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Private Equity Week Wire for Thursday 10/12

? SAN FRANCISCO — Stanford Capital Ventures Corp. today announced CreateLabs, an equity investor, technology builder, US-Asia strategic alliance developer, and incubator of high technology businesses focusing on innovative web based software solutions, broadband, and wireless opportunities in the U.S. and Asia. CreateLabs has a strategic investment in development powerhouse CyberLabs.com, with several offices in Hong Kong and China. CyberLabs provides soup to nuts marketing, technical and operations development, including Internet and intranet development, database creation, instant translation, and Chinese localization. CyberLabs.com has developed several websites in operation including Giftcentre.com.cn and Dxgift.com.cn.

? SAN JOSE, CA — Lantern Communications, the pioneer of 10 Gbps Ethernet optical packet rings, today announced that it has raised $59 million in its second round of financing. This funding will hasten the development of the company’s innovative Resilient Optical Packet Ring (ROPR) system for metropolitan area networks. Additionally, the funding will facilitate the expansion of the company’s operation through its newly formed subsidiary, Lantern Communications Ltd., located in Ottawa, Canada. Led by The Goldman Sachs Group Inc. and its affiliates (NYSE:GS), the round also includes prominent investment partners Madison Dearborn Partners, Menlo Ventures, Integral Capital, Tyco International and existing investor Mohr Davidow Ventures. Included in these investors’ portfolios are a number of next generation service providers who are deploying IP-based infrastructures and can benefit from Lantern’s IP-optimized systems for delivery of application-aware Ethernet services.

? BOCA RATON, FL — Sterling Financial Holdings Inc., the full-service international investment banking and brokerage firm announced today the successful completion of their $5.35 million private placement of equity securities for its new venture capital portal that will offer accredited investors private placements on-line and provide entrepreneurs access to capital markets and the public a web portal that meets a myriad of business planning needs. The shares in the offering were sold mainly offshore to accredited individuals and institutions such as CrossBow Ventures (“CrossBow”), one of the largest institutional participants, investing a little over $1 million. CrossBow Ventures, based in West Palm Beach, is one of the largest and most influential private equity investment firms based in Florida, which manages over $140 million on behalf of institutional and private investors in the United States and Switzerland. Stephen J. Warner, CEO and one of CrossBow’s founders, will join Sterling’s advisory board. “myprivates.com will be an important part in helping companies that have received venture capital move to their next stages in raising capital,” says Warner.

? HERNDON, VA — NETSEC, the managed information security services provider, announced today that it has received a $3.8 million investment from E*TRADE Venture Capital, the venture capital affiliate of E*TRADE Group, Inc. (Nasdaq:EGRP). This capital infusion, combined with a recent $11.2 million investment from Softbank Ventures, closes NETSEC’s first round of funding at $15 million.

? NEW YORK — Jackpot Enterprises Inc. (NYSE:J), which is being renamed J Net Enterprises, Inc. pending shareholder approval, today announced a definitive agreement to invest $20 million in a convertible preferred stock private placement of InterWorld Corp. (NASDAQ:INTW). J Net Enterprises is a technology holding company and a manager of technology investment funds focused on making concentrated investments in leading B2B enterprise software and infrastructure companies. InterWorld Corporation is a leading provider of Mission-Ready(TM) software solutions for sell-side e-commerce for Fortune 2000 corporations. J Net will provide the financing through the purchase of $20 million of 8% Convertible Preferred Stock, along with certain warrants. The Preferred Stock is convertible into InterWorld common stock at a price of $6.25 per share with dividends being paid quarterly in cash or in kind at InterWorld’s option. The conversion price is subject to downward adjustments under certain other circumstances. Pursuant to the terms of the PreferredStock, on April 10, 2001, J Net will have the right to require InterWorld to redeem thePreferred Stock at 150% of the purchase price unless InterWorld enters into a business combination with J Net. InterWorld will use the net proceeds from the financing for general corporate purposes. As a result of the transaction, J Net will designate two persons to InterWorld’s Board of Directors.

? HERNDON, VA — MRL, the market leader in infectious disease information services, surveillance and testing, today announced the successful completion of a private placement, raising $25 million. MRL is a pioneer in the development of international electronic hospital and laboratory networks that focus on antibiotic resistance, and rare and emerging infectious diseases. Sprout Group, the venture capital affiliate of Donaldson, Lufkin & Jenrette (DLJ), led the financing, with the participation of Global Health Care Partners (GHCP) and DLJ’s Merchant Banking Partners III, L.P. and its affiliates (DLJMBP III). In addition, MRL announced today that the Sprout-led team purchased all non-management, equity shares held by Focus Technologies, Inc., the former parent company of MRL.

? CAMBRIDGE, MA — Genomics Collaborative (GCI) today announced the closing of a $36.2 million private placement. The financing was led by INVESCO Private Capital and included equity funding from a select group of investors including; Whitney & Co.; AGTC Funds; Oracle Partners, the Economic Development Board of Singapore (EDB), and several other strategic investors.

? FT LEE, NJ — Kamoon Inc., the infrastructure software company that powers the expert services component of business online, announced today that it has received $23 million for its second round of funding. The investment round, led by Patricof & Co. Ventures and its global network, Apax Partners, with BRM Group, and XDL Intervest Capital, will ensure further development of the complete suite of Kamoon’s Knowledge Commerce Channel software solutions, as well as strategic marketing and business development plans for rapid expansion across the financial services, professional services and B2B marketplaces verticals.

WESTLAKE VILLAGE, CA — Need2Buy, an online marketplacefor the electronic components industry, announced today that it has acquiredUnimate Electronics GmbH, a leading component trading and fulfillmentcompany, based in Munich, Germany. This strategic acquisition providesNeed2Buy with the operations infrastructure, region-specific expertise andextensive customer relationships to further drive the company’s expansion inthe European market.

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