VC Buzz – $208.6 million in today’s deals

BOULDER, Colo –Novazen, Inc., a Boulder, CO-based vendor of Internet-based customer relationship management, electronic bill presentment and payment, and bill consolidation announced a $20 million investment from Columbia Capital, Rho Management Company, Bessemer Venture Partners, Cedar Grove Investments and other existing investors including Meyer, Duffy & Associates. Novazen has developed an advanced customer care product suite designed to redefine and improve the interaction between businesses and their customers via the Internet. The customer care market, which is estimated to hit $3 billion next year, is projected by International Data Corporation to become as large as $11 billion by 2003.

Rare Medium enables and builds next generation online businesses, and with $87 million in capital raised from the Apollo investment group, Rare can now take equity stakes in companies that benefit from its award-winning Web development services.

As a result of this financing and the exercise of employee stock options, DataMirror’s share of the issued capital of PointBase has decreased to approximately 29% from 42%. DataMirror expects to record a non-cash gain of approximately $2,000,000 in its third quarter financial statements relating to its ownership dilution arising from the issue. The gain is not subject to income taxes.

This financing was led by JK&B Capital, a $220 million venture capital firm based in Chicago. Charles Wang, Chairman and Founder of Computer Associates International Inc., is a founding limited partner in JK&B Capital, and Soros Group is a special limited partner, making its organization and resources available to the venture firm. Also participating in this round of financing are AVI Capital and Aspen Ventures, both of Los Altos, CA. Aspen and AVI both specialize in early-stage investments in high-technology companies positioned for breakout performance in high-growth segments of the information technologies market.

SAN JOSE, Calif.–Blue Sky Research (BSR), a privately held innovator of proprietary electro-optics technology, announced the initial close of a financing round led by one of the world’s leading providers of multimedia products and peripherals for personal computers.

In this round, Blue Sky Research raised approximately $12M from multiple investors, including venture capital, institutional and strategic participants. The funding will enable BSR to extend product development into the next production phase, and will help position BSR as a leader in high-performance optical drive technology for the data storage industry.

“I see a great future for optics technology within the information industry,” said Al Shugart, member of the Blue Sky Research Board of Directors and president and CEO of Al Shugart International, an investor in this financing round.

SAN FRANCISCO– Listen.com, one of the fastest growing Internet music companies announced three new investors, completing a $25 million private equity placement. This round of funding for Listen.com, the Internet’s comprehensive directory to downloadable music, was led by the Barksdale Group and included Hambrecht & Quist’s investment arm Access Technology Partners, L.P. and Sony Music Entertainment.

With this most recent round of funding, Listen.com has raised a total of $35 million this year. Other Listen.com investors, including Altos Venture, August Capital, Austin Venture, CNET CEO Halsey Minor and Gateway Computers CEO Ted Waitt also participated in this round of financing.

The company was founded in December 1998 by Robert Reid, a former venture capitalist and author of “Architects of the Web.” Listen.com was seeded by Altos Ventures and three prominent Founder/CEOs: Chris Anderson, Imagine Media; Halsey Minor, CNET; and Ted Waitt, Gateway Computers.

E.M. Warburg, Pincus & Co. LLC and its affiliates comprise a specialized financial services organization that manages $7 billion of investments in its private equity investing activities, with a further $4 billion available for investment.

CONSHOHOCKEN, Pa– Founded in June 1999, Half.com announced it has secured $2.5 million in its second round of financing.

Half.com is led by former Infonautics co-founder Joshua Kopelman and Sunny Balijepalli, also from Infonautics. The company has quickly attracted twenty Internet “veterans” who have worked for such companies as America Online, CDnow, N2K, Oracle Corporation, Spree.com, MetaCreations and VerticalNet to round out its development and marketing teams.

DENVER– Stolberg, Meehan & Scano II L.P., a private equity investment firm, announced it has teamed with Bain Capital Inc. to provide an equity commitment of $75 million to Advanced Telecommunications Inc. (ATI), an Integrated Communications Provider of voice and data products and services that is based in Minneapolis, Minnesota. Stolberg and Bain Capital will each have two seats on ATI’s Board of Directors.

In addition, General Electric Capital Corp. is providing $65 million in senior secured debt financing.

Stolberg’s Denver office makes equity investments in business-to-business service companies. Stolberg’s New York off ice, through SMS Brands, is specifically focused on consumer branded foods company investments. The private equity firm manages $170 million of committed capital.

SAN DIEGO–Internet Products Inc., a provider of turnkey Internet servers and Internet access monitoring and control appliances, announced that it has successfully completed its first round of private funding in the amount of $1.6 million from a group of private individual investors led by Torrey Pines Securities as sole placement agent.

Western Multiplex is a provider of broadband wireless solutions used in Internet infrastructure whose customers include AT&T Wireless, Nextel, Sprint PCS, AirTouch and Deutsche Telekom. Previously, Glenayre had announced plans to sell Western Multiplex. The sale will allow Glenayre to better align with the most appropriate markets for Glenayre’s strategic objectives.

Ripplewood Holdings L.L.C, founded in 1995, is a New York-based private equity firm with $430 million of committed capital.

Leeward Technology Partners is Ripplewood’s Industrial Partnership with Jonathan Zakin which pursues investment opportunities in communications and computer technologies.

PALO ALTO, Calif– Mercado Software Inc., a pioneer of online catalog integration and search, announced the closure of a $12 million round of financing. The monies come from the company’s original Israeli investors plus new investments from US-based Eucalyptus Ventures and Access Technology Partners, two funds affiliated with Hambrech & Quist, San Francisco. The new round positions Mercado to aggressively market, sell, and support its electronic catalog software into business-to-business, business-to-consumer, and online procurement markets.

NEW YORK– MicroCast Inc., an innovative Internet video streaming company, announced that the company has raised $13.5 million in its first round of financing.

Led by J&W Seligman, additional investors include Redcoat Capital Management, the Galleon Group, Blue Ridge Capital L.L.C., and Blair Asset Management Corp. MicroCast has retained Lehman Brothers for its second round of financing.

MicroCast, founded in early 1998, will provide content partners with a turnkey video streaming service, advertisers with unparalleled one-to-one relationship marketing capabilities and consumers with television programming on demand. MicroCast will be launched in the fall of 1999.

SAN FRANCISCO, — Evolve Software, a provider of Internet-based solutions for Professional Services Automation (PSA), announced it has closed $25 million in its mezzanine round of venture funding led by investment firm Goldman, Sachs & Co. The round, which was over-subscribed despite being expanded to accommodate enthusiastic investor response, includes investments from Deutsche Bank Alex Brown, SunAmerica Ventures, Citicorp and Whitman Capital. Previous investors Sierra Ventures and Altos Ventures also participated in this round.

Internet Fact of the Day

PALO ALTO, Calif. — Responsys.com, an application service provider (ASP) for permission marketing on the Internet, announced that ReleaseNow.com, a provider of outsourced e-commerce solutions for software publishers and online retailers, is using the Responsys.com system.

ReleaseNow.com creates, hosts and manages electronic stores for software publishers and retailers that sell and deliver products over the Internet. A key service provided by ReleaseNow.com to its customers is the e-Campaign(TM), a sophisticated e-marketing service designed to drive traffic to the online stores of ReleaseNow.com customers and build loyalty between vendors and online shoppers. Responsys Interact serves as the “backbone” technology component of the ReleaseNow.com e-Campaign service.

Privately held, the company is based in Palo Alto, Calif., and is backed by top-tier investors including Accel Partners, Foundation Capital and executives from leading Internet companies. Major customers include e-Bay, ChipShot.com, Network Associates, Verisign and Virgin.

Broadband Partners will establish headquarters on the West Coast later this year. Management for the company has not yet been identified.

AnyDay.com Inc. is backed by venture capital firms SOFTBANK Technology Ventures and Carlyle Venture Partners.

NEW YORK–On-Link Technologies Inc., a leader in business-to-business Web sales and marketing applications, unveiled the “Web Office” — the next frontier of business-to-business e-commerce.

The Web Office represents a virtual space where companies and their customers interact through a new breed of Web sales, marketing and service applications. These new applications focus on automating processes in the customer’s lifecycle, from awareness through repurchase, for increased top-line growth and cost savings. This perspective is a major shift from established front and back office applications that automate internal processes to improve bottom-line savings.

On-Link is a privately held, venture capital-backed company located in Redwood City, California.

