Arrives With $20M Round President and Co-Founder Ben du Pont got his first inkling that his online intellectual property marketplace had the potential to succeed last April, when he got a call from the assistant to Durk Jager, then-chief executive of Procter & Gamble Co. As it turns out, Jager wanted to talk up’s virtues at a shareholders meeting.

“Here we were, a 30-person Internet company that couldn’t get our carpets cleaned, and the CEO of one of the largest consumer products companies wanted to tout our relationship with them,” du Pont recalled. At the time, P&G was not only a customer, it was also an investor.

Du Pont again got the feeling that his two-year-old company had finally arrived earlier this month, when it closed on a $20 million Series B deal after an arduous fund-raising process. The Cambridge, Mass.-based company is expected to make a formal announcement about the financing today. had been in the market with the offering since last summer and, despite having 450 of the world’s largest companies on its impressive customer roster, ended up capping the financing at less than it had originally intended as VCs continued to tighten their belts during the second half of last year.

On the upside, more companies than expected signed on to back in the Series B transaction. On the corporate investing side, newcomers Bayer AG and Caterpillar Inc. led the round, and were joined by Series A players Siemens AG, NTT, Procter & Gamble and Honeywell International. Repeat investor 3i Group led the pack on the institutional front, and previous backer Venrock Associates and first-timer Ashford Capital Management also participated. Seed investor Du Pont Co. sat this round out, in part to dilute its ownership stake.

To date, the self-proclaimed neutral, online intellectual property exchange has raised approximately $40 million in venture financing.

No More Pounding The Pavement

When du Pont helped found in 1999, his vision was to take the so-called shoe leather and rolodex process of finding willing buyers for new technologies – especially in the research and development space – and make it more efficient.

“[As much as] 80% to 90% of technologies developed as a result of companies’ R&D spending never make it off the lab bench,” du Pont said. “Most are terrific innovations, but they just don’t apply to where the company is going. So about 10 years ago, companies realized that they needed to license this stuff to each other, which can generate significant revenue. And it’s almost all profit, because the cost already has been sunk [into developing the technology].” was established to introduce buyers and sellers of such innovations and give them the means by which to strike a deal. Now, a little more than a year after its official launch, the site has more than 60 founding sponsors behind it and a customer roster representing approximