News Column

Chicago Technology Venture Capital Scorecard for 2011

Page 6 of 1

When technology startups are ready to turbocharge their growth, whether that means quickly expanding into new markets or hiring additional talent, they often turn to venture capital firms.

These investors are typically interested in backing early-stage companies, betting they can work with entrepreneurs to develop the next big idea -- and jointly profit from the startup's success.

Below, you will find 17 of the area's early-stage technology investment firms and examples of their local portfolio companies. The venture capital firms differ widely in their longevity and investing strategies, not to mention the size of their war chests. But for the most part, they are united by their interest in backing homegrown entrepreneurial talent.

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BAIRD VENTURE PARTNERS

Founded: 2000 Founders: BVP is the venture fund of Baird Private Equity

Current (3rd) fund: $170 million (closed 2008)

Invested so far: About $85 million

Typical investment: Up to $10 million

Strategy: Business services and healthcare/life sciences companies. Prefers the lead investor position in first or second institutional rounds. Portfolio Companies:

PharMEDium

Founder: David Jonas

Founded: 2003

Funding: Undisclosed

Employees: 700+

Description: PharMEDium provides standard and customized drug combinations for intravenous therapies to more than 1,800 hospitals in the U.S. For example, it makes a customized mixture for use in a pump that delivers small amounts of medication to spinal fluid for pain management.

Outlook: PharMEDium is developing innovative technology platforms focusing on improving the quality of patient care delivery. Later this year, PharMEDium will launch a new product for the operating room that provides audio-visual feedback to support the anesthesia provider in verifying drug and concentration selection, as well as support the pharmacy in tracking medication utilization.



BrightTag

Founders: Marc Kiven, Mike Sands and Eric Lunt

Description: BrightTag makes software that gives website owners control over code that is planted by outside marketers to collect users' data and track their preferences.

Sittercity

Founder: Genevieve Thiers

Description: Consumers can use Sittercity's website to find providers of child care, pet care, elder care, housekeeping services and tutoring.



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HYDE PARK VENTURE PARTNERS



Founded: 2011

Founders: Ira Weiss and Guy Turner

Current (1st) fund: $18.15 million raised of a $20 million -- $25 million goal

Invested so far: About $0.8 million

Typical investment: $750,000 -- $2.5 million

Strategy: Early-stage software-as-a-service and healthcare IT companies in the Midwest

Portfolio Companies:



InContext Solutions

Founders: Bob Gillespie, Tracey Wiedmeyer and Rich Scamehorn

Founded: 2009

Funding: $1.5 million

Employees: 52

Outlook: We have strategically added 20 new employees, moved to a larger office space, seen significant wins over our competitors and remain on track to double our revenue for the second year in a row. I expect the momentum to carry through the remainder of the year and beyond, as we transition from a tech start-up into a high-growth company.

Tap.Me

Founder: Joshua Hernandez

Description: Tap.Me's technology platform allows brands to advertise within social and mobile games in integrated ways that don't interfere with gameplay.



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I2A FUND



Founded: 2007

Founders: Kapil Chaudhary and Stuart Larkins

Current fund: $10 million (I, closed 2007)

Invested so far: Fully invested

Typical investment: $250,000 -- $1 million

Strategy: Early-stage Illinois companies in technology-enabled services, new media and education, and consumer and retail products.

Portfolio Companies:



Red Foundry

Founders: Jim Heising, Ron Franczyk and Andrew Newman

Founded: 2009

Funding: $2.8 million

Employees: 15

Outlook: We just launched a tool for app developers to more easily integrate features from other apps and services. This ability to quickly create a mashup offers an alternative to traditional advertising. We'll be focused on rolling these options out to developers like Fodor's Travel and service providers like Expedia so users can book hotels and other travel deals from within the Fodor's App.

SoCore

Founders: Glen Tullman and Pete Kadens

Description: SoCore installs commercial solar-power systems for customers that include retailers such as IKEA and JCPenney.

YCharts

Founders: Shawn Carpenter and Ara Anjargolian

Description: YCharts provides stock research and analysis, with an emphasis on easy-to-understand data visualization tools.



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ILLINOIS VENTURES



Founded: 2002

Founders: Launched by the University of Illinois

Current (2nd) fund: $70 million (closed 2009)

Invested so far: About $35 million

Typical investment: $1 million -- $3 million

Strategy: Early-stage, research-based companies in information technology, physical sciences, life sciences and clean technology.

Portfolio companies:



Local Offer Network

Founders: Dan Hess, Greg Hart and Jorge Zapata

Founded: 2010

Funding: $1.5 million

Description: LON, a daily deal aggregator, offers services such as a syndicated daily deal feed for publishers to offer discounts to their audience and runs dealradar.com, a consumer-facing website.