SANTA CLARA, Calif.– XACCT Technologies Inc. announced that it is offering a Platinum Support Plan to provide optimum support coverage, on a worldwide basis, to the growing array of carrier-class Integrated Communications Provider (ICP) customers that use its XACCTusage(TM) IP mediation system.

XACCT develops a new class of intelligent software solutions that enable Service Providers and enterprises to accurately account and bill for metered services and applications.

A privately held corporation, XACCT is funded by venture capital investors.

MarketSoft Corporation, headquartered in Lexington, Mass., is a supplier of eMarketing software. MarketSoft’s investors are Prism Venture Partners, Canaan Partners, BancBoston Capital, Advent International and Integral Capital Partners.

Under the agreement, Corcoran real estate agents will use bamboo(TM) Virtual Tours exclusively on their Web site, corcoran.com. Corcoran real estate agents will have bamboo Virtual Tours delivered to the Corcoran Web site as well as to REALTOR.com, HomeSeekers, Microsoft HomeAdvisor, HOMES.com and CyberHomes. The virtual tours allow home-shoppers to view indoor and outdoor areas in all directions.

Based in Palo Alto, CA, bamboo.com is a premier provider of Internet-based 360-degree virtual tours for the real estate community. Company investors include Intel Corporation, Trident Capital, the Walden Group and VantagePoint Venture Partners.

SANTA MONICA and CUPERTINO Calif.– PeopleLink, a provider of outsourced, community communications services for the Internet, and Lipstream, a leader in live voice for eBusiness, announced a strategic technology and marketing alliance designed to make Lipstream’s live voice communications an integral component of the PeopleLink community suite.

Lipstream’s live voice service has been fully integrated into PeopleLink’s community solutions which includes text chat, instant messaging, PORCH light (the PeopleLink Online Ready to CHat presence indicator), message boards, instant messaging, member directories, mailing lists and interest groups. Lipstream’s live voice technology is initially available as a component of PeopleLink’s Instant Messaging Java applet and downloadable client.

Lipstream is an Internet voice service provider for eBusiness. Lipstream enables live voice communication for e-commerce, customer service, education, entertainment and community applications. Lipstream is privately held and venture-backed by Sequoia Capital.

SAN FRANCISCO –Robertson Stephens announced that senior Internet analyst Keith Benjamin will be leaving the firm to join Highland Capital Partners as a general partner.

He will continue to play a significant role in Robertson Stephens’ Internet investment research Web site, Internetstocks.com. In addition, the two firms announced that they are exploring a strategic marketing relationship to further develop Internetstocks.com.

SUNNYVALE, Calif–Resonate Inc., a provider of high availability and high performance solutions for e-business applications and services, announced three additions to the Resonate team, filling out the company management team and expanding the board of directors.

Bob Hausmann and David Guercio join the company’s management team as CFO and vice president of professional services, respectively. Hausmann previously held the position of CFO and administrative partner at Mohr Davidow Ventures, where he coordinated fund raising for the firm and served as an interim operating executive for several portfolio companies. Before his tenure at Mohr Davidow Ventures, Hausmann served as vice president and CFO of Red Brick Systems.

A privately held corporation headquartered in Sunnyvale, Resonate has received investments from Kleiner Perkins Caufield & Byers Java Fund, Chase Capital Partners, Intel Corporation, Flatiron Partners, Lehman Brothers, TechFund and Charter Venture Capital.

SAN JOSE, Calif–FastParts.com, a business-to-business internet-based trading exchange and marketplace for the electronic parts industry, has moved its corporate headquarters from Chicago to San Jose, California. The move is a consolidation of marketing, customer service and technical operations by the company, and marks FastParts.com’s transition into a high growth phase.

FastParts.com is a members-only, end-to-end, e-commerce service provider leveraging the Internet to deliver Trading Exchange, Auction, and Shopping Mall venues for companies in the electronics manufacturing vertical market. The company provides buyers and sellers with anonymity, manages the process, and receives a fee for each completed transaction. The privately held company is venture capital backed by Draper Fisher Jurvetson, SoftBank Technology Ventures, and Gabriel Capital.

WESTWOOD, Mass–ShopLink.com, an on-line provider of grocery shopping and household services, announced the appointment of Joshua D. Kruger as Executive Vice President of Operations. ShopLink.com recently completed a $14 million private placement equity financing led by Soros Private Equity Partners LLC.

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