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Random Ramblings The self-obsessed blogosphere is sure to be buzzing today with news that Technorati has scored $7.6 million in Series C funding, from return backers like DFJ and Mobius Venture Capital (according to a regulatory filing). But Technorati is basically just a search engine, rather than an original content provider. So imagine the hubbub when HuffingtonPost.com finishes up its first institutional round of VC funding later this summer. “Validation, oh sweet validation!” the bloggers will shout from their basements, while most VCs try to understand how HuffPo’s non-contextual button ad-revenue model will ever produce venture-type returns. I would have asked HuffPo co-founder Ken Lerer that very question, but he gave me a reflexive “No comment,” before I could finish uttering “I’m calling about the venture capital round...” Expect the initial raise to be $5 million, with more to come. *** Steve Syre has a good Boston Globe column today on Thomas H. Lee Partners’ $6.1 billion fifth fund, which closed in 2000. Specifically, he details how the fund is producing decent returns for limited partners, despite the Refco disaster and middling performing of American Media (you know, the deal that resulted in Harvard owning a piece of The National Enquirer). While THLP continues to put the finishing touches on a new $9 billion fund, estranged namesake Tom Lee continues to build out his new shop down in *** The latest issue of Buyouts Magazine reports that U.S.-based buyout firms disbursed around 39% more during the first half of 2006 (approx. $110 billion in disclosed value) than over the first half of 2005. And this doesn’t even count pending mega-deals like Kinder Morgan. As for fund-raising, the data shows around $93 billion raised for LBO funds, mezzanine funds and related funds-of-funds during the first half of 2006. This is compared to just $79 billion over first-half 2005 totals (which itself was a record). *** Finally, a quick quiz. Can you name the Silicon Valley-based GP of a bi-coastal venture firm who recently -- and quietly -- resigned/retired? Hint: The firm's original healthcare partner has transitioned into an emeritus role.
CinemaNow Inc., a Marina Del Rey, Calif.-based online provider of on-demand movies, has raised $20.3 million in Series E funding. EchoStar Communications Corp. and Index Holdings co-led the deal, and were joined by return backers Transcosmos, Cisco Systems, Lionsgate and Menlo Ventures. www.cinemanow.com JER Partners and Formation Capital have bought Tandem Health Care Inc. from Behrman Capital for $620 million. Tandem is a Maitland, Fla.-based provider of long-term healthcare services. It received an initial $30 million investment from Behrman Capital in 1998, and since has received around $37 million in additional funding to facilitate acquisitions and growth. Citigroup and Merrill Lynch acted as financial advisors to Tandem on the sale. Chequers Capital, a Paris-based buyout firm focused on unlisted French middle-market companies, has closed its latest fund with €600 million in capital commitments. New limited partners include Citigroup, MassPRIM, PSERS, Queensland Investment Corp., while returning LPs included HarbourVest Partners, HSBC-Nobel, JP Morgan, LGT Capital Partners, Lombard Odier Darier Hentsch and Pantheon Ventures. MVision Private Equity Advisors served as global placement agent. www.chequerscapital.com
Metavize Inc., a San Mateo, Calif.-based provider of network security and monitoring for small businesses, has raised $10.4 million in Series A funding, according to a regulatory filing. Backers include CMEA Ventures and Rustic Canyon Ventures. www.metavize.com Pentaho Corp., an Orlando, Fla.-based provider of an open-source business intelligence suite, has raised $8 million in Series B funding from return backers Index Ventures and New Enterprise Associates. www.pentaho.com
Radiasense Inc., a Lawrence, Mass.-based provider of real-time indoor positioning solutions, has raised $6 million in Series B funding. National Healthcare Services led the deal, and was joined by return backers HLM Venture Partners, Partech International, Ascension Health Ventures, Kaiser Permanente National Venture Development and Partners Healthcare. www.radiasense.com ScanScout Inc., a Smyrna, Ga.-based medical device startup, has secured $1.03 million of a $1.3 million Series A round, according to a regulatory filing. Backers include First Round Capita,, Permalon Ltd., Claudio Chiuchiarelli and Ron Conway. www.scanscout.com Crossroads Media Holdings LLC, an East Lansing, Mich.-based provider of outdoor advertising services, has formed with the help of an undisclosed amount of private equity funding from Peppertree Capital. Mirics Semicondcutor, a UK–based RF and mixed signal fabless semiconductor company for the mobile broadcast receiver market, has raised an undisclosed amount of VC funding from Pond Venture Partners. www.mirics.com
