COLUMBIA, S.C. – An experienced management team and a potentially lucrative market have combined to entice Trelys Venture Partners to make its first investment.

Trelys, which recently had an initial closing on what managers hope will become by the end of the year a $40 million fund targeting technology firms in South Carolina, put $1.25 million into iOnosphere, an international telecommunications firm based in Greenville, S.C.

“Business in that (telecom) market has been struggling, but iOnosphere has not only survived, it’s been increasing revenues,” says Trelys fund manager Adrian Wilson, who joins iOnosphere’s board of directors as part of the deal. “As the telecom market revives, they’re well positioned to become leaders in their sector.”

Founded two years ago, iOnosphere provides telephony and Internet services to key markets in developing countries in Latin America, Africa, Asia and the Middle East, where state-run utilities are being deregulated under pressure from the World Bank and International Monetary Fund.

The company is reselling long-distance in countries like Bolivia and Bangladesh and is using new technologies to provide their own local, long-distance and Internet services without a huge upfront investment.

“As deregulation continues, they’re going to have an established position in these markets, which will be very attractive to larger players,” Wilson says.

iOnosphere officials say gross profits are growing at 30 percent each month, and operations have been cash-flow positive the past two months. They are forecasting $60 million in revenue for 2002 and expect to be profitable by the end of the year.

Wilson says he also found iOnosphere’s management team attractive. Chief Executive Leighton Cubbage was sales director of a long-distance company that MCI eventually purchased, and he founded another long-distance company in the late 1980s that he later sold to LCI International. The company’s technology chief also has two decades of telecom experience, while its financial head is a former partner at KPMG.

The deal with Trelys completes a $7 million funding round for iOnosphere, which was led by Pharos Capital of Nashville, Tenn. Pharos also led a $25 million round in the company a year ago.

For earlier stories on Trelys see:

Starved companies flood Trelys with business plans:

New venture fund launched in South Carolina: