Prism VentureWorks Finds fertile ground in L.A. market.

AS an established venture capital firm in the mature Massachusetts market, the partners at Prism VentureWorks decided to open their second office in a decidedly different environment.

Gordie Nye, a general partner at the firm, headed west in 2005 to open the firm's Santa Monica office in the young and largely untapped L.A. life sciences venture capital market.

"The decision to come west was an important one," said Nye, who opened the office by himself. "There was pressure on me to make the West Coast office happen and happen well. It turns out that West L.A. is a perfect place for a company doing what we want to do."

Specializing in life sciences, new media and technology ventures, the firm found fertile ground in the developing L.A. market. Today the office has four partners, with Nye and partner Tony Natale leading the life sciences division.

Prism is an early-stage investor with about $1.25 billion under management spread among five funds. The firm has enjoyed some success recently with its life science investments. including the sale this month of BioRexis Pharmaceutical Corp. to Pfizer Inc.

"Southern California is rapidly growing as a venture capital market," said Natale, who joined the firm last November. "There's a wealth of opportunities in Los Angeles. It's a pretty wide open landscape in terms of folks who do life science venture."

Nye and Natale traveled different paths to their current positions as specialists in medical device companies. Nye, 52, held marketing, sales and management positions for companies such as L.A. Gear and Reebok for 15 years before transitioning into medical device companies.

He also served as chief executive of several companies, including Critikon, which makes patient monitoring devices, and Reva Medical Inc., which develops stents that the body can absorb.

With extensive business management expertise and a passion for the development of new medical devices, Nye wanted to make a transition to venture capital. "I wanted to formalize my passion for new product investing," he said.

Nye now serves on the board of nine companies, including Menlo Park-based iScience Surgical Inc. and Atritech, a Minnesota firm. He recently joined the board of People Jam, a Santa Monica company for which Prism provided seed financing.

Unlike Nye, Natale started in medicine and then moved to the business side, Natale, 34, is a head and neck surgeon by training. But some entrepreneurial efforts piqued his interest in business management and investing.

He developed investment knowledge in a wide swath of medical sectors, from orthopedics to neurology to surgical robotics. As Natale began to work with more venture groups one thing led to another.

"I eventually decided that I would make the switch and do this full time," he said.

Working in the L.A. life sciences venture capital market also provides opportunities through its proximity to San Diego, which has a more mature biotech market. Natale said he enjoys having the chance to sift through emerging technologies to find out which advancements area worthy of being funded.

But for all of the firm's early success in expanding to the West Coast, Nye said there are significant obstacles: "There are communication challenges: The time difference and scheduling in general are fairly daunting aspects Of the two-office shop."

And though the partners consider the expansion successful, their Los Angeles deals have faced the same difficulties that venture firms across the country face.

"It is always a challenge to find good people and good technologies and that's what makes the venture business interesting," Natale said.

RICHARD CLOUGH 

Staff Reporter