Early Results In for Venture Fund-Raising, OpenCandy Sees Sweet Growth, UCSD B-School Launches Venture Fund, & More San Diego BizTech News

1/19/10Follow @bvbigelow

It’s that time of year when young analysts turn to thoughts of venture investments won and lost. We’ve got the early returns, and more details will shake out in coming weeks, so get a head start now.

—It was the best of times, it was the worst of times. Venture investments in cleantech startups nationwide fell by 38 percent in the fourth quarter that ended Dec. 31, compared to the third quarter of 2009, according to ChubbyBrain, a New York firm that tracks data on high-growth private startups. Yet investments in Internet startups soared during the quarter. The overall amount of fourth-quarter venture capital investments declined to $5.5 billion nationwide, compared with $5.9 billion during the fourth quarter of 2008, but ChubbyBrain counted 687 fourth-quarter deals nationwide, the highest number in five quarters.

—On another front, funds flowing into U.S. venture firms by college endowments, wealthy individuals, and other limited partner investors fell by almost 55 percent in 2009, compared to 2008, according to Dow Jones LP Source. In San Diego, the private equity firm Capital Creek Partners of suburban Rancho Santa Fe raised $50.7 million in the sole funding that showed up last year.

SAIC (NYSE: SAI), the Virginia-based government contractor that was founded in San Diego, agreed to acquire cybersecurity firm CloudShield Technologies of Sunnyvale, CA. Since its founding in 2000, CloudShield reportedly had raised about $75 million from investors that include D.C.-based Paladin Capital Group; Foundation Capital of Menlo Park, CA; Fuse Capital of Palo Alto and Los Angeles; TPG Ventures of Fort Worth, TX, and San Francisco; and Tektronix of Beaverton, OR. The companies did not disclose financial terms of their deal.

—San Diego-based OpenCandy, which was founded by six ex-DivX employees in 2007, is growing fast and might consider raising a secondary round of venture capital later this year, according to CEO Darrius Thompson. OpenCandy, which now has 20 employees and is still hiring, raised $3.5 million in Series A funding in late 2008 from Bessemer Venture Partners, O’Reilly AlphaTech Ventures, and some prominent individual investors. The company’s website helps to connect free software publishers and advertisers.

UCSD’s Rady School of Management has formed a new source of startup capital for San Diego entrepreneurs. The new Rady Venture Fund plans to make investments that range between $75,000 and $100,000 in a program that’s primarily intended to help MBA students at Rady learn the ropes of venture capital.

MeLLmo, the Del Mar, CA-based startup that created a mobile business intelligence application for Apple’s iPhone, said South Africa’s Vodacom has selected its Roambi app to provide real-time, critical business information to its workforce.

SG Biofuels said it has formed a strategic alliance with Life Technologies (NASDAQ: LIFE), the Carlsbad, CA-based maker of genetic diagnostic equipment, laboratory instruments, and other biotech supplies. Using Life Technologies’ genetic analysis tools, SG Biofuels said it will be able to produce improved cultivars of Jatropha, a bushy crop the company is developing as a potential source of biofuels.


Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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