State-Run Venture Fund Succeeds With Native Firms

When Sourcefire I nc. , a systems security software company, sold this month for $225 million in cash, some of the biggest names in venture capital chalked up a major payday. Four VC firms, including local shops New Enterprise Associates and Core Capital Partners , collected about six times their $34 million investment in the Columbia-based firm since 2001.

But perhaps the people most responsible for getting Sourcefire off the ground were a few mid-level state employees in Baltimore who run one of the most successful early-stage venture funds in the region, the Maryland Venture Fund . Their investment of $550,000 of public money in Sourcefire in 2001 — when Sourcefire founder Martin Roesch was developing the software in his Carroll County basement — netted $3.9 million when the company was sold.

The Maryland Venture Fund was started in 1994 and is a leader among state-run funds. About 35 other states have venture funds of some kind, but none is as large as Maryland’s. Most, including funds in the tech centers of California and Massachusetts, offer much smaller equity investments, focusing on technology transfer from research institutions.

By Terence O’Hara

Full Story: http://www.washingtonpost.com/wp-dyn/content/article/2005/10/23/AR2005102300786.html?nav=rss_technology

***

Colorado’s venture capital soaring

Biotechnology and technology deals have helped eclipse the $386.8 million through all of last year. Louisville’s Replidyne landed one of the nation’s biggest chunks.

By Will Shanley
Denver Post Staff Writer

Venture capital raised by Colorado companies continued to trend upward in the third quarter, buoyed by a large biotechnology deal and several smaller technology ones, according to a survey to be released today by accounting firm Ernst & Young.

Colorado firms have secured $469.2 million in venture capital in 2005, compared with $386.8 million raised in all of 2004.

Full Story: http://www.denverpost.com/business/ci_3143365