Doll Capital Management, DCM, Poised To Accelerate Investments In Innovative Communications and Internet Companies; Leading Venture Capital Firm Secures $155 Million

Business Wire, Dec 2, 1999

MENLO PARK, Calif.--(BUSINESS WIRE)--Dec. 2, 1999--

Doll Capital Management (DCM), a venture capital firm investing in early-stage communications and Internet companies, today announced the closing of its second venture capital fund - DCM II. DCM II is comprised of $155 million, more than triple the size of its first fund. The funds will be used by DCM to leverage leading-edge convergence, regulatory and technology trends in the Information Technology and Communications industries. With the closing of this new fund, DCM General Partners Dixon Doll, David Chao and Peter Moran now manage more than $200 million in committed capital.

This substantially larger capital commitment by sophisticated institutional and individual investors reflects the tremendous returns DCM has generated on behalf of its investors. In less than three years, DCM I (the firm's first fund) has generated values of more than 10-times committed capital, far exceeding virtually all investment performance norms by which top-tier VC firms are judged.

"DCM has a unique ability to select outstanding investment opportunities in the form of emerging technology companies. But not only do they identify superior opportunities, they actively help shape their portfolio companies into tremendous successes," commented Samuel Valenti III, Chairman, Valenti Capital. "As a result, DCM generates one of the industry's best returns on investment. They are a pleasure to work with and I am excited to be part of their success."

DCM has assembled an impressive portfolio of exceptional early-stage Communications and Internet companies. Its unique, hands-on involvement with its portfolio companies has attracted many stellar entrepreneurs to its fold, as well as such proven executives as Bobby Johnson, CEO of Foundry Networks.

"DCM is a true pioneer in their approach to growing business. They are not constrained by current stifling paradigms," said an enthusiastic Soon-Chart Yu, Founder and President, Gazoontite.com, to whom DCM provided incubation capital. "Their passion for the business and their portfolio companies plus their innate knowledge about how to grow a successful business make them confident in taking risks. DCM's business philosophy parallels our own - it's all about growing the business."

Reflective of its outstanding investments, DCM was the first venture capital firm to have three mega-hit transactions in a single week. During the last week of September 1999, three of its portfolio companies, Foundry Networks, InterNAP and IPivot achieved major liquidity events. DCM was an early investor in Foundry Networks (Nasdaq: FDRY), whose equipment enables leading enterprise Internet service providers to achieve dramatically higher network throughput. Foundry's stock soared a record-breaking 525 percent in the first day of trading and has since earned a valuation of more than $10 billion. During the same week, InterNAP Network Services (Nasdaq: INAP) also came public with a market cap of more than $1 billion and has subsequently increased more than five-fold in value. InterNAP is a leading provider of fast, reliable and centrally managed Internet connectivity services. To round out the firm's banner week, Intel bought IPivot, another one of DCM's early-stage investment companies, for $500 million, making it Intel's largest-ever private company purchase. IPivot is a supplier of equipment that improves Internet performance and reliability for electronic commerce usage. Some of Doll Capital's other early-stage investments include About.com, @Motion, Embark.com, Gazoontite, Iown.com, Luminous Networks, OfficeClick.com and Recourse Technologies.

"The best entrepreneurs in the world are choosing to work with us because of the unique approach we bring to the table. Unlike some of the `drive-by' investments of other venture capital firms, we truly get actively involved with our portfolio companies. We help them be successful by rolling up our sleeves and focusing where necessary; business development, partnerships, team building and development, and recruiting. We are actually doing whatever it takes to help make these companies grow and be successful," explained David Chao, General Partner at DCM.

"Our recent string of successes have made investors very enthusiastic about participating in our fund," commented Chao. "Our unique mix of domestic and international resources enables us to offer a wealth of assistance to our portfolio companies. With this new capital, we can make initial capital available to high-potential start-ups in tranches of $1 to several million - as opposed to the substantially larger bite-sizes mandated by the mega-firms"

In its newest fund, DCM has attracted an impressive roster of both new and repeat investors. These include a combination of private individuals, corporate funds and institutional capital from a variety of domestic and global organizations including 3Com, Fleet Equity Partners, Invesco Private Capital, Mesirow, NorWest Venture Partners, St. Paul Venture Capital, and a host of elite Asian organizations such as Fujitsu, Singapore National Science Board, China Aerospace, Nomura/JAFCO and Recruit, to name a few.