Venture Update Vol III, #7, July, 1999
Durham-ClinEffect Systems Inc. (www.clineffect.com), a developer and licensor of software that collects accurate and complete data for outcomes research and provides process control for physician-driven charge capture and documentation at the point of care (CEDs), received $2 million in second round venture financing from Monarch Capital Partners in June 1999. Contact: Ben Feldman (919.383.9883).
Durham-Protein Delivery (www.proteindelivery.com), a drug delivery company specializing in the oral delivery of proteins and peptides including an oral insulin and oral calcitonin, raised $22.9 million in venture funding in June 1999. Investors included a large institutional investor and the Aurora Funds. Contact: Christopher Price (919.474.0507).
Research Triangle Park-KOZ.com (www.koz.com), a developer of software for Internet communities, closed on $15 million in fifth round venture financing in June 1999. Investors included Southeast Interactive Technology Funds. Contact: Wendy Robinson (919.767.2131).
Research Triangle Park-Industrial Microwave Systems, Inc., a developer of patented microwave technology for continuous flow industrial heating and drying applications, closed on $2.2 million of Series B financing in June 1999. Martin Marietta Materials, Inc. led the round. Other investors included TriState Investment Group III, the North Carolina Technological Development Authority and private individuals. Contact: Michael Drozd (919.990.9900).
Cary-Access Point (www.apitelecom.com), a local and long distance telecommunications service provider, received $ 3 million in expansion round venture financing from Blue Water Venture Fund II. Contact: Robin Byers (919.851.4838).
Raleigh-StreamServe (www.streamserve.com), a developer of software for personalized output management of documents created in various software, closed on $8 million in venture financing from Apax Partners. CEO and co-founder Hans Otterling has relocated to the company's North American headquarters in Raleigh. Contact: Jennifer Chase (919.786.7311).
Chapel Hill-Catalogue.com (www.catalogue.com), an Internet database developer and e-commerce service provider, merged with DVD Holding Corp. of New York, the parent company of DVDFLIX.COM and MusicHQ.COM. The new company will be known as Catalogue.com and will be based in Chapel Hill. Contact: Eric Garrison (800-419-1821).
New Developments
Durham-Red Hat Software, Inc. (www.redhat.com), a
developer and distributor of Linux computer operating
systems, has filed with the U.S. Securities and
Exchange Commission to make a public offering. The
company plans to raise $96.6 million stock offering.
The company has changed its name from Red Hat
Software to Red Hat Inc. Contact: Lisa Sullivan
(919.547.0012).
Durham-OpenSite Technologies , Inc. (www.opensite.com), a developer of software for internet-based auctions, filed with the U.S. Securities and Exchange Commission in May 1999 to make a public offering. The company plans to raise $40 to $45 million in the initial offering. Contact: Shawn Ramsey-Kroboth (919.544.1993).
Durham-Eno River Capital, LLC, manager of the North Carolina Bioscience Investment Fund, has formed an agreement with two Taiwanese venture capital groups to invest $2.5 million in the Fund. Contact: Paul Jones (919.680.4511).
Durham-Inspire Pharmaceuticals, (www.inspirepharm.com) a pharmaceutical company focused on the discovery and development of novel therapeutics based on mucosal hydration and epithelial cell biology, was awarded a patent by the U.S. Patent and Trademark Office for new chemical entities (NCEs) that may be used for the treatment of respiratory diseases and other mucosal hydration targets. Contact: Janet Rideout (919.941.9777).
Research Triangle Park-The Council for
Entrepreneurial Development (www.cednc.org)
recognized 11 Triangle entrepreneurial companies and
members of the entrepreneurial community with its
Entrepreneurial Excellence Awards on June 10,
1999.
Winners of this year's awards were:
Entrepreneurial Excellence Award
Red Hat, Inc.
Outstanding Service to Entrepreneurs
Tim Gupton, Hughes Pittman & Gupton, LLP
Deal of the Year
OpenSite Technologies, Inc.
Deal of the Year
SciQuest.com, Inc.
