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Netpreneur News

Volume 8, Number 9, March 6, 2003

This Week's Contents:

1.1 From Closing Your First Sale . . .
    1.2 . . . To Opening Your Sales Channels
    2.1 Maryland Firms Get Tech Transfer Help
    2.2 NTELOS Files Chapter 11
    2.3 Round-up: Quick Hits from Targetware, Managed Objects, GiveMePower,

    .........FedLeads, iPlicity, and TREEV
    3.1 Dough Raise Me
    ......$34M for 3 entrepreneurs
    3.2 Life In The Food Chain
    ......ManTech Acquires MSM
    ......Cogent Acquires Fiber Network Solutions
    ......Essex Acquires Sensys Development Labs
    3.3 Who's Still Buying Tech Companies?
    4.1 Website Helps Women Small Business Owners
5) WHO'SWARE about people at PIR, Dimensions International,

    ..........SkyBitz, Nextel, Xybernaut, and ObjectVideo

|||||||||||||||||||| 1. News About The Program ||||||||||||||||||

Last month's Coffee & DoughNets focused on building a professional sales organization; this month we do the prequel with "Early Stage Sales: Personal Stories From Both Sides Of The Deal." Three pairs of corporate buyers and entrepreneurial sellers who successfully closed deals while still in a relatively early-stage startup mode will take us inside these deals from both sides of the table, including how the entrepreneurs approached their prospects and what made their offerings attractive to their corporate buyers. If you've ever wondered how to effectively sell your startup's products or services to a large corporation or government contractor, you won't want to miss this unique opportunity to talk with three successful entrepreneurs and their customers. We'll cover a range of topics, from the sales process and cycle, to making the pitch, uncovering and understanding the needs, finding and working with the decision maker(s), negotiating, and, of course, closing. C&D will be Tuesday, March 25, at the Cineplex Odeon Tysons Fairfax Square in Vienna, VA, hosted by the Northern Virginia Technology Council (NVTC). Register now.

Register for C&D:

The transcript and video of last week's C&D, "Building A Sales Organization: War Stories From The Startup Frontlines," are now available at the Netpreneur website. From hiring your first sales reps to compensating them, get tips, analysis, and advice from veteran executives Gina Dubbe of Walker Ventures, Carolyn Hyde of SER Solutions, Walt Rogers of Akamai, and Bob Skinner of Icode.

Event Archive:

|||||||||||||||||| 2. Regional Netpreneurs ||||||||||||||||||

(Columbia, MD) It's been an active few weeks for The Maryland Technology Development Corporation (TEDCO). It made three awards this week, including two from its Maryland Technology Transfer Fund (MTTF). Crofton-based System Excelerator received $50,000 to further develop technology from the US Navy that monitors the operational performance of Navy systems. Columbia-based Sphere Corporation received $49,691 to assist in the transfer of technology from the Johns Hopkins University Applied Physics Laboratory for its XML Security Platform, which provides the ability to analyze business information, manage business processes, monitor document workflow, and control personalized user access in real time. Ten companies have received awards under the MTTF program totaling close to $500,000 to fuel technology transfer initiatives, with an additional five companies currently approved and waiting to close on the agreement. Applications for the MTTF fund are accepted continually and reviewed monthly. Additionally, TEDCO awarded Dr. Joseph Kao, a researcher at the University of Maryland Biotechnology Institute's Medical Biotechnology Center, $50,000 through its University Technology Development Fund (UTDF) program to support research for medical applications of recombinant DNA.

(Waynesboro, VA) NTELOS, an integrated communications provider offering wireless digital PCS, dial-up Internet access, DSL, and local and long distance telephone services, filed voluntary petitions for reorganization under Chapter 11. The company has received a commitment for $35 million in debtor-in-possession (DIP) financing from Wachovia Bank. NTELOS said that the filing will not affect the company's operations and that it plans to conduct business as usual throughout the Chapter 11 process.


(Linthicum, MD) Targetware released Version 2.5 of its combination email marketing and CRM solution. New editing features make it easier to design email messages.

(McLean, VA) Managed Objects released Version 3.1 of Formula, its Business Service Management software. Enhancements include the ability to indicate the service impact of a specific technology issue and pinpoint what caused a service to degrade.

(Towson, MD) GiveMePower Corporation released Version 5.2 of its PowerCAD Classic computer-aided design software. The product enables designers, engineers, architects, and others to create professional quality designs and digital blueprints at a lower cost than other solutions.

(McLean, VA) FedLeads released its new Homeland Security Directory for small businesses selling in the federal government. It is a focused version of the company's civilian and defense directories covering the small business procurement officers specifically tasked with handling homeland security for their agencies.

(Reston VA) iPlicity's Kashmere Web Management Suite became the first content management software certified for enterprise use by open source software company Red Hat.

(Herndon, VA) Last week Ceyoniq emerged from financial reorganization, this week the company returns to its original name of TREEV, the name it used before it was acquired by Ceyoniq AG.

|||||||||||||||||| 3. Funding & Finance News ||||||||||||||||||


$3 million in a Series A round for Glenwood, MD-based Platform Logic, a provider of host intrusion prevention software. The round was led by Walker Ventures, with participation by the Maryland Department of Business & Economic Development and unnamed individuals. Platform Logic's flagship product suite, AppFire, monitors program behavior on a server or workstation, identifies inappropriate activity as it is attempted, and prevents damage.

