Prepared by Capital Hunter analysts
This period was the strongest week for venture capital investment in years, as a whopping $714 million was placed across 55 separate companies, both totals setting new records for funding starting from the inception of our newsletter service in 2003. This is even more incredible considering the fact that venture funding tends to follow the NASDAQ, which is down approximately 6% for the year. Funding this period was led by software investment but significant amounts of money found its way into the industrial sector, with Nanosolar, a developer of thin-film solar panels, raising $75 million in third round financing from a bevy of venture firms and institutional investors including Benchmark Capital, Mohr Davidow Ventures, SAC Capital, and others. The networking sector also raised a healthy amount of cash, with over $100 million going to companies such as OpVista, which provides optical transport systems for the cable industry, and Acopia Networks, a provider of networking platforms for the management of global data distribution. Unlike past weeks where companies raising their early rounds of financing won out over their more mature counterparts, venture capitalists placed more money with middle and later stage companies this time around, as the aforementioned Nanosolar, OpVista, Acopia, biotech firms Transave and Rib-X Pharmaceuticals, and medical device company GI Dynamics all raised significant sums (>$25 million) of money. This week is almost certainly an anomaly, as we expect venture funding to remain robust throughout the year (though if any headway is made in mitigating the deleterious effects of Sarbanes-Oxley on the ability of companies to go public VC funding rates may increase substantially) but not in the vicinity of the levels seen this week. Stay tuned.
There were just four initial public offerings this week, down from six two weeks ago, with only a single VC backed firm, TechWell, among the four. The other three companies, as you can see below, are financial companies, including two small banks and a life insurance company. TechWell most recently in October of 2003 received $20 million in Series E funding from Technology Crossover Ventures and provides semiconductors for the consumer and security markets. Here is a description of the four firms that listed this period:
Eastern Insurance Holdings
NASDAQ:EIHI priced at $83.1 million and is the holding company of Educator’s Mutual Life Insurance Company, a provider of mutual life and health insurance group benefits products.
Beverly National
AMEX:BNV priced at $15.2 million and is a provider of banking services in Massachusetts.
TechWell
NASDAQ:TWLL priced at $49.5 million and is a designer of mixed signal integrated circuits for video applications in the consumer, video surveillance and automotive markets.
Home Bancshares
NASDAQ:HOMB priced at $45 million and is a financial holding company with five community bank subsidiaries that provide retail banking services to businesses and consumers.
Please come visit our web site at
CapitalHunter.com. We have made improvements to both the look and functionality of our web site, including business resources, glossary terms, and other helpful information provided free of charge for the budding entrepreneur. For private equity firms, consulting firms, business journals, and individuals looking to do research on venture backed companies, you can still gain complete access to our entire database for $59 a quarter and $199 a year.
