In 1997, we invested in the internal Lucent incubation of a technology called Perceptual Audio Coding (“PAC”) under the name Lucent Digital Radio (LDR). PAC was a digital compression algorithm developed by Bell Lab technologists that would ultimately be used to convert AM/FM radio broadcasts from analog to digital for improved sound quality and new data services.

Our research indicated that PAC was an effective solution for the radio market, and due diligence showed competitive technologies to be distinctly inferior. Since Lucent’s strategic interests did not include broadcast radio, it was willing to grant an exclusive license for the PAC technology in the radio field. Our team supervised the transfer of the core engineering team and physical assets to a start-up.

We funded the business and lead it through the pre-revenue technology development cycle. In August 1999, LDR completed a Series A financing round of $10.0 million led by Pequot Capital. In August 2000, LDR merged with its principal competitor, USA Digital Radio to form iBiquity. In October 2003, the FCC officially sanctioned iBiquity’s HD Radio™ technology as the US industry standard for digital radio. By January 2005, all ten of the nation’s largest radio station groups -- including Clear Channel Communications and Infinity Broadcasting -- had converted or committed to converting approximately 2,500 radio stations to iBiquity’s HD Radio™ technology. In 2006, the first wave of home and automobile radios hit the consumer market.

In May 1999, our team began working with Rajiv Laroia, a leading researcher in Lucent’s Bell Labs. Laroia had developed a concept for a new wireless data architecture that offered greater performance than existing 3G technologies at five to ten times less cost.

We funded a short development project and worked with Laroia to develop a business plan, presenting the Flarion concept to other venture capitalists. In Februrary 2000, we led Flarion’s Series A fundraising of $12.5 million with Bessemer Venture Partners, Charles River Ventures and Pequot Capital. The investor group recruited former NextWave Telcom Inc. COO Ray Dolan as CEO, and added three industry luminaries as independent board members. Once the venture was launched, we brought it to the attention of Cisco, and in March 2001, a series B financing round was led by Cisco Systems.

Today, Flarion’s Flash-OFDM mobile communications network technology creates seamless mobile Internet access, enabling mobile operators to profitably offer low-cost, IP-based wireless broadband services. In 2005 the compny began its first commercial deployments with customers in Europe and the U.S. In February 2006, Flarion was sold to Qualcomm for $805 million, the fourth largest venture capital backed exit in the last five years.

InPhase Technologies was spun out of Bell Labs research in December 2000 with the objective of becoming the first company to bring holographic data storage technology to market. Through revolutionary techniques developed by a team of Bell Labs scientists, InPhase solved several fundamental problems associated with holographic storage, including the creation of a viable, commercial storage medium.

We identified the spin-out opportunity in Bell Labs in 1997 and supported the venture development/market qualification phase while the nascent venture was still inside Bell Labs. Ultimately, we negotiated and transferred the intellectual property and equipment from Lucent to the new independent company, and orchestrated the initial venture capital syndication. The Series A financing of $14.0 million was led by Signal Lake Venture Fund, Madison Dearborn Partners, Newtown Technology Partners and a strategic investor, Imation. In November 2002, after continued advancements, New Ventures Partners helped InPhase close a $6.3 million Series B financing round, recruiting strategic investor Hitachi Maxell Ltd. ("Maxell"), one of the leading global manufacturers of storage media. Less than two years later, in January 2004, New Ventures Partners led an $8.7 million second tranche of the Series B financing, attracting additional strategic and financial investors.

In January 2005, InPhase announced a breakthrough in data storage with the world's first prototype of a holographic storage drive. The prototype is the foundation for InPhase's family of Tapestry holographic drives, with data capacities that range from 200 GB to 1.6 TB on a single disk.

New Ventures Partners remains InPhase's lead venture capital investor on the board of the directors, and continues to work closely with management on strategy, partnerships and financial planning.

Initially an internal unit held within the BTExact division of British Telecom, Azure was the initial spin-out New Ventures Partners orchestrated under its new exclusive BT relationship in March 2003. New Ventures Partners selected Azure because of its large market opportunity, its strong value proposition and its ability to leverage its history and relationship with BT.

New Ventures Partners launched the independent company by negotiating intellectual property and asset transfer agreements, and played a lead role in recruiting and hiring the senior management team. In addition, New Ventures Partners negotiated multi-million dollar supply agreements with BT operating groups, and transitioned over 100 employees and contractors to the new company. New Ventures Partners participated in the due diligence for six potential acquisitions, three of which were closed. Most recently, New Ventures Partners led Azure’s venture financing with new investors Doughty Hanson and Intel Capital.

Today Azure is the global leader in revenue assurance with over 200 employees, operations throughout Europe, Asia and North America, and counts more than 20 of the top 40 operators as their customers. Its unique solutions enable telecom operators to reduce costs and maximize revenues from existing operations and infrastructure, by improving the accuracy of cross-carrier billing, identifying and diagnosing the source of lost revenues and reducing fraud.

In May, 2006, New Venture Partners took a lead role in negotiating the sale of Azure to Subex Ltd, a leader in fraud detection software. This represents the largest European telecom software exit of the past five years.

Vidus Limited began as a project within British Telecom's R&D unit, and was one of New Ventures Partners' initial spin-out ventures under the firm's exclusive relationship with BT. The software, critical to the operations of BT, was attractive because of its large scale field proven track record, clearly superior and patented technology, and global market potential. In addition, BT entered into multi-million dollar customer and distribution contracts with Vidus which allowed the company to begin life with a significant revenue base and the powerful endorsement of a marquis customer.

New Ventures Partners launched and funded Vidus as an independent company in 2003 after negotiating the transfer of all intellectual property, employees and assets and securing substantial supply and distribution agreements with BT. Post investment, New Ventures Partners recruited a seasoned serial CEO with substantial prior experience primarily as an entrepreneur. New Ventures Partners also played a key role in building out the senior executive team including the CFO, COO, VP Marketing, and VP Sales. New Ventures Partners collaborated with the management team to shape the business plan and led the company's venture fundraising campaign. Meanwhile, Vidus successfully expanded its business with new customers, including Centrica (the United Kingdom gas utility), NTL (the largest United Kingdom cable operator) and Eon (the incumbent German power utility).

New Ventures Partners helped negotiate @Road, Inc.'s acquisition of Vidus which was completed in February 2005. @Road, Inc. (NASDAQ: ARDI) is a leading provider of mobile resource management (MRM) services, and was recently named first on Forbes' list of the 25 fastest growing publicly traded technology companies in North America.