$14 million in a Series B round for Rockville-based sentitO Networks, a provider of converged switching solutions. The round was led by Core Capital and TELUS, with participation by current investors Kodiak Venture Partners, Mid-Atlantic Venture Funds, Inflection Point Ventures, and Technology Venture Partners. sentitO's solutions allow telecom carriers to offer a range of next-generation services, such as integrated voice, data and video, without abandoning their existing infrastructure. Its New End Office product provides access, switching, and service creation to carriers in a single platform, reducing their capital and operational costs. Core Capital's Mark Levine joins sentitO's board.

$17 million for Covega, a new optoelectronic components company formed through the merger of Jessup, MD-based Quantum Photonics and Columbia, MD-based Codeon. The money comes from Core Capital Partners, Boulder Ventures, EDB Ventures, InterSouth Partners, Kinetic Ventures, New Enterprise Associates, OCG Ventures, and Siemens Venture Capital. The merged companies offered complementary optical solutions, with Quantum bringing amplification and monolithic integration technologies and Codeon bringing modulation and high-speed electronic integration technology. As one company, they will provide higher-value modules and sub-systems for the telecommunications, data communications, military, and cable television markets.


-- ManTech Acquires MSM
(Fairfax, VA) Another in a series of recent acquisitions for ManTech International, an IT and technical services solutions provider to the Department of Defense and intelligence community. The company has signed a definitive agreement to acquire Greenbelt, MD-based MSM Security Services, a provider of Personnel Security Investigation services to the US government. MSM has conducted over 250,000 background investigations since its founding in 1978 and maintains a nationwide network of approximately 1,800 contract investigators. ManTech and MSM recently teamed to establish the Investigative Services Joint Venture (ISJV), which was awarded a $50 million contract from the Naval Air Systems Command. ManTech will pay approximately $5.25 million in cash for MSM, which will operate as ManTech MSM Security Services, Inc. under ManTech's Information Technology Solutions Group.

-- Cogent Acquires Fiber Network Solutions
(Washington, DC) Cogent Communications Group, an optical Internet Service Provider, has acquired the Internet service business of Columbus, OH-based Fiber Network Solutions, an Internet access and colocation service provider serving businesses in Ohio, Michigan, and Pennsylvania. As part of the deal, Cogent also acquired five colocation facilities. Cogent is now offering service in over 30 metropolitan markets.

-- Essex Acquires Sensys Development Labs
(Columbia, MD) Essex Corporation, a developer of signal processing algorithms and optical solutions for defense and intelligence applications, has acquired Annapolis Junction, MD-based Sensys Development Laboratories, a provider of systems and software engineering services to the intelligence community. SDL's 28 people will add approximately $4 million to 2003 Essex revenues, projected to exceed $14 million post-acquisition.

(Washington, DC) The number and value of technology transactions continued to decline during 2002, and there were only 17 tech IPOs. According to consulting firm Bond & Pecaro (B&P), the sluggish economic climate, terrorism threat, and possible war were the primary culprits. B&P released its fifth annual study of technology company values, "CyberValuation 2003," which investigates tech company mergers, acquisitions, and IPO activity in 2002 to identify trends in technology company valuations. It provides analysis and commentary on technology-related business transactions, providing valuation multiples and detailed summaries for deals in the ISP/Portal, B2C, B2B, Infrastructure, and Telecom sectors. B&P principal Jeff Anderson notes that, "Valuation multiples did not change markedly compared to 2001, yet it is still uncertain whether values in the technology sector have stabilized. Many companies have effectively reduced their cost structures, yet the lack of demand for technology products and services has hindered profit growth."

|||||||||||||||||| 4. Opportunities & Resources ||||||||||||||||||

(Washington, DC) The US Small Business Administration and Department of Labor launched a new website to help women small business owners and identify federal government resources for women. The site is an outgrowth of Women Entrepreneurship in the 21st Century, a series of summits to discuss the increasing role of women in the American economy and the concerns about roadblocks to growth, long-term viability, and financial health. Features of the website include information about access to capital, healthcare for small businesses, government procurement and contracting opportunities, retirement security, and technology. The next Women Entrepreneurship in the 21st Century conference will take place April 3 at the Pennsylvania Conference Center in Philadelphia. There are 9.1 million women-owned businesses in the country accounting for 38% of all businesses, employing 217.5 million workers, and generating $3.6 billion in revenues.

|||||||||||||||||| 5. Who'sWare ||||||||||||||||||

(Reston, VA) The Public Interest Registry (PIR), the organization created to manage the .org domain registry by the Internet Society, named Edward Viltz as President and CEO. He was previously co-founder and President of Enterprise Integration Corporation.

(Alexandria, VA) IT solutions provider Dimensions International promoted Russell Wright from EVP to Chairman and CEO. He is the son of founder and current Chairman and CEO Dr. Robert Wright, who is stepping down from its day-to-day operations. The elder Wright will stay on in an active business development role and remain as Chairman of Dimensions International's spin-off company, Flight Explorer.

(Dulles, VA) SkyBitz, a provider of satellite-based tracking services, named Andrew Wood as CEO. He was formerly CEO of Shutterfly.

New board members: At Reston-based Nextel Communications, Stephanie Shern, former Vice Chairman and Partner of Ernst & Young; at Fairfax-based Xybernaut, Marc Ginsberg, former US Ambassador to Morocco; and at Reston-based ObjectVideo, Tom Hewitt, founder of Federal Sources, Inc., who was also named Chairman of ObjectVideo's Federal Advisory Board.

Thanks for your interest in and support of the Morino Institute's
Netpreneur News is copyright 2002, Morino Institute, all rights reserved. The information contained here has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. It is provided "as is" and your use is at your own risk.

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