Diagnostic Photonics

Founders: Stephen Boppart and Scott Carney

Description: Diagnostic Photonics makes imaging technology that helps clinicians see cellular tissue structures and evaluate diseased tissue during surgical procedures.



Chromatin

Founders: Daphne Preuss and Greg Copenhaver

Description: Chromatin is a biotechnology company that develops new seed products and renewable, plant-derived materials that can be used by power, fuel and chemical producers.

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LEO CAPITAL



Founded: 2000

Founding partner: Randy Rissman

Current fund: $25 million

Invested so far: Undisclosed

Typical investment: $1 million -- $3 million

Strategy: Companies with high-growth potential in industries such as kids' entertainment, wireless technology, consumer e-commerce and social media.

Portfolio Companies:



Media Chaperone

Founders: Ed Lewis and Dave Shemenski

Founded: 2010

Funding: $1.25 million

Employees: 5

Outlook: We are launching a Family Gift service that allows parents to invite extended family to participate in a gift purchase via Facebook. Later this year, we will launch a mobile family platform, allowing parents to set permissions for mobile apps and purchasing by their kids.



EpiWorks



GrubHub

Founders: Mike Evans and Matt Maloney

Description: GrubHub's website and mobile applications connect consumers with restaurants in their area that deliver food.



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LIGHTBANK



Founded: 2010

Founders: Eric Lefkofsky and Brad Keywell

Current fund: $200 million (closed 2011)

Invested so far: Less than $100 million

Typical investment: $500,000-$1 million for a seed round; $1 million-$3 million for Series A

Strategy: Early-stage companies in large, high-growth industries such as social media, the consumer Web and business-to-business technology.

Portfolio Companies:



BodyShopBids

Founder: Brad Weisberg

Founded: 2011

Funding: $1.25 million Employees: 9

Description: Car owners can use BodyShopBids' website or mobile app to upload a photo of their damaged vehicle. Local body shops bid on the repair work and customers can book appointments online. Outlook: I've been overwhelmed with how grateful people have been for taking a frustrating process and making incredibly simple. Our goal is to create a turn-key solution for car repair that benefits customers, body shops and insurance carriers.



BenchPrep

Founders: Ashish Rangnekar and Ujjwal Gupta

Description: BenchPrep makes test preparation courses that can be accessed on the Web, iPhone, Android or iPad.



Sprout Social

Founder: Justyn Howard

Description: Sprout Social's technology helps companies manage their social media presence through publishing updates across platforms, managing teams and measuring results.

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MK CAPITAL



Founded: 2003

Founders: Bret Maxwell, Mark Koulogeorge, Karen Buckner and Mark Terbeek

Current (2nd) fund: $250 million (closed 2011)

Invested so far: $125 million

Typical investment: $2 million -- $5 milliStrategy: Interested in digital media, marketing automation, software and education technology.

Portfolio Companies:



Eved Founder: Talia Mashiach

Founded: 2010

Funding: $12.3 million

Employees: 30+

Description: Eved's technology platform automates the buying and selling for meetings and events.

Outlook: We are focused on continuing to increase online transactions and have shown a 150% increase over the last year in transactions.



CellTrak

Founders: Andrew Kaboff and Steven Wegner

Description: CellTrak specializes in mobile technology for home and hospice care providers, allowing aides and nurses to accurately collect, organize and access patient information.

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SANDBOX INDUSTRIES



Founded: 2004

Founders: Nick Rosa and Bob Shapiro

Funds: Sandbox runs two funds that are fully invested, the Sandbox Venture Fund ($18.8 million, closed 2008) and the Blue Cross Blue Shield Fund I ($116 million, closed 2008). It has two new funds, the Sandbox Advantage Fund ($50 million) and the Blue Cross Blue Shield Fund II ($179 million).

Typical investment: $1 million-$2 million for the Sandbox Advantage Fund; $1 million-$10 million for the Blue Cross Blue Shield Fund II.

Strategy: The Blue Cross Blue Shield Fund II focuses primarily on health care information technology. The Sandbox Advantage Fund will co-invest with the health care fund and also back internally generated projects. Portfolio Companies:



CakeStyle

Founders: Cecelia Myers and Millie Tadewaldt

Founded: 2011

Funding: Undisclosed

Employees: 12

Description: CakeStyle is a personal shopping service for women. Customers complete an interview with a stylist, either virtually or in person, and receive a customized box of clothing and accessories every season. Outlook: We're bringing our CakeStylists to cities across the U.S. in the next year via our pop-up shops. We want women all over the country to be able to meet their stylist face-to-face and learn about CakeStyle. We're starting by offering more appointments than ever in Chicago, and our next stop is San Francisco.

Doggyloot

Founder: Ryan Schoop

Description: Doggyloot is a daily deal company for dog owners.



