Venture freefall continues as focus shifts to mature firms. (Up Front).Local venture capital investments fell sharply in the fourth quarter of 2002, as Los Angeles-based start-up companies start-up company A new business. drew a smaller share of a shrinking national venture capital pie. In Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. County, eight companies attracted a total of $64.2 million in venture capital funding in the fourth quarter, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Growthink Research Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, Venture Capital Report, scheduled for release this week. That's a decline of nearly 50 percent from the $121.5 million invested locally during the third quarter, and a 38 percent drop from the year-earlier period. While venture capital activity has fallen elsewhere in Southern California and the nation, the declines weren't nearly as great as in Los Angeles County. "The amount of funding raised by Los Angeles companies in the fourth quarter was dismal," said Corey Lavinsky, president of Growthink Research. Venture activity in all of Southern California fell by 11.9 percent in the fourth quarter from the previous three months, to $474.7 million. San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. County investments fell 13 percent in the fourth quarter, while Orange County actually rose 29 percent. Due to its strength in biotech bi·o·tech n. Informal Biotechnology. biotech Noun short for biotechnology Noun 1. , San Diego, with $184.4 million raised in the fourth quarter, is far outpacing Los Angeles, Lavinsky said. Others said L.A.'s numbers could just be an anomaly. What everyone agrees on, though, is that the climate has only gotten tougher as VC firms shift their focus from early-stage companies to later-stage enterprises with good growth prospects. "If you're looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. later stage, you're looking for growth, and there aren't many growth stories out there right now," said Jeff Anderson, managing director at Mellon Ventures in Los Angeles. Online movie ticketer Fandango fandango (făndăng`gō), ancient Spanish dance, probably of Moorish origin, that came into Europe in the 17th cent. It is in triple time and is danced by a single couple to the accompaniment of castanets, guitar, and songs sung by the is a good example of the type of company attracting venture funding these days, said Anderson. Santa Monica-based Fandango, which raised $15.2 million from Technology Crossover Crossover The point on a stock chart when a security and an indicator intersect. Crossovers are used by technical analysts to aid in forecasting the future movements in the price of a stock. In most technical analysis models, a crossover is a signal to either buy or sell. Ventures and others, is gaining marketplace traction, he said, and has strong relationships with distributors. "We were lucky," said Steve Jillings, chief executive of Big Fish Communications, a Marina del Rey Del Rey may refer to:
"VCs are looking for deals where they can put their money in and they know they're not going to lose it," Jillings said. Last year, only 19 venture-backed companies were able to launch initial public offerings nationwide, according to VentureOne, a San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden research firm. A much higher number, 325, found an alternative source of liquidity by being acquired or merged. [GRAPH OMITTED]
Lucky Few
L.A.-area companies receiving venture funding in 40 2002.
Company Investment
Name Headquarters Business (millions)
Accruent Santa Monica Contract management $10
software
Ancillary Care Los Angeles Non-hospital health 1.0
Management care management
Apriso Long Beach Logistics software 2.0
Big Fish Marina del Rey E-mail anti-spam and 6.5
Communications anti-virus services
Fandango Santa Monica Online movie ticketing 15.2
IPC North Hollywood Physician and 15.5
hospital services
JAMDAT Mobile Los Angeles Mobile entertainment 8.0
products
Company
Name Partial Investor List
Accruent Sierra Ventures, Constellation
Real Technologies
Ancillary Care St. Paul Venture Capital
Management
Apriso SAP Ventures
Big Fish Sierra Ventures
Communications
Fandango Technology Crossover Ventures
IPC BA Venture Partners,
Morgenthaler Ventures
JAMDAT Mobile Qualcomm, Apax Partners,
Intel Capital, Sun Microsystems
ND = Not disclosed.
Source: Growthink Research
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