On Venture 2003 Eve, Few Deals Being Done Across Southeast

As the Southeast gears up for one of its premier venture capital conferences, Venture 2003, the region remains in a funding funk, with only a couple dozen deals completed so far this year for a little over $235 million. That compares to about $300 million at this point a year ago … which, if you remember, was not a banner year for venture activity.

This past week produced two deals: Ephinay of Charlotte, an outsourcer for IT-intensive finance and accounting services, raised a $10 million first round from an Indian venture firm, while Atlanta-based Quellan, which designs high-speed circuits for telecom applications, nabbed $3 million from a group of existing investors and National Semiconductor.

Venture-hungry entrepreneurs better hone their business plans before putting on their networking caps at the Venture 2003 conference Tuesday and Wednesday in Chapel Hill if they expect the spigots to be turned on again anytime soon. Once there, they had better schmooze till they drop, getting in front of as many of the dozens of VCs expected to attend as possible.

Here is LTW’s exclusive list, ranked according to the size of the deal, for the Carolinas and Georgia:

Company; Sector; Amount (Round)

1. New South Communications, Greenville, S.C.; Telecommunications; $63.5 million (NA)

Investors: Kohlberg Kravis Roberts, M/C Ventures, Quadrangle Group, Vaxa Corporate Partners and Wachovia Partners

2. TransTech Pharma, High Point; Pharmaceuticals; $24 million (NA)

Investors: Cephaton, MacAndrews & Forbes and Novo Nordisk A/S

3. Prenova, Atlanta; IT services; $15.5 million (NA)

Investors Austin Ventures, Frontenac and River Cities Capital Funds.

4. Targacept, Winston-Salem; Biotech; $14 million (2nd)

Investors: Bison Capital, Cogene Biotech Ventures, JAFCO, Nomura International, Oxford Bioscience Partners and Rock Castle Ventures

5. STI Knowledge, Atlanta; Software; $14 million (1st)

Investors: BV-Cornerstone Ventures, Mellon Ventures and individuals

6. nuBridges, Atlanta; Software; $11 million (NA)

Investors: C&B Capital, GMT Capital, hf Flagship Investments, Noro-Moseley Partners, Tycho and Marie Hawle Foundation and individuals

7. Arsenal Digital Solutions, Cary; IT services; $10.5 million (4th)

Investors: Covestco, Southeast Interactive Technology Funds and Southern Cross Capital

8. Ephinay, Charlotte; Services; $10 million (1st)

Investors: Chrys Capital

9. StemCo Biomedical, Durham; Biotech; $9.8 million (2nd)

Investors: Aurora Funds, Becton Dickinson Ventures, Intersouth Partners, Tall Oaks Capital and Trelys Venture Partners

10. OrthoNeuro, Charlotte; Medical; $8.5 million (NA)

Investors: New Enterprise Associates

11. Venetica, Charlotte; Software; $7 million (1st)

Investors: Charles River Ventures and General Catalyst Partners

12. Brickstream, Atlanta; Software; $6.2 million (1st)

Investors: Columbia Capital and Mohr Davidow Ventures

13. Lancope, Atlanta; IT Services; $5 million (2nd)

Investors: HIG Ventures and GMG Capital Partners

13. Oculan, Raleigh; Networking; $5 million (4th)

Investors: Soros Equity Partners

15. USA Staffing, Greensboro; Services; $4 million (NA)

Investors: Argosy Investment Partners II and Venture Capital Partners

16. Q1 Labs, Atlanta; Software; $3.3 million (1st)

Investors: Business Development Bank of Canada and New Brunswick Investment Management

17. Flexlight, Atlanta; Networking; $3 million (2nd)

Investors: Coral Ventures and Concord Ventures

17. Quellan, Atlanta; Hardware; $3 million (NA)

Investors: Cordova Intellimedia Ventures, Greenspring Ventures, ITU Ventures, National Semiconductor, University Financing Foundation and Yamacraw Seed Capital Fund III

19. Qcept Technologies, Atlanta; Hardware; $2.1 million (NA)

Investors: Pittco Capital Partners( lead), Atlanta Technology Ventures and Bergman & Associates

20. Relativity Technologies, Cary; Software; $2 million (4th)

Investors: Noro-Moseley Partners and Wakefield Group

20. AvidXchange, Charlotte; Software; $2 million (2nd)

Investors: Charlotte Angel Partners, Piedmont Angel Network and and individuals

21. RSS Solutions, Greenville; Software; $1.6 million (NA)

Investors: Edgestone Capital Partners

22. LiveWire Logic, Morrisville; Software; $1.5 million (3rd)

Investors: Gray Ventures and Research Triangle Ventures

23. Trinity Security, Charlotte; IT services; $1.5 million (1st)

Investors: Venture Capital Solutions