VC Buzz – $457.9+ Million in Today’s Deals

LOS ANGELES– Less than six months after public launch, CarsDirect.com, the automotive e-tailer, has received commitments to fund $280 million in its latest round of financing. At the same time, the company announced that it has named Robert N. Brisco, formerly president, Universal Studios Hollywood, as its new chief executive officer, effective immediately. Scott Painter, founder and CEO, will become vice-chairman.

All of the company’s original corporate and institutional investors — which include idealab!, idealab! Capital Partners, Primedia Ventures, Foundation Capital, Michael Dell’s MSD Capital LP, and Goldman Sachs — participated in this latest investment round. New participants in the round include investment banking firms Morgan Stanley Dean Witter, Hambrecht & Quist, and E*O Investors LLC; strategic investments that include Oracle Corp., Liberty Digital, TMCT Ventures and East Peak Partners L.P; and investments from international partners Hikari Tsushin, and Soros Private Equity Partners LLC.

RALEIGH, N.C. — Total Sports Inc. completed an offering of approximately 2,100,000 shares of Series D Preferred Stock to certain institutional investors. The shares were priced at $16.59 per share, resulting in gross proceeds of approximately $35.5 million. Principal buyers of the Series D Preferred Stock include Technology Crossover Ventures, Zilkha Capital Partners, EGL Holdings, Sycamore Venture, Access Technology, Trans Cosmos USA Inc., WinStar New Media, InterBrew/Labatt and Asdale Limited, among others. The company also announced it filed a registration statement with the SEC for a $50 million IPO.

NEW YORK — “kpe” raised $21.5 million in cash from a group of investors including Wasserstein Adelson Ventures, Clarion Capital Partners, Grey Advertising, “kpe” management and several private investors. “kpe” is a digital studio that creates interactive media and entertainment businesses through its venture incubation and client service units. “kpe”‘s venture arm invests the resources of “kpe” in return for equity stakes in early-stage interactive businesses conceived by individual entrepreneurs, stand-alone ventures developed in conjunction with leading media and entertainment corporations and in-house ventures originated and developed by “kpe”. The company plans to use the funds to increase its portfolio of investments in early-stage Internet ventures, to make strategic acquisitions, and to expand its core operations in New York, Los Angeles and London.

NEW YORK, N.Y.– Quidnunc, an e-business consultancy for forward-thinking organizations, completed a $15 million first round of financing with Goldman Sachs Private Equity Partners and Weston Presidio Capital. As a result of the funding, the two firms will hold a 13.6% share in the company. Quidnunc meet’s a company’s short-term business objectives and creates a solid foundation for all future strategic developments, using its delivery framework and techniques, such as Scenario Modelling and Risk Mapping.

PALO ALTO, Calif. — Octopus.com, a pre-launch Internet company, closed its first round of funding in the amount of $11.4 million. Redpoint Ventures, a new venture capital firm focused on broadband infrastructure, services and media opportunities for the next generation Internet and television, committed $10.5 million. Octopus.com also received funding from Angel Investors LP, Amicus LLC, and individual investors. This is the second announced investment by Redpoint.

AUSTIN, Texas– ibooks.com, a source for digital online reference books, completed a $4 million first round funding. TL Ventures lead the round with a $3 million investment. ibooks.com’s investment also includes seed funding from Arkoma Venture Partners, Gene Lowenthall, Greenfield Capital Partners, Microsoft Ambassador Mike Maples Sr., Murphree Venture Partners, and Peter Zandan, the founder of Intelliquest. In related news, ibooks.com appointed Jerry Weissberg, a former executive VP and general manager for Ziff Davis Inc., to CEO of ibooks.com.

SAN DIEGO– Stellcom Inc., a provider of total Internet business solutions for clients including Microsoft Corp., Hewlett-Packard and Qualcomm, raised $3 million in venture capital. The financing was provided by Mission Ventures, an information technology-based venture capital firm, located in San Diego. Stellcom offers services ranging from Internet device development to enterprise system integration to e-commerce development and Web site design.

The funding will be in the form of private equity placements of restricted common and preferred shares, the majority of which will be issued at prices ranging between $3 – $5 a share in three separate tranches. The first tranche for $100,000 closed last week; the second tranche for $200,000 is expected in three weeks; and the final tranche for $1.2 million is projected to close when the company is ready to execute its new nationwide marketing program right after the first of the new year.

ARROYO GRANDE, Calif.– AmeriComUSA Inc., a provider of browser driven technology for e-commerce systems, announced an agreement between the company and Synapse Capital LLC, for a significant equity investment. Synapse Capital will purchase a portion of the company’s equity for $1 million. Synapse and AmeriComUSA alsoentered negotiations for Synapse to advance an additional $1 million to AmeriComUSA in the form of a convertible loan before the end of this year. In addition, AmeriComUSA will issue a warrant for the future purchase of 500,000 company shares by Synapse. All arrangements will be conducted through a Synapse managed fund.

