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In the News

August 2, 2004

Blood-Red Envelope
An article in today’s New York Times examines a looming dot-com boardroom smackdown that will pit Michael Moritz, a towering Silicon Valley VC, against Scott Galloway, the founder of the company in question: Redenvelope.com. Galloway, who has relinquished most of his control of the company, believes Moritz – the Chairman of the Board – is taking the company in the wrong direction. In an effort to stop Moritz, Galloway is “forming a dissident shareholder group,” to push through a set of strategic changes. The vote will take place on August 27. We wish Mr. Galloway luck with his wildcat maneuver – and trust that he has no plans to start a company with VC money in, say, the next 75 years. VCs have famously short memories when it comes to their own bad investments – and famously long ones when it comes to contentious entrepreneurs.
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You want a piece of me?
Sequoia Capital’s Michael Moritz

The article accurately depicts Moritz as “one of Silicon Valley’s least sentimental investors” – but this may be understating the matter. We’ve seen Moritz in action in the boardroom and he’s not afraid to tell you exactly what he wants. And that’s usually a lot more than you want to give up.
Engenio Pulls IPO
Although the news garned little attention in the press, you bet it caught the attention of bankers and VCs. Ingenio was to have sold 12.5M shares via Morgan Stanley and Goldman, Sachs, raising roughly $125M, but made the decision to postpone as a result of weak feedback on its road show. The Street seems to be giving a greenlight to select IPOs, namely Salesforce.com and Google, but is giving the no-no to second-tier IPOs such as Engenio. A subsdiary of LSI Logic, Engenio Information Technologies sells controllers, disk arrays and storage management software.
Fresh Deals
Frontbridge Technologies
Sector: Enterprise software – anti-virus, anti-spam
HQ: Marina Del Rey, CA
Action: $10M Series D (oversubscribed)
Investors: Focus Ventures (lead) Sierra Ventures, BA Ventures Partners, Kummell Investments and Waitte Ventures
Sanrad
Sector: Storage
HQ: Jerusalem, Israel
Action: $8M investment
Investors: Sequoia Capital
Array Networks
Sector: Security
HQ: Campbell, CA
Action: Raised an additional $5.5M in its fourth round of funding to close the round with $13M.
Investors: U.S. Venture Partners and Comdisco Ventures.
Mirage Networks
Sector: Networking
HQ: Austin Texas
Action: $13M Series B
Investors: Trinity Ventures (Lead), Adams Capital Management, CenterPoint Ventures
Cambridge Display
Sector: Hardware – display technology
HQ: Cambridge, UK
Action: Filed for $40.25M IPO
Underwriters: SG Cowen & Co., CIBC World Markets, and Adams, Harkness & Hill.

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