New in the News
Aeneid, BenefitMall.com, BrainBuzz.com, Bungo.com, burst.com, Burst! Media, Capital Markets Group, CarsDirect.com, CitiKey, CompuBank, eduTest.com, Edventions, Flight Time, Geneva Venture Partners, Internet Wire, iWaterways.com, Keystone Venture Capital, LaunchCenter 39, Macromedia, NerveWire, Net Value Holdings, NextOffice.com, OpenAvenue, perfumania.com, Petopia.com, PropertyFirst.com, Star One, theDial.com, Ticketmaster Online-CitySearch, TradeAccess, U.S. Interactive, Utilicom Networks
New in the News
FRANKLIN, Mass. — Utilicom Networks, a provider of bundled communications services under the TOTALink brand name, announced a commitment of up to $100 million by affiliates of Blackstone Capital Partners III. Utilicom builds and operates advanced broadband communications networks in partnership with local electric and gas utilities to deliver voice, video, Internet and data services to business and residential customers.
FRANKFURT, Germany– Star One AG closed its second round of funding, raising Euro 72 million (about $72 million) in equity. This round was led by Incepta International, a telecommunications development and investment firm backed by Bechtel Enterprises Holdings. Additional major investors include Providence Equity Partners Ltd, GE Capital, and Texas Pacific Group. Other investors include Viventures, TeleSoft Partners and Dresdner Kleinwort Benson. Star One AG has started to establish a Point-to-Multipoint wireless broadband telecommunications network that will offer customers ‘last mile’ broadband connectivity. Star One will provide its targeted customers with a variety of individual and bundled high-quality services at competitive prices, including high-speed data transport, Internet access, local and long distance voice services, and other enhanced communication services such as e-commerce.
DALLAS — BenefitMall.com, an online marketplace for small business employee benefits, received $40 million in venture capital funding, enhancing the company’s position as a player in the business-to-business online insurance marketplace. Technology Crossover Ventures led the recent round of financing, and was joined by new investor Morgan Stanley Ventures as well as existing investor Austin Ventures. The company currently manages more than $400 million in active insurance premiums for small businesses and helps independent brokers sell more than $500,000 Internet-enabled premiums each day. BenefitMall.com was originally a wholly owned subsidiary of Humana, one of the nation’s largest publicly traded health insurance companies.
HOUSTON — CompuBank, the first Internet national bank, received $36 million investment in its first institutional round of financing led by Softbank Finance with GE Financial Assurance, The Goldman Sachs Group and Marsh & McLennan Capital participating. CompuBank, Member FDIC, offers a variety of depository products and services to both businesses and consumers. By targeting Internet users, CompuBank has experienced over 100% quarter-to-quarter growth in its account acquisition over the past 12 months.
SAN FRANCISCO– Aeneid Corp. closed $32 million in new financing led by J. & W. Seligman & Co. The round includes strategic investments from Winstar (Nasdaq:WCII), Earthweb (Nasdaq: EWBX), and the CEOs of Columbia House, Brightpoint, and Escient. The current round of financing brings the company’s total private equity funding to more than $47 million. Aeneid is a provider of industry-specific search, monitor and notification infrastructure for business-to-business web destinations.
HOUSTON– iWaterways.com secured $21 million in first-round financing from James Ventures, private investors and The Alpert Companies. iWaterways.com is developing a community-based portal that will enhance the boating and water-sports lifestyles through interaction with experts, clubs and other members, and provide access to marine articles and databases.
SAN FRANCISCO– Instant Video Technologies (OTC:IVDO) closed a $19 million round of financing involving Special Situations Fund, Chelsey Capital, Ravinia Capital Ventures and BayStar Capital. The round was comprised of approximately $14 million in cash and the conversion of outstanding notes totaling $5.3 million. The company also announced that it changed its name to burst.com. The company’s Burstware product provides high-quality delivery of full motion video and CD-quality audio over any IP-based network.
LOS ANGELESInternet Wire, an Internet-based distributor of direct company news and online business communications materials, closed its first preferred round of venture capital, a total of $17.5 million, led by Sequoia Capital and Hummer Winblad Venture Partners. Also participating in the Series A round were first-round investors Osprey Ventures, Montreux Equity Partners and Mindful Partners, as well as Stanford University’s Daper Fund and Perkins-Coie LLP.Ann Winblad, partner, Hummer Winblad Venture Partners; Sameer Gandhi, Sequoia Capital; and Stuart Rudick, partner, Mindful Partners joined the board of directors.
BURLINGTON, Mass.– Burst! Media, an ad network for specialty-content web publishers, closed a $15 million round of private equity financing, exclusively led by Summit Partners. Burst! offers customized advertising solutions and ad management technology.
CANNES, France– CitiKey, a developer of city guide applications for the Wireless Application Protocol platform, received a new round of funding which will allow the company to more rapidly deploy its services to European cities. The new $11.5 million investment will enable the CitiKey to continue to develop mobile city guides that can help users access vital, personal, location-specific information, and launch guides in a dozen cities in the coming 12 months. The new funds have been secured from lead investors Crescendo Ventures, along with Atlas Venture and Kennet Capital.
