice president of sales and marketing. Previously, he held executive and management sales positions at Kinko’s Inc., British Telecom, and Xerox Corp. The privately held company investors include CrossPoint Venture Partners, Accel Partners, NEA, Microsoft Corp. and USWeb/CKS Corp.
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