IT Product of the Year
Electrifier Pro, Electrifier, Inc.
Life Science Technology of the Year
Cogent Neuroscience, Inc.
Spin-Off of the Year
Unitive Electronics, Inc.
Start-Up of the Year
Foveon Corporation
Community Impact Award
Midway Airlines
President's Service Award
Jim Talton, KPMG
FastTracker of the Year
Donovan Moxey, LIPSinc.
On The
Up
NETGIFT REGISTRY NETWORK
Durham, North Carolina-based NetGift Registry
Network is changing the way people give presents by
creating the first online all-occasion gift registry
network. The registry allows consumers to select
gifts they'd like to receive and enables their
friends and family to choose the perfect present. And
it even reminds you to place the order.
NetGift currently has 400 retailers offering more than 2 million products. Retailers include E-Toys, FAO Schwartz, Ross Simon and EggHead Software. "If you don't find what you want, there's a text box to type in your Jaguar, for example," notes Steve Furst, the company's CEO.
Founded in 1998, the concept was conceived of and started by Fusion Ventures LLC, a North Carolina-based seed stage business development fund and incubator. In March, Jupiter Communications issued a report noting that "gift registries are the next killer application on the Internet. Clearly NetGift is that killer application because of our networking technology," Furst says. "Everyone will expect to boot up in the morning and be reminded of a gift they need to buy for one of the 25 holidays or gift giving occasions we face each year."
Furst, former president of specialty retail chains Gottschalks and Hess, joined the company in February. He developed one of the first WAN system touch screen registries and did a startup of one of the first e-commerce web sites for department stores in the nation.
NetGift Registry recently secured $1.5 million in a second round of venture capital funding from individual investors. The company plans to raise another $10 million before the end of the year.
Featured Fund
BLUE WATER CAPITAL
Blue Water Capital, based in McLean, Va., invests in
information technology and services companies
operating the mid-Atlantic region and seeking
expansion-stage funding. The firm chose that segment
for several reasons, according to Reid Miles,
managing director and founder. "We have relevant
experience in the IT industry and are active
investors -- we want to be close to our investments.
We also see a very strong and quality deal flow in
the region."
The firm was founded in January 1996 when it launched its first fund, Blue Water Strategic Fund I, L.L.C. In two years it raised $25 million and made eight investments. Now on its second fund, Blue Water Venture Fund II, L.L.C., the firm is shooting for $100 million. Fund II, which made its first investment in January, invests in expansion-stage information technology and services companies with revenues in the $2 million to $50 million range.
Its first investments in Research Triangle companies included $3 million to Research Triangle Consultants (RTC) and $3 million to Access Point, Inc.
"We are very pleased to have found two exceptional opportunities in the Triangle," Miles notes. The fundings were expansion rounds for both companies and the proceeds will be used for business development purposes.
"We look for the best deals in our space," Miles continues. "These deals will likely lead to other investments for us in the area. There's a lot of potential there."
Blue Water Capital can be reached at www.bluewatercapital.com.
Mark Your
Calendar!
North Carolina Tech 50 Awards
August 19, 1999
5:30 p.m.
North Raleigh Hilton
STREAK
Luncheon
September 2, 1999
Noon-1:30 p.m.
Sheraton Imperial, RTP
Corporate Partnering Seminar
September 9, 1999
1:30-5:00 p.m.
Venture
Capital for Entrepreneurs
September 28, 1999
1:00-5:00 p.m.
NCBC
For more information about these events or to register, visit the CED Web site at www.cednc.org or call 919.549.7500.
CED is a private non-profit supported, in part, by corporate contributions, including funding from Intersouth Partners, KPMG Peat Marwick and Manpower.
Research Triangle Venture Update is published by
the Council for Entrepreneurial Development (CED), a
non- profit organization located in Research Triangle
Park, N.C.
Editor Carolyn Foy, CED
P.O. Box 13353
RTP, NC 27709
Phone: 919.549.7500
Fax: 919.549.7405
Email: mcfoy@cednc.org