Money Watch - Company Financial Information

Industry Standard, The, April 2, 2001

MyCFO

CEO: Art Shaw

LOCATION: Mountain View, Calif.

FUNDING: $45 million, following two rounds totaling $45 million

THE PITCH: Helping the rich manage their money

Two years ago, Netscape founder Jim Clark woke up to a problem many people would kill to have: He had amassed so much money that he didn't know what to do with it. "There was no solution to managing my finances short of hiring a team that worked just for me," says Clark, venture capitalist extraordinaire. "No one was offering a unified team of advisers with unbiased advice." So he hit on the idea of MyCFO, an advisory firm for the wealthy.

It seems like Jim Clark and his friends can still use the help. Last week, even as much of the new-economy wealth was vanishing, investors doled out another $45 million to MyCFO in a round led by Northern Trust. Repeat investors Jim Barksdale and Kleiner Perkins chipped in, joined by first-timer Amerindo Investment Advisers. The large amount (it follows two earlier rounds of $20 million and $25 million) raised eyebrows, given the exceptionally tough funding environment for most startups.

Executives point to the company's business model by way of defense. MyCFO uses technology to eliminate costly, time-consuming functions such as accumulating brokerage statements and producing balance sheets, says COO Frank Tirelli. Revenues come from fees charged to customers, and the client base has grown by word of mouth. With high net worth defined as more than $10 million, it's a club where the members know each other. Staffed with 360 employees, MyCFO expects to turn a profit in the fourth quarter of this year.

At first glance, MyCFO's funding coup may seem like a traditional case of who you know. Its board includes top-tier VCs like Barksdale and John Doerr --perhaps a necessity in the current funding environment. But investors say they need a lot more than famous names to be convinced of a company's potential. Amerindo's chief investment officer, Matthew Fitzmaurice, notes that MyCFO has an income statement and balance sheet that demonstrates it can execute against its strategy.

Other VCs agree that in the current market, a sizable chunk of funding is a vote of confidence in a company's future. Says Bruce Golden, a partner at Accel Partners: "In this environment, people are only focusing on putting capital into projects that they think can really work."

                             DEALS OF THE WEEK
VALUE [*]          DATE TARGET
VENTURE CAPITAL
   $70          Mar. 19 Onix Microsystems
   $60          Mar. 19 Equator Technologies
   $45          Mar. 19 MyCFO
   $42          Mar. 19 Winphoria Networks
   $40          Mar. 19 Watercove Networks
   $29          Mar. 19 BigMachines
   $25          Mar. 20 Context Integration
   $24          Mar. 20 Telcontar
   $23          Mar. 21 AtomShockwave
   $20          Mar. 20 Kivera
   $16          Mar. 21 Cards
   $15          Mar. 19 KSaria
   $15          Mar. 19 Network Design Tools
   $14          Mar. 20 Blue Dolphin Group
   $13          Mar. 16 TelOptica
   $11          Mar. 21 Y Media
   $10          Mar. 16 USDataCenters
VALUE [*]          DATE TARGET
M & A
$2,100          Mar. 22 True North Communications
  $550          Mar. 22 Kent Electronics
  $185          Mar. 21 Sequoia Software
   $40          Mar. 19 Intelispan
   N/A          Mar. 19 Peanutpress.com
VALUE [*]       LEAD INVESTORS
VENTURE CAPITAL
   $70          JK & B
   $60          Ironside
   $45          Northern Trust, Kleiner Perkins
   $42          Norwest, Matrix Partners
   $40          Sprout
   $29          Vista, Deutsche
   $25          Captital Resource, GE Equity
   $24          Ford, Comroad
   $23          Macromedia, Sequoia
   $20          Sun, Fremont
   $16          Citigroup, First Data
   $15          North Bridge
   $15          Pequot
   $14          Commonwealth, Matrix
   $13          Trellis
   $11          InveStar, Enterprise, J.P. Morgan
   $10          BancBoston Capital, Housatonic
VALUE [*]       ACQUIRER
M & A
$2,100          Interpublic
  $550          Avnet
  $185          Citrix Systems
   $40          McLeodUSA
   N/A          Palm
VALUE [*]       TARGET COMPANY DESCRIPTION
VENTURE CAPITAL
   $70          Optical-switching systems developer
   $60          Broadband wireless-chip systems
                developer
   $45          Financial management firm for
                high net-worth individuals
   $42          Wireless-infrastructure
                equipment maker
   $40          Mobile data-systems infrastructure
                developer
   $29          Industrial-equipment procurement
                software company
   $25          E-business software provider
   $24          Service provider for
                location-based products
   $23          Multimedia entertainment company
   $20          Location-based services provider
                for wireless devices
   $16          Smartcard transaction
                infrasturure firm
   $15          Fiber-optic component assembly
                automation company
   $15          Developer of design software
                for optical and wireless systems
   $14          Online subscription service for
                print magazines
   $13          Network-design software company
   $11          Imaging technology firm
   $10          Net infrastructure provider
VALUE [*]       THE DEAL
M & A
$2,100          Two advertising and marketing
                agencies merge
  $550          Electronics distributor acquires
                another component distributor
  $185          Server software maker buys
                XML-based portal software maker
   $40          Telecom firm buys managed networks
                service provider
   N/A          Mobile computing company acquires e-book publisher
(*.)IN MILLIONS.acquires e-book publisher
SOURCE: THE STANDARD FROM PRESS
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