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This article was prepared for the January 15, 2003 edition of U.S. 1 Newspaper. All rights reserved.
Venture Funds
Cardinal Partners, 221 Nassau Street, Third Floor,Princeton 08542. John K. Clarke, managing general partner. 609-924-6452;fax, 609-683-0174. Home page: www.cardinalpartners.comCardinal Partners is an early-stage venture capital firm with $185million under management. It invests between $6 and $8 million percompany, and focuses on high growth companies in the information technology,life sciences, healthcare services, and medical devices sectors.In the healthcare information technology sector, Cardinal seeks investmentsthat streamline communication between providers, payers, and patients,further the R&D goals of the pharmaceutical industry, or automatethe workflow and productivity of healthcare providers. Active in thelife sciences sectors since the 1980s, the firm pursues companiesthat can offer alliances with large pharma, the potential for broadclinical application, and command of multiple technologies bearingon a specific large-market opportunity. It is particularly interestedin innovations being made in the area of drug delivery.In healthcare services Cardinal supports businesses that optimizeservice in traditional settings or empower physicians to make informedcost/benefit evaluations.Care Capital LLC, 47 Hulfish Street, Suite 310,Princeton 08540. Jan Leschly, chairman/CEO. 609-683-8300; fax, 609-683-5787.Www.carecapital.comCare Capital makes investments of between $5 million and $10 millionin later state private and public companies. It invests in life sciencecompanies with a particular focus on pharmaceuticals, biotechnology,and information technology and service companies serving the lifescience industry.In addition to providing growth capital, the fund seeks to work alongsidemanagement to acquire businesses that are for sale by private or publicowners. It also assists corporate partners who may wish to acquireor divest businesses to accomplish financial reporting, capital allocation,or other objectives.Epigenesis Pharmaceuticals, at Cedar Brook Corporate Center, is theonly Central Jersey firm in the portfolio. Other portfolio companiesinclude Anadys Pharmaceuticals, Archemix Corp., D-Pharm Ltd., DynavaxTechnologies, Medical Present Value, Microchips, Nitromed, PHT Corp.,and Renovo Limited.Domain Associates LLC, 1 Palmer Square East, Suite515, Princeton 08542. James C. Blair, general partner. 609-683-5656;fax, 609-683-9789. E-mail: domain@domainvc.comHome page: www.domainvc.comDomain Associates, with approximately $492 million under management,concentrates its investments in biopharmaceuticals, drug discoveryservices, medical devices, instrumentation, diagnostics, advancedmaterials, healthcare information systems, and healthcare services.In biopharmaceuticals it looks for a large, poorly met clinical need,a proprietary technology platform, and early evidence of efficacy.In healthcare services, it looks for a proven management team thatis first to enter a given market and a robust strategy and businessmodel.Domain has two business approaches, accelerated commercializationstrategy and defined liquidity ventures. The first involves addinghighly relevant products and/or commercial capabilities to a high-techR&D-stage enterprise, thereby mitigating risk while simultaneouslyproviding infrastructure that the company will require in the future.The second involves structuring new companies from the outset in waysthat would make them attractive acquisition candidates and, when possible,to identify the purchases and even negotiate specific acquisitionssimultaneous with (or soon following) initial investment.Early Stage Enterprises LP, 995 Route 518, Skillman08558. Ron Hahn/Jim Millar, general managers. 609-921-8896; fax, 609-921-8703.E-mail: ron@esevc.com, jim@esevc.com Home page: www.esevc.comEarly Stage Enterprises is a private venture capital fund organizedto provide capital and guidance to early stage companies in the Mid-Atlanticregion. ESE has $44 million to invest, and is licenses by the U.S.Small Business Administration as a Small Business Investment Company.It would founded in 1996 to address what its founders, Ron Hahn andJames Millar, saw as an under-served segment of the private equitymarket. In recent years, companies requiring less than $2 millionof capital have encountered increasing difficulty in securing financingas trends in the venture capital industry have shifted towards anemphasis on larger and later stage developments. ESE welcomes proposalsfrom these companies, and will consider investing as little as $250,000in companies that have exceptional growth potential. ESE works closelywith the management of the companies in which it invests.The fund specializes in providing the first institutional money investedin an early stage company. In most cases, prospective companies haveless than $3 million in annual revenue at the time of ESE’s firstinvestment. All capital invested by ESE is in the form of equity,but the investment is not intended to create a controlling interest.ESE focuses on early stage businesses in the information technology,computer software, Internet software and services, medical devicesand diagnostics, life sciences, and healthcare services sectors. Itprefers to work with companies in the Mid-Atlantic region, from Connecticutto Virginia. Its preferred first round investment ranges from $500,000to $1 million. Additional funding, up to $2.5 million total, is usuallykeyed to clearly defined milestones in a company’s progress, suchas a product test or a target level of sales.Edison Venture Fund, 1009 Lenox Drive, Building4, Suite 200, Lawrenceville 08648. John H. Martinson, Ross Martinson,and Joe Allegra, general partners. 609-896-1900; fax, 609-896-0066.E-mail: info@edisonventure.comHome page: www.edisonventure.comEdison invests in expansion stage ($5 to $20 million revenue) informationtechnology companies located in the New York City to Virginia corridor.It invests $3 to $5 million initially and is usually the sole or leadinvestor.The fund seeks companies that have the capabilities to lead emergingmarkets. It identifies promising enterprises that will grow rapidlywith proprietary products or services. With $400 million currentlyunder management, Edison has created market capitalization surpassing$5 billion. Its strategies include venture capital, expansion financing,management buyouts, consolidations, and secondary stock purchases.The fund has invested in 10 companies providing software and servicesfor major pharmaceutical and biotechnology companies.Edison develops close working relationships with entrepreneurs andbecomes their primary business advisor. It assists portfolio companiesin strategic planning, organizational development, and capital structure.The fund welcomes investment proposals directly from entrepreneurs,investors, professional service providers, and other referral sources.It generally makes investment decisions within two months — andless when the business plan is comprehensive and it already has considerableindustry knowledge.Healthcare Ventures LLC, 44 Nassau Street, Suite200, Princeton 08542. James H. Cavanaugh, president, general partner.609-430-3900; fax, 609-430-9525. Home page: www.hcven.comOne of the world’s largest venture capital firms specializing in healthcare, Healthcare Ventures (HCV) invests in emerging growth companieswith the potential for exceptional growth. Since its formation, HCVhas created biopharmaceutical companies in genetic therapy, genomicsciences, drug discovery and delivery, neuroscience, and organ andcellular transplantation.HVC, with approximately $535 million under management, makes initialinvestments of $1 to $20 million in companies with a potential forliquidity in 3-5 years at a value of $100 million with markets inexcess of $500 million worldwide.Johnston Associates Inc., 181 Cherry Valley Road,Princeton 08540-7645. Robert F. Johnston, president. 609-924-3131;fax, 609-683-7524. E-mail: jaincorp@aol.comWww.johnstonassocinc.comJohnston Associates (JAI), founded in 1968, has launched companiesfrom the ground up around unique and commercially promising technologiesand has also financed more established small companies with demonstratedgrowth potential. Its portfolio of companies range from pharmaceuticals,diagnostics, cell separations and imaging to drug discovery and delivery,toxic waste remediation, genetic engineering and biopesticides. Someof these companies are in the early stages of development, while othershave emerged as publicly traded companies.JAI provides seed funding and assists on an on-going basis raisingmoney through private investors, financial and technical allianceswith large corporations, and strong relationships with lead underwriters.JAI invests its own private capital and does not manage an investmentfund. Because of the time-consuming nature of start-ups, JAI typicallyinvests in one enterprise a year. Its investments have ranged from$300,000 to over $3,000,000. Stringent criteria are applied to scientificachievement, market potential, uniqueness of approach, and caliberof co-founders.The firm’s current main areas of interest are therapeutics and deliverymechanisms, separations and purification technologies, databases fortherapeutic discovery, drugs from Europe, and drugs to be repositioned.New Jersey Technology Council Venture Fund, 1001Briggs Road, Suite 280, Mount Laurel 08054. Jim Gunton, Joe Falkenstein,and Robert Chefitz, general partners. 856-787-9700; fax, 856-787-9800.Home page: www.NJTC.orgThe NJTC Venture Fund invests from $300,000 to $3 million in high-techgrowth private companies in the seed, start-up and early stages (conceptto $5 million in revenues). It seeks focused businesses with the potentialto dominate a promising market niche. Capital comes from corporations,public and private funds, partnerships and individuals. The fund hascommitments of close to $30 million, which will be leveraged witha $10 million NJEDA investment from state appropriations (www.njtcvc.com).The NJTC fund seeks opportunities where its skills, experience andcontacts will contribute meaningfully to a company’s success. It generallyholds a seat on the board of directors of portfolio companies andserves as a counselor on strategic or otherwise major decisions.Jumpstart New Jersey is a new NJTC initiative. Founded in September,2002, in response to the fact that access to capital remains a criticalneed for high tech companies, it is an investor-driven group thatoffers members the opportunity to realize profits while helping todevelop new ventures through mentoring.Penny Lane Partners LP, 1 Palmer Square, Suite309, Princeton 08542. Stephen Shaffer, partner. 609-497-4646; fax,609-497-0611. E-mail: pennylanepartner@msn.comHome page:www.trautmanwasserman.net/pennylane.htmEstablished in 1996 as a Small Business Investment Company (SBIC),Penny Lane Partners, with approximately $30 million under management,is licensed and regulated by the Small Business Administration (SBA),but remains a privately-organized and privately-run investment firm.With its own capital and with funds borrowed at favorable rates fromthe federal government, Penny Lane participates in partnerships betweenthe government and the private sector, providing capital to smallindependent businesses, both new and already established.ProQuest Investments, 600 Alexander Park, Suite204, Princeton 08540. Pasquale DeAngelis, chief financial officer.609-919-3560; fax, 609-919-3570. E-mail: allisonf@proquestvc.comHome page: www.proquestvc.comProQuest Investments, founded in 1998, is a healthcare venture capitalfirm with over $250 million under management. It invests in healthcarecompanies seeking seed to late-stage financing. Its portfolio includedcompanies in the biopharmaceutical, enabling technology, medical device,and healthcare service sectors. ProQuest has a special expertise inoncology.Average investments range from $250,000 to $10 million. The firm looksfor breakthrough technologies and products with strong intellectualproperty. ProQuest focuses on opportunities in initial addressablemarkets of at least $200 million where there is a significant unmetneed for the company’s products and technology.Sycamore Ventures, 845 Alexander Road, U.S. TrustBuilding, Princeton 08540. Peter Gerry, managing director. 609-759-8888;fax, 609-759-8900. E-mail: tinas@sycamorevc.comHome page: www.sycamorevc.comSpun out of Citicorp Venture Capital in 1995, Sycamore managed morethan $550 million. Its typical investment ranges from $5 million to$15 million, distributed over several rounds of financing as a companyachieves key milestones. John Whitman, the spouse of former GovernorChristie Whitman, is among the general partners here.Sycamore has long-standing relationships with corporations, entrepreneurs,and business leaders in the Asia-Pacific region. A specialty is helpinga product company to expand markets in China and Japan.TMF: Technology Management & Funding LP, 100 OverlookCenter, Suite 102, Princeton 08540. Harry Brener, chairman. 609-921-2001;fax, 609-497-0998. Home page: www.tmflp.comTechnology Management and Funding (TMF) was founded in 1990 to uncoverand introduce breakthrough technologies, while providing commercializationand funding solutions that foster accelerated growth for early-stagetechnology companies. It moved from Research Park to Princeton Overlookearlier this month.There are very few conventional funding sources available for early-stagecompanies. This significant void in funding prompted TMF to developan alternative method to the conventional routes for bringing technologiesto the marketplace, building companies, and obtaining funds.TMF establishes relationships between early-stage technology companiesand major corporations that can involve, among other things, a jointventure, a licensing agreement, or a development contract for a definedmarket sector. The process allows the early-stage technology companyto obtain market access, credibility, and funding without losing controlof the company. The corporation, in turn, receives access to a pre-screenedand proven technology, a competitive advantage, lowered risk, andincreased market share.TMF reviews in excess of 1,000 technologies annually. Its portfoliocompanies are concentrated in software, electronics, electronics,industrial components, environmental technology, telecommunications,and biotechnology.Whitestone Capital LLC, 47 Hulfish Street, Suite505-C, Princeton 08542. James R. Utaski, partner. 609-806-0002; fax,609-806-0004.Www.whitestonecapital.comWhitestone Capital funds companies that will benefit from investmentconcurrent with board member addition.Previous StoryNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
