Venture Capital News
2005 VC Report: Nanotech Funding Doubled
Venture capitalists invested more than twice as much money in U.S. nanotechnology companies in 2005 than they did in 2004, according to a Small Times analysis released this week.
The investment amount reflects the maturing of the first generation of nanotech startups that were founded earlier this decade, many of which raised large later stage rounds during 2005.
Nanotech funding hit $434.3 million for 2005, up 121 percent over the previous year's $196.4 million. The year's performance set a new record for nanotech funding, according to a Small Times analysis of the MoneyTree Survey by PricewaterhouseCoopers, Thomson Venture Economics and the National Venture Capital Association.
Actual funding activity measured by the number of deals that took place during the year was up more modestly, from 45 in 2004 to 51 in 2005.
The large funding figure was fueled by large later stage funding rounds throughout 2005. The year started out strong, led by Nano-Tex, the maker of nano-enabled fabric enhancements, raising $35 million and Aspen Aerogels, which makes thermal and acoustic insulators, raising $30 million.
Investors maintained pace in the second quarter, led by Nanosolar and Neophotonics, each of which raised $20 million. Large rounds tapered off somewhat in the third quarter before picking up again in the fourth, which featured the largest nanotechnology venture deal of the year, Nanosys' $40 million round.
In the broader category of "small tech," which encompasses nanotechnology, MEMS and microsystems, 2005 was the first year since 2001 that investors deployed more than $1 billion, investing $1.06 billion in 122 rounds. In 2004, by contrast, the category attracted $865 million in 126 rounds.
[ FYI Index ]
Industry Pioneer Launches Next-Generation Venture Financial Services Company TriplePoint Capital
Representatives of TriplePoint Capital, the Sand Hill Road-based financial services company started by venture leasing and lending industry pioneer Jim Labe, formally announced and launched its business, supported by $310 Million in institutional financing.
TriplePoint Capital offers substantial flexibility and a number of unique value-added service options to entrepreneurs seeking debt financing to complement their equity dollars. The company provides innovative equipment leases and loans, growth capital loans, expansion loans, and other forms of debt to venture-backed companies throughout their lifespan, from the earliest stages through post Initial Public Offering (IPO) stages. The company also offers an innovative customer-focused model, flexible financing options, global capabilities, and a senior team with deep domain expertise.
In the early 1980s Labe was instrumental in developing the venture leasing and lending product at Equitec Leasing Company, a division of Equitec Financial Group, where he played a key role in making venture leasing and lending an essential source of capital for private companies backed by leading venture capital firms. In 1987, Labe left Equitec and founded and served as the CEO of Comdisco Ventures, which quickly became the leader of the venture leasing and lending industry. He grew Comdisco Ventures' annual revenues from scratch to more than $670 Million, building a portfolio of more than $3.5 Billion in venture leases and loans to more than 1,000 customers.
Labe has assembled a broad senior team and advisory board of more than 20 professionals including an impressive number of industry veterans with expertise in venture leasing and lending, venture capital, private equity, commercial finance, commercial banking, investment banking, technology development, and entrepreneurship.
TriplePoint Capital is actively transacting business with leading venture-backed companies in the information technology, life sciences, and other high-growth industries. TriplePoint Capital operated in stealth mode in 2005 and has already amassed an impressive list of customers backed by such leading venture capital funds as Greylock Partners, InterWest Partners, Kleiner Perkins Caufield & Byers, Mayfield Fund, Sequoia Capital, Sierra Ventures, Sutter Hill Ventures, and Venrock Associates, among others. The company's capitalization includes participation by top-tier institutional investors and investment banks.
[ FYI Index ]
Hammerhead Systems Secures $30 Million in Series C to Fund Ramp in Sales, Customer Support, and Operations
Representatives of Hammerhead Systems, Inc., the market leader in Layer 2.5 Aggregation solutions, announced Wednesday the closing of a $30 million Series C round of funding, led by new investor Silver Creek Ventures and joined by new investor Apex Venture Partners. All existing investors participated in the round which now brings the total equity raised by Hammerhead Systems to $80 million. The funds will be used for working capital including expanding sales, marketing and customer support in North America and internationally, as well as the acceleration of product development in response to customer demand and establishing volume manufacturing.
[ FYI Index ]
Incipient Secures $24 Million in Series D
Representatives of Incipient, Inc, a leading provider of intelligent switch storage software, announced Tuesday that it has raised $24 million in Series D financing bringing the total equity capital raised to $79 million. Leading this round is new investor QuestMark Partners, along with participation from Wasatch Advisors. Incipient’s major existing investors Globespan Capital Partners, GrandBanks Capital, Greylock, HLM Venture Partners, and Sigma Partners also participated in this round of financing. The Series D capital is earmarked for expansion of marketing and sales efforts in support of the Incipient Network Storage Platform (NSP) software suite.
Incipient NSP is embedded in intelligent Fibre Channel (FC) switches and serves as a common software platform that delivers Incipient-developed, network-based storage applications throughout a SAN environment. This set of highly scalable integrated storage applications provide storage services such as volume management, data protection, copy services, automated provisioning and data mobility. Incipient NSP inserts an abstraction layer between storage and hosts, creating a storage virtualization layer where Incipient NSP-based storage services are implemented. Incipient NSP currently supports or will support intelligent FC switches manufactured by industry leading companies such as Cisco, Brocade, McDATA, QLogic and others.
[ FYI Index ]
Tararo Accelerates Growth with $14 Million in Series C
Representatives of Tarari Inc. announced Wednesday that it has successfully completed a Series C round of private equity financing for $14 million. The lead third-round investor, Enterprise Partners Venture Capital (EPVC), was joined by existing investors, including Crosspoint Venture Partners, Morgan Stanley Venture Partners, Miramar Venture Partners, and XMLFund. Bob Conn, managing director at EPVC, has also joined the Tarari board of directors.
A number of analysts including IDC who track the market for XML and Network Security products predict that sales will exceed 2 million units with revenues of more than $21 billion by 2008. The XML & Network Security market includes the following sub-markets: Intrusion Detection/Prevention (IDS/IPS), Antivirus, Antispam, Compliance, XML Gateway, XML Server, Content Networking, Firewall, and Unified Threat Management (UTM). Showing particularly strong growth is the Threat Management security appliance market which alone will exceed $5 billion by 2009.
These markets are ideal for Tarari, and the company has solid design wins with market-leading OEMs and ISVs. Tarari has repeatedly demonstrated its ability to execute on its silicon road map to bring innovative technologies to market. Tarari's "Content Processor" products are ASICs, production boards, and embedded software components that are designed to snap in to networking, appliance, and server systems. The company has a growing number of Tier 1 original equipment manufacturer (OEM), original design manufacturer (ODM), and independent software vendor (ISV) customers for its Network Security, XML and Digital Media products.
The company's technologies have won numerous awards, including the 2005 ComputerWorld Honors Program Medal of Achievement, Grand Best of Show Award at the 2005 Network Systems Design Conference, finalist for Red Herring 100 Private Companies Award, and Most Innovative Product award from UCSD Connect.
