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7 June, 2006 - 09:35 By Staff Reporter

NVP smashes target by raising £148m seed fund

New Venture Partners in Ipswich has announced a spectacular closing of its blockbuster seed fund, the birth of which was exclusively flagged up by Business Weekly last month.

New Venture Partners in Ipswich has announced a spectacular closing of its blockbuster seed fund, the birth of which was exclusively flagged up by Business Weekly last month.

Transatlantic corporate venturing specialist, NVP smashed its initial ambitious target of $200m, announcing the successful closing of the $275m (£148m) NV Partners IV fund.

Harry Berry, who joined NVP from BT following a spin-out creation agreement between the two in 2003, said the fund was "brilliant news for the region and bright ideas around the globe."

"Investing at the very earliest stage has been central to our success, which was in turn what attracted the global institutions to invest in this fund.

"Our preparedness and ability to build world-class businesses from the raw ingredients, the people and the patents, is what has created this latest success and this is what we intend to continue doing," he said.

Berry cites the example of the recent sale of NVP portfolio company, Flarion Technologies to wireless giant, Qualcomm for $805m: "We invested in Flarion when they were just two guys and two patents."

The closing of NV Partners IV LP marks the firm’s first broad institutional fund with investors including US and European pension funds, funds of funds, endowments, financial services institutions, and family offices.

NVP first arrived on the scene in the East of England following a $100m deal with BT that saw six companies spin-out from the telco’s incubator, Brightstar. That fund, however, also backed by Coller Capital, provided only limited funds for future investments. Now NVP can invest entirely independently.

Berry said that NVP IV secured the future of venturing at BT’s Martlesham Heath research campus for at least the next five years. He said: "While funding issues may have kept me awake at night in the past, deal-flow never has, there will be plenty to come out of BT in the coming years."

The next such venture to make an impact could well be a new smart content venture, which was recently moved into incubation, according to Berry. The fledgling aims to commercialise technology that allows web adverts to be specifically tailored to multiple target audiences. "The company is working in a market that does not yet exist, but that’s the way we work – about two years down the line," said Berry.

Unlike traditional venture capital investment firms, New Venture Partners works very closely with these corporations’ R&D organisations and business groups to identify, develop, finance, and staff these new independent start-ups. To date, New Venture Partners has launched over 35 spin-out ventures.

It has venturing agreements in place with direct partners BT and Philips, but access to a host of other technologies through indirect associations. Berry said that the fund could back bright ideas at other corporate research labs around the region, including QinetiQ.

Previous local successes for NVP include Vidus, bought by NASDAQ listed @Road. and Azure, snapped up by Indian company, Subex Systems.

Matt Bross, BT Group CTO, said, "New Venture Partners has been our exclusive partner, enabling us to create six new successful ventures from our labs. The NVP team is unique in its understanding of how to manage the process of extracting people and intellectual property from the corporate environment and providing the intellectual, capital and human resources to create strong stand-alone businesses.

"The new ventures have become important strategic partners and suppliers to the core BT businesses."

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