PALO ALTO, CA– Spin Media Network Inc., a free Internet access partner and advertising technology company, announced a round of investments from Al Shugart International, Mentor Venture Partners and SOFTBANK Venture Capital. Spinway.com is a marketing solution that provides businesses with co-branded or private label, free dial-up Internet access for use in driving traffic and broadening brand identity. Spinway.com also delivers an Internet advertising format featuring full-motion video at dial-up.

SANTA MONICA, Calif.– eCompanies Venture Group announced its investment in Craftopia.com, an arts and crafts e-commerce Web site to be launched during the first quarter of 2000. Craftopia.com is eCompanies’ third venture fund investment.

PITTSBURGH– GE Information Services, part of the General Electric Co., and ENTIGO, a provider of e-Commerce software applications, announced a new alliance, involving a major investment by GE Information Services in ENTIGO. As part of the agreement, GE Information Services joins current ENTIGO investors: Advent International, Boston Millenia Partners and Four Seasons. Financial terms are not being disclosed.

GE Information Services and ENTIGO also entered into a strategic marketing agreement, forming a joint sales team consisting of sales and technical professionals from GE Information Services and ENTIGO. The team will work together on marketing ENTIGO’s line of e-Commerce software applications to GE Information Services’ international customer base.

WALTHAM, Mass. and PALO ALTO, Calif.– Advanced Technology Ventures, a bi-coastal venture capital firm, made initial investments in four emerging Internet companies and provided additional funding to select portfolio companies. ATV is a lead investor in Decide.com, an independent consumer resource for wireless and telecommunications services and products. The firm also made significant investments in NewMediary.com, an interactive business-to-business directory matching buyers and sellers of Internet-related products and services; DirectAG.com, a business-to-business site serving the $260 billion U.S. agricultural industry; and UBUBU, which delivers an advanced personalization and community experience for Web users.

The new firm, which is yet to be named, will be based in Silicon Valley and is expected to be operational in early 2000. It will concentrate on underwriting, managing and distributing equity offerings for information technology and Internet companies. Additional plans call for providing research to individual and institutional investors and, eventually, private placement and strategic advisory services to issuers. The firm also plans to invest in later stage private companies. Scott Ryles, formerly a managing director and head of Technology Investment Banking at Merrill Lynch, will serve as CEO.

NEWPORT BEACH, Calif.– DocNet.Com has terminated its offer to sell 49% of Physiciansite.com to HealthStar Corp in a cash and stock transaction. The deal, which originally valued Physiciansite.com at over $87 million, was rescinded by DocNet.Com due to HealthStar’s current stock price and possible tax implications from the transaction. DocNet.Com and Physiciansite.com are initiating pre-IPO discussions with investment bankers.

JERUSALEM — The Jerusalem Global Group announced the establishment of three high technology incubators, Innovation Centers, focused on seed stage companies in Israel. Each Innovation Center will focus on a core area of high technology: Internet infrastructure software technologies (NetLaunch), Internet infrastructure communication technologies (CommLaunch), and medical devices (InnoMed). Each Innovation Center will have its own management company as well as an associated fund of between $20 to $40 million to finance investments in portfolio companies.

SupplierOne.com launched its e-marketplace for custom parts, a new way for original equipment manufacturers to procure custom parts online from metal and plastic fabricators worldwide. SupplierOne.com currently focuses exclusively on matching OEMs and suppliers of cast parts, sheet metal parts, machined parts, and plastic parts. Buyers fill out a simple RFQ describing their part manufacturing process and upload their drawings on the SupplierOne.comweb site. SupplierOne.com then forwards the RFQ to suppliers with matching capabilities. Suppliers respond on SupplierOne.com with quotes and recommendations on how to best make the part. The service is completely free to buyers, and suppliers pay a nominal fee to respond to a RFQ. The company is funded by angel investors from manufacturing and e-commerce backgrounds.

VANCOUVER, Wash.– New Edge Networks announced the appointment of John W. Hesse to the newly created position of chief financial officer of the data communications and high speed Internet access company planning to become the first provider of DSL service nationally in small and medium size cities. Before joining New Edge Networks, Hesse, 49, was executive vice president and chief financial officer of Protection One Inc., a company he co-founded and helped grow to the nation’s second largest security firm. Prior to that, he was president, chief operating officer and chief financial officer of Network Security Corp. in Texas. Last July, New Edge Networks completed its first round of equity funding for $15.3 million from Accel Partners, Greylock and Crosspoint Venture Partners.

PASADENA, Calif.– iExchange.com, a marketplace for investment ideas and insights, announced the appointment of technology veteran, Erik Reinholm, as vice president of technology. Most recently, Reinholm was principal and regional technology manager for Computer Sciences Corp. where he lead the technology teams focused on developing Internet-based enterprise architectures for major computer manufacturing and aerospace and defense companies. IExchange.com investors include Kleiner Perkins Caufield & Byers, idealab!, David Eisner, A. Michael Lipper, and Frank Baxter, chairman and CEO of Jefferies Group.

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