SAN FRANCISCO and MENLO PARK, Calif.– NextOffice.com, a new online destination for business furnishings, secured a $10 million round of financing, led by the CMGI @Ventures B2B Fund. CMGI @Ventures joins The Phoenix Partners and Venture Frogs in funding the development of a comprehensive business-to-business e-commerce solution for business furnishings. Josh Daniels of CMGI @Ventures is taking a seat on NextOffice.com’s board of directors.
SAN FRANCISCO– On the heels of last week’sfinancing and strategic partnership with NBC and ValueVision (NASDAQ:VVTV), Petopia.com, an online pet store, raised an additional $10 million in cash from Greyrock Capital. In December 1999 Petopia.com raised $35 million. Petopia.com provides all things pet-related, from food, grooming and healthcare products to community forums and expert advice.
CHICAGO– Edventions, an education technology firm, secured $8.8 million in its third round of financing. Institutional investment comes from River Cities Capital Fund of Cincinnati, Ohio, and M Group Inc. of Birmingham, Michigan. Private investors included nationally prominent business leaders, celebrities and education proponents, according to the company. Edventions developed the Starship School on-line communications and learning system that debuted in Chicago area schools in Fall 1999. This round of financing will fund the national rollout of Starship School and its related programs to 500 schools in targeted regions.
RADNOR, Pa. — Cross Atlantic Technology Fund, a $150 million venture fund focused on investments in information technology companies in the United States, Ireland, and England, closed an investment in TradeAccess. XATF is the lead investor in a fully subscribed $5 million round. Cross Atlantic will have two board seats that will be filled by Glenn Rieger, managing director of XATF, and Scott Sill, an associate. TradeAccess provides next generation B2B software that facilitates complex, negotiated e-commerce.
PROVIDENCE, R.I. — Bungo.com, a provider of Internet enabled mobile information management solutions, completed a $2.5 million “post-seed” round of investment. Stuart Fullinwider, Edward Grace, Paul Kazarian, and Matthew Lorentzen were named to its board of advisors. Bungo.com offers a web-based personal desktop environment with a sophisticated information sharing infrastructure.
NORFOLK, Va.– Waterside Capital Corp. (Nasdaq:WSCC), a small business investment corporation, announced its December 1999 investment of $1.5 million in Capital Markets Group located in Sarasota, Florida. Capital Markets Groups operates www.WorldFinanceNet.com, a content driven, financial and investment information Internet site for individual on-line investors.
FAIRFAX, Va.– BTG Inc. (Nasdaq:BTGI), an information systems and technical services company, has made an investment of $250,000 in eduTest.com, an Internet-based company that provides testing and assessment services to educators and parents for state-mandated K-12 academic standards.
SEATTLE– Guide Ventures and a consortium of investors completed a second round funding for the theDial.com, a premier source of private labeled audio for the web. Joining the funding consortium are Vantage Point Venture Partners and first round investors, Utah Ventures, Wasatch Venture Funds, and other investors including Timothy Draper. theDial provides it’s partners with entertaining, web-centric spoken content created by theDial’s productions staff.
PHILADELPHIA, and CUPERTINO, Calif. — U.S. Interactive (Nasdaq:USIT), an Internet professional services company, agreed to acquire SoftPlus, a privately-held, e-solutions company based in Cupertino, CA. The consideration for the transaction is 4.8 million shares of US Interactive common stock (about $260 million), $20 million in cash, and a one year $80 million note due to the selling shareholders. SoftPlus develops comprehensive business-to-business e-solutions with technology frameworks and “integration patterns” for customer relationship management solutions.
PASADENA, Calif. — Ticketmaster Online-CitySearch (Nasdaq:TMCS) acquired 2b Technology, based in Richmond, Virginia, for approximately $23 million in Ticketmaster Online-CitySearch stock. 2b Technology is a fast growing, fully-integrated visitor management and ticketing firm targeted at venues such as higher volume museums, cultural institutions and historic sites. 2b Technology has three main business products: a Web-based ticketing product (http://www.museumtix.com), a third-party ticketing service, and a reservations, scheduling and admissions software solution. 2b currently earns revenue on over 2 million fee-generating tickets and its clients sell over 90 million tickets annually. 2b Technology was profitable in 1999.
LAS VEGAS — Flight Time Corp., a leader in air charter, will acquire Wyvern Ltd., a safety and compliance auditing firm, and MACH-1 Software Corp., a provider of aviation enterprise management software, and rename the company FlightTime.com. The new company will leverage the safety and technology components associated with Wyvern and MACH-1 with the company’s existing e-commerce site AirCharter.com to create the first, audited global aviation network. FlightTime.com has received substantial financial backing from Southeast Interactive Technology Funds and BancBoston Ventures.