Alltuition

Founders: Sue Khim, Sam Solomon and Silas Hundt

Description: Alltuition makes online tools for families to manage educational debt and the financial aid process.



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APEX VENTURE PARTNERS



Founded: 1987

Founder: James Johnson

Current (6th) fund: $140 million (closed 2007)

Invested so far: Declined to answer.

Typical investment: $200,000 to $6 million

Strategy: Apex focuses on technology-enabled services, information technology and clean technology sectors.

Portfolio Companies:



Trunk Club

CEO: Brian Spaly

Founded: 2009 Funding: $11 million Series A

Employees: About 90

Description: Offers men a less time-consuming way to shop by shipping clothes to try-on and only charging them for what they keep.

Outlook: "We currently have 11,000-plus customers and hope that by the end of next year we have over 100,000," Spaly said.



Target Data

Founders: Ross Shelleman and Dr. Andrew Hamilton

Description: Data, analytics and direct mail for targeted marketing



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ARCH VENTURE PARTNERS



Founded: 1986

Founders: Steven Lazarus, Keith Crandell, Clinton Bybee and Robert Nelsen

Current (7th) fund: $400 million (closed 2007)

Invested so far: About $300 million

Typical investment: $100,000 through "several million"

Strategy: ARCH specializes in the so-called "hard sciences," including advanced semiconductors, biotech, instrumentation, chemicals, etc. They work with researchers at universities and national laboratories to commercialize their innovations. Portfolio Companies:



Univa

CEO: Gary Tyreman

Founded: 2004 with a major pivot in 2010

Funding: $9.5 million in Series E and A (post-pivot)

Employees: 25-plus

Description: A product that helps companies efficiently spread research and development work across multiple computers.

Outlook: Univa projects doubling its business this year, while growing its customer base four times. Half of this growth will come from Europe and Asia.



PixelEXX Systems

Founders: Dr. Samuel Wickline, Stuart Solin, Kirk Wallace and Mike Hughes

Description: Developing a new way of imaging DNA, proteins and cells for medical and pharmaceutical research



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OCA VENTURES



Founded: 1999

Founders: Jim Dugan, John Dugan and Peter Ianello

Current (2nd) fund: $50 million (closed 2008)

Invested so far: About $32 million

Typical investment: $50,000 to $100,000 for seed investments; $500,000 to $2 million for main funds

Strategy: OCA typically leads or co-leads initial funding rounds. It recently launched OCA EDGE, which provides seed capital, often to consumer-facing web and mobile-commerce startups. Portfolio Companies:



Apparel Media Group

Founder: Jared Golden, Gerry Hays and Amish Tolia

Founded: 2009

Funding: $1.8 million from seed and Series A rounds

Employees: 10

One sentence description: Enables companies to advertise through hyper-local sponsorship programs; for example, Gatorade sponsoring a kids' soccer team or AXE sponsoring college student groups. Outlook: Apparel Media currently helps businesses reach groups in the offline world (via merchandise), but this year the company is launching its first consumer-facing platform, called Pear. The app enables school groups, sports teams, etc. to earn sponsorships by promoting a business of their choice via social media.

Power2Switch

Founders: Seyi Fabode and Phil Nevels

Description: Helps consumers acquire cheaper electricity with a few mouse clicks.



Cleversafe

Founder: Chris Gladwin Description: Developed and offers a cutting-edge storage method for big data



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ORIGIN VENTURES



Founded: 1999

Founders: Steven Miller and Bruce Barron

Current (2nd) fund: $15.2 million (closed 2005)

Invested so far: All of it. Typical investment: $1 million to $2 million

Strategy: Origin specializes in e-commerce, social media and software as a service companies. They target Chicago-area and Midwestern companies. Portfolio companies:



Ifbyphone

Founder: Irv Shapiro

Founded: 2005

Funding: $17.6 million in Series A and B rounds

Employees: 70

Description: Using unique phone numbers, Ifbyphone tracks the sources of companies' incoming calls, thereby measuring the strengths of different online and offline advertising tools. Outlook: Their goal is to double revenue and penetrate their technology deeper into several sectors, including real estate and home services. Each of these sectors relies heavily on phone conversations to close business.



GrubHub

Founders: Matt Maloney and Mike Evans

Description: An online food-ordering service



ClaimForce

Founder: Dennis O'Mahoney

Description: Helps insurance companies streamline their claims processing

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KB PARTNERS



Founded: 1996

Founders: Keith Bank and Byron Denenberg

Current (2nd) fund: $75 million (closed 2001)

Invested so far: All of it.

Typical investment: $3 million to $5 million

Strategy: KB Partners is in the process of winding down its operations and working with its four remaining portfolio companies toward exits. Meanwhile, Bank and Denenberg are investing their own capital as angel investors. Their investments range from $250,000 to $4 million.

