Former Internet star Herald Chen has left buyout shop Fox Paine & Co. as managing director, according to Buyouts, a related publication to PE Week.
Andy Brimmer, a spokesperson for the Foster City, Calif.-based firm, confirmed that Chen left in October after a nearly four-year stint. “Fox Paine thanked Herald for his service to both the firm and its limited partners, and wishes him well in his future endeavors,” Brimmer said.
Chen, believed to be in his mid-30s, did not return phone messages left on his cell phone or at Fox Paine. Executives at Fox Paine declined to comment further on his departure. Fox Paine lists 20 professionals on the “team” page of its website, including, at the top, its CEO, president and three managing directors. Chen is no longer listed.
Chen joined the firm as a director in December 2002 in what appeared to have been a coup for Fox Paine, which manages more than $2.7 billion and invests in health care, information technology, consumer products and retail, among other industries. Early in his career, Chen was an investment professional at LBO powerhouse Kohlberg Kravis Roberts & Co. In 1999, Chen then co-founded Jamcracker Inc. alongside Exodus Communications founder K.B. “Chandra“ Chandrasekhar. The Santa Clara, Calif.-based company provides products that help software developers supply on-demand services.
Jamcracker had attracted a gusher of venture investments from such backers as Soros Private Equity Partners, Goldman Sachs & Co., and Credit Suisse First Boston. In an October 2000 article on Redherring.com, Chen, then CFO, was reported as saying that the $100 million raised in the company’s latest round of venture financing could last a year-and-a-half, at which time the company might choose to go public. Jamcracker remains a privately held company.
Something of Chen’s career at Fox Paine can be gleaned from press releases issued either by the firm or its portfolio companies. In early 2005, portfolio company ACMI Corp., a maker of medical devices, issued a release identifying Chen as its CEO. Then late last year, Fox Paine announced an agreement to sell the company to London-based medical device company Gyrus Group PLC for $500 million.
Early this year, Fox Paine portfolio company WJ Communications Inc. (Nasdaq: WJCI), a provider of wireless communications equipment, announced the addition of Chen to its board. On the company’s website last week, Chen was still listed as a board member on one page, but his name was omitted on another page. W. Dexter Paine III, president of Fox Paine, is chairman of WJ.
Fox Paine’s website lists 13 portfolio companies, including six that it has exited. Among the active investments are L’Artisan Parfumeur, a 25-year-old maker of perfumes and toiletries, and Erno Laszlo, a maker of skin care products.
The firm has made several hires of late, including Mitchell Pressler as managing director in November. Previously Fox Paine’s lead legal counsel, as a partner at Wachtell, Lipton, Rosen & Katz, Pressler will work out of a newly opened New York office on legal, tax and other issues. He will also tap his network of contacts to try to find investment opportunities. —David Toll