Century Park Capital Partners is sponsoring a spinout of the Specialty Manufacturing Co. division of The Ellison Company Inc. No financial terms were disclosed, except that senior note financing was provided by Merrill Lynch Capital, GE Antares Capital and Madison Capital Funding. Carlyle Mezzanine Partners provided mezzanine financing. Specialty Manufacturing Co. is a Pineville, N.C.-based supplier of safety components, lighting systems and accessories to the school and transit bus markets.www.specmfg.com KKR and AXA Private Equity have teamed up with Eurazeo and Goldman Sachs, in an effort to acquire a 52% stake in France Telecom directories subsidiary PagesJaunes, according to Les Echos. Other bidders include Vivendi, Texas Pacific Group and the pairing of PAI Partners with BAC Partners. Apax Partners would consider a merger of do-it-yourself retailer Focus (in which it holds 30%) with MFI Retail, if it wins an auction for the latter, according to The Telegraph of Freestone Partners has acquired an undisclosed stake in Sweet Leaf Tea Co., an Austin, Texas-based maker of ready-to-drink iced teas, from Milestone Venture Group. Freestone also has committed to make an additional equity infusion. www.freestonepartners.com
Berkline/BenchCraft Holdings Inc., a Morristown, Tenn.-based, has withdrawn registration for a proposed $138 million IPO. It had planned to trade on the Nasdaq, with BB&T Capital Markets and Morgan Keegan & Co. serving as co-lead underwriters. Berkline/BenchCraft was formed in 2002 by private equity firm Code Hennessy & Simmons, for the purpose of acquiring both The Berkline Corp. and the Benchcraft operating division of Universal Furniture. In additional to Code Hennessy, company shareholders include Ares Capital, BB&T Capital Partners and Randolph Street Partners. www.berkline.com
Pfingsten Partners and Hilco Equity Partners have sold Rx Label Technology Corp. to Cenveo Inc. (NYSE: CVO). No pricing terms of the all-cash transaction were disclosed. Rx Label is a Joplin, Miss.–based producer of pressure-sensitive prescription labels for the ChoicePoint (NYSE: CPS) has acquired most of the assets of ePolicy Inc., a Torrance, Calif.-based provider of administration solutions for commercial insurance carriers. No financial terms were disclosed. EPolicy raised around $65 million over a pair of VC round in 1999 and 2000, including a $52 million infusion at a post-money valuation of approximately $203 million. Participants included Arch Venture Partners, Allen & Co., Banc of America Securities, J&W Seligman & Co., Nautic Partners, Madrona Venture Group, Riverside Management Group, TD Capital and Shawmut Capital Partners. www.choicepoint.com www.epolicy.com Cisco Systems Inc. (Nasdaq: CSCO) has completed its $28 million cash acquisition of Metreos Corp., an Austin, Texas-based provider of IP communication application development and management environments. Metreos had raised over $4 million in VC funding since its 2001 inception, from firms like StarTech Early Ventures, Gefinor Ventures and Hunt Ventures. www.cisco.com www.metreos.com First Data Corp. (NYSE: FDC) has agreed to acquire Peace Software Inc., a Miami, Fla.–based provider software for managing utility billing and customer care. No financial terms were disclosed for the deal, which is expected to close later this quarter. Peace Software raised a $20 million VC round in 1999 from Insight Venture Partners and Kinetic Ventures. www.firstdata.com www.peace.com Cardinal Health Inc. (NYSE: CAH) has acquired MedMined Inc., a Vestavia Hills, Ala.–based provider of technology and services that identify and prevent hospital-acquired infections. No specific financial terms were disclosed, except that the deal was valued at between $50 million and $100 million. MedMined had raised around $10.25 million in VC funding from firms like Child Health Investment Co. and Southeastern Technology Fund. www.cardinal.com www.medmined.com
Giuliani Capital Advisors (US), Aforge Finance SA (France) and Sal. Oppenheim jr. & Cie (
John Manzetti has joined the Pittsburgh Life Sciences Greenhouse as an executive-in-residence. He previously served as president and CEO of management services firm M2 Partners. www.plsg.com Robert Swannell, vice chairman of Citigroup Europe, will join the board of 3i Group as a non-executive director, effective September 1. www.3i.com Stephan Garden has joined Celeplast Inc. (OTC BB: CERP), a maker of resins from renewable and biodegradable source, as vice president of finance. He previously was with Allied Capital. www.cereplast.com Eric Wilkins has agreed to join Wachovia Capital Partners in Summit Partners has promoted Christopher Dean to general partner. He joined the firm in 2001 as a vice president. www.summitpartners.com Uwe Steininger has joined Hogan & Hartson LLP as a Germany-based partner focused on private equity and venture capital. He previously was with SJ Berwin. www.hhlaw.com Jamie Welsh has joined Kaulkin Ginsberg Co. as a director. He previously was with Garnet Capital Advisors, where he advised banks and other financial institutions on sales of non-performing assets. www.kaulkin.com
Jeff Shippy has agreed to join Houlihan Lokey Howard & Zukin later this month, as a member of the firm’s consumer, food and retail I-banking practice. He previously was a vice president with Mosaic Capital. www.hlhz.com
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