Portfolio Companies:



Club Champion Golf

Founders: Keith Bank and Joe Lee

Founded: 2010

Funding: $1.15 million in Series A

Employees: 18

Description: A golf club custom-fitting and building service.

Outlook: Club Champion has four locations — three in the Chicago area and one in Philadelphia — and will open two more this year.



Fusion Risk Management

Founder: David Nolan

Description: Cloud-based risk management software



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EXCELERATE LABS



Founded: 2010

Founders: Troy Henikoff, Sam Yagan, Sandbox Industries and the I2A Fund

Current (2nd) fund: $1.5 million (closed 2011)

Invested so far: About $1 million

Typical investment: $25,000 in return for 6 percent equity

Strategy: Excelerate Labs is Chicago's leading incubator, meaning it admits about 10 startups annually and puts them through a three-month boot camp. The process concludes with Demo Day, where each company pitches to an audience of about 500 potential investors at the House of Blues.

Portfolio Companies:



Cureeo

Founder: Maida Swenson-Fortune

Founded: 2011

Funding: $25,000 via Excelerate Labs

Employees: 3

Description: An online marketplace for fine art.

Outlook: "In the coming year, we plan to create a substantial network of exceptional artists and to demystify the art buying process for thousands of people," Swenson-Fortune said.

Good Karma Clothing for Kids

Founder: Sharon Schneider

Description: A subscription service for baby clothes



Fibroblast

Founders: Dr. Andrew Albert and Scott Vold

Description: A cloud-based tool that helps doctors and patients with scheduling and referrals.



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FIRESTARTER FUND



Founded: 2012

Founders: Matt Moog and Brian Hand

Current (1st) fund: $5.7 million (closed 2012)

Invested so far: $525,00

Typical investment: $75,000 to $200,000

Strategy: FireStarter focuses on software as a service, e-commerce, and digital media and marketing. It invests in companies that are at or near revenue generation, with a business plan and well-developed technology. Portfolio Companies:



Retrofit

Founder: Jeff Hyman

Founded: 2011

Funding: $2.7 million in seed and Series A rounds

Employees: 20

Description: Retrofit is a weight-loss program that heavily relies on technology, including wireless activity trackers and wi-fi scales.

Outlook: "Our sole focus is making Retrofit the best possible product," Hyman said. "If we do that, and people successfully lose weight, the rest will take care of itself."

Kapow Events

Founders: Marc Halpin and Daniel McCormick

Description: Helps large companies host events for 20 to 100 guests — clients can select between pre-packaged or customized options



Tap.Me

Founder: Joshua Hernandez

Description: A technology platform that allows companies to advertise within mobile games.



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CERES VENTURE FUND



Founded: 2005

Founders: Sona Wang, Donna Williamson and Laura Pearl

Current (1st) fund: Undisclosed (closed 2006)

Invested so far: Two-thirds

Typical investment: $250,000 to $1 million

Strategy: Ceres focuses on health care, information technology and business services. About half of their deals involve women-led companies.

Portfolio Companies:



Zorch

Founder: Nicole Loftus

Year Founded: 2002

Funding: $7 million in Series A, B, C

Employees: 45

Description: Promotional products (mugs, T-shirts, pens) distributor for large businesses

Outlook: Zorch just launched a new technology that makes its sourcing process for T-shirts, mugs, hats, etc. more efficient, so clients, such as Citigroup and Chevron, save money.



Brill Street

Founders: David Frej and Nancy Lerner

Description: Helps companies find entry-level/Gen Y workers, often using social media



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NEW WORLD VENTURES



Founded: 1996

Founders: J.B. and Anthony Pritzker

Current Fund: Not applicable. The Pritzkers invest their own capital and do not raise money from outside investors.

Invested so far: Not applicable. It's a perpetual fund, meaning they are always open to deals.

Typical investment: $3 million to $25 million

Strategy: The Pritzkers, who are brothers, are looking for seasoned entreprenuers who have previously led or worked at startups and are focused on solving problems in large, growing markets. They occasionally make seed investments of $50,000 to $1 million.

Portfolio Companies:



Analyte Health

Founders: Dan Malven and Michelle Sobel

Founded: 2008

Funding: $14 million in Series A and B

Employees: 75

Description: Operates sexualhealth.com and STDtestexpress.com, which enables people to remotely order an STD test and receive the results online.

Outlook: "We hope to be the largest online STD clinic a year from now," said CEO Sridhar Murthy. The company will upgrade its services this fall, including accepting insurance and expanding its test offerings.

Sportvision

Founders: Stan Honey, Jerry Gepner and Bill Squadron

Description: A creator of sports marketing technology, most notably the yellow first-down line during NFL broadcasts.



SMS Assist

Founder: Mike Rothman

Description: Uses online technology to help companies manage and maintain buildings



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