New Venture Funds, Sympoz’s Big Score are Top Colorado Stories for 4Q
With 2013 finally in the books, here’s a rundown of some of the top stories from the final three months of the year.
-VC firms close 2013 with a flourish
Colorado’s small community of venture capitalists seized the spotlight in late December, with news emerging that two prominent local firms were seeking to raise funds of at least $100 million apiece.
David Cohen made the biggest splash. His personal firm, Bullet Time Ventures, filed paperwork with the SEC detailing plans to raise a $150 million fund, which would be Cohen’s third fund and by far the largest.
Cohen is best known as the co-founder and CEO of the Techstars startup accelerator, but he’s also been an active angel investor for years and became a so-called micro-VC in 2009 when Bullet Time Ventures raised its first fund.
A day later, Boulder Ventures filed paperwork stating it was raising a $100 million fund. Boulder Ventures has deep roots in the area, raising its first fund in 1995. It’s a regionally focused fund, with Kyle Lefkoff and Peter Roshko managing its Colorado investments.
The firm had been quiet for a while, but in 2013 it saw two strong exits. It was an early investor in Rally Software Development (NYSE: RALY), which went public in April. LineRate Systems, a startup specializing in software-defined networking, was acquired by F5 Networks in February for $125 million.
Cohen and the partners at Boulder Ventures are keeping quiet about their funds until the rounds close, so the strategies they’ll follow and type of investments they’ll make remain to be seen. Judging by past investments, though, Cohen might continue with the angel-like approach he’s followed, while Boulder Ventures could invest in Colorado companies that are close to home.
Last but not least, the Foundry Group keeps raising money, closing a new $225 million fund in October. The fund, Foundry Group Select, is the same amount as the firm’s other three funds, but it has a different focus. While the earlier funds were dedicated to early stage startups, the select fund will be used to continue investing in those startups as they mature.
-Clovis buys Italian company, expands pipeline
This time a year ago, things were looking down for Clovis Oncology (NASDAQ: CLVS), an early stage drug development company based in Boulder. Its first drug candidate had failed and its stock price was in the basement.
But the company’s fortunes took a dramatic turn for the better this spring, with two drugs showing potential in early trials.
The good run continued this fall, with Clovis buying Italy-based Ethical Oncology Science, or EOS, for $200 million. The deal gives Clovis exclusive development and commercialization rights to market lucitanib, a drug that could treat breast, renal, and thyroid cancer, in the U.S. and Japan.
Clovis paid $10 million in cash for EOS, and the remaining $190 million was stock that EOS’ former owners have begun selling off. They also could receive milestone payments if lucitanib makes it to the market and becomes a success.
-Sympoz graduates from startup ranks?
Sympoz might want to take a bow as the year ends. The company behind the online learning site Craftsy closed a $35 million Series C round and landed large private equity firm Adams Street Partners as an investor. The Chicago-based company’s portfolio included RetailMeNot (NASDAQ: SALE), which had a $230 million IPO in 2013.
2013 was a year of growth for Sympoz, which moved into a large office in downtown Denver earlier this year and received a tax incentive package from the state. With the new VC round, Sympoz has raised a total of $56 million, making it part of the small group of Colorado startups like Denver-based Ping Identity and Boulder-based SolidFire and LogRhythm that have thrived during their early years, raised multiple large VC rounds, and now seem on track for a big exit or IPO, along the lines of Rally Software (NYSE: RALY), which went public in April.
-SolarWind buys Confio for $103M
The year 2013 saw a handful of early stage startups selling for more than $100 million to public companies. In October, it was Confio Software’s turn. Austin, TX-based SolarWinds (NASDAQ: SWI) bought the company for $103 million in a deal that closed in early October.
Confio was based in Boulder and made database performance management software. The company made about $15 million per year at the time of the deal, and according to SolarWinds CEO Kevin Thompson other buyers were pursuing the company.
Confio had about 70 employees and 1,200 customers when the deal was announced.
-Colorado companies give back
2013 has been a good year for Colorado tech companies, so it’s fitting that they give back to local and global causes in innovative ways.
Rally gave back in the most traditional sense, giving $1.3 million to charities. The money came from equity the company donated to a local nonprofit when it was a startup. A large amount of the total also went to its own Rally for Impact Foundation.
MGive closed the year by doing good in a different way by helping charities raise money for the victims of the November typhoon that struck the Philippines. The Denver-based company manages the IT for fundraising campaigns for nonprofits that accept donations by text message.
Finally, satellite imagery provider DigitalGlobe (NYSE: DGI) tried to help in a more unconventional way. The company’s Tomnod unit develops tools that help the crowd tag images from space. Following the typhoon, it used its platform to create a catalogue of damaged buildings and infrastructure in the disaster area.