SCOTTS VALLEY, Calif. — OpenAvenue acquired CodeCatalog and Cyclic.com from SourceGear Corp. OpenAvenue is a privately-held, business-to-business company specializing in Web-based hosting, management, and distribution of worldwide collaborative software development projects. SourceGear is a leader in the Linux community and a vendor of Internet products and services for software developers. Terms were not disclosed. OpenAvenue recently closed afinancing round.
SAN FRANCISCO — Macromedia (Nasdaq:MACR) acquired the assets of Time4.com, a Minneapolis-based Web application development firm. The privately-held company, which created a Web-based reservation system, was acquired for an undisclosed amount. Time4.com’s president and chief executive officer Douglas K. Olson will serve as vice president of engineering for the Macromedia eBusiness Solutions Group.
MIAMI, Feb. — perfumania.com (Amex:PF) signed a definitive agreement to acquire all the outstanding stock of Envision Development Corp. Terms of the deal were not disclosed. EDC’s customer value proposition encompasses extending marketing reach, automating sales and support functions, automating the supply chain, and enhancing overall business
SAN FRANCISCO, CA, — Net Value Holdings (OTC BB:NETVE), a virtual Internet incubator for early stage e-businesses, acquired a 25% interest in IndustrialVortex, a new business-to-business Internet portal focusing on the industrial automation industry. Terms were not disclosed.
TAMPA, Fla. — BrainBuzz.com, a virtual community and online resource for IT professionals and job seekers, acquired surfIT.com, an Atlanta-based online job site that recently completed its first round of venture capital financing. The foundation of the BrainBuzz.com site consists of more than 200 topic-specific discussion boards “hosted” by highly trained professionals and industry experts. Terms were not disclosed.
PHILADELPHIA — Keystone Venture Capital closed Keystone Venture V, a $102 million fund. Keystone V is targeting early and expansion stage companies in high-growth technology sectors, with particular emphasis on Internet-enabling applications, telecom and wireless communications, and B-to-B and B-to-C electronic commerce. Limited Partners include the Pennsylvania State Employes’ Retirement System, the State of Connecticut Retirement Plans, the City of Philadelphia Board of Pensions and Retirement, Dime Capital, Citizens Capital, Progress Bank, Silicon Valley Bank, Imperial Bank and Cambridge Holdings. Atul Madahar and Robert Pace have joined the team of investment professionals as vice presidents.
DALLAS– eVentures Group (OTCBB:EVNT) completed its investment in LaunchCenter 39, New York’s full-service incubator for Internet startups. Other investors include David Smilow, Jay Chiat, Kevin Ryan, Bill Rudin and Tracy Leeds. The company closed more than $25 million in Series A Preferred financing in January 2000.
Who’s Who & Where
LOS ANGELES– CarsDirect.com, an automotive e-tailer, appointed Kevin D. Gaskell, former managing director of BMW Great Britain Ltd., as chief executive officer, Europe. CarsDirect.com closed a $280 millionfinancing round in November 1999. The company is funded by idealab! Capital Partners, Primedia Ventures, Foundation Capital, MSD Capital, Goldman Sachs, Morgan Stanley Dean Witter, Hambrecht & Quist, E*O Investors, Oracle Corp., Liberty Digital, TMCT Ventures, East Peak Partners, Hikari Tsushin and Soros Private Equity Partners.
ALHAMBRA, Calif.–PropertyFirst.com, an online marketplace for the commercial real estate industry, announced the company has expanded its major accounts group and added Jon Torgeson as vice president of major national accounts. Torgeson has been with CB Richard Ellis since 1978, most recently as senior vice president of investment properties focusing on the sale of investment-grade office properties and corporate asset dispositions. PropertyFirst.com closed a $44.3 millionfinancing round in November 1999.
NEEDHAM, Mass.– NerveWire, a business-to-business Internet professional services firm, named Kirk Arnold chief operating officer, executive vice president, and member of the NerveWire board of directors. Before joining NerveWire, Kirk was president of the consulting group of Computer Sciences Corp. Thoma Cressey Equity Partners has committed $60 million to fund the company’s growth strategy.
SAN FRANCISCO– Geneva Venture Partners, a seed and early stage venture capital fund for new economy, web-centric startups, appointed Robert Hambrecht as a Special Advisor to Geneva Venture Partners II, a $60 million investment fund in the process of formation. Geneva Venture Partners LP was spun off from GenevaGroup International, an internet and software search firm, in 1997. Hambrecht is the managing director of equity capital markets for WR Hambrecht + Co.
Do you think YOUR cool company ought to be featured in a VC Watch column?
Then go here …
… and tell us all about yourself.
VC Buzz, that is.
The latest buzz on the daily deals coming down in the femtosecond pace of the Venture Capital world
VC Buzz brings you the latest on who’s gotten their funding and from whom, what’s happening at the VCs and who’s just swallowed whom in the maniacally fast, deadly serious Darwinian scramble for Internet success and dominance.
Don’t get trampled by the herd … stay ahead with VC Buzz, delivered every business day to your e-mail box.
Check it outonline or SIGN UP get it delivered FREE every day to your e-mail. When you sign up, scroll down to the “Internet Stocks Channel” subhead and check the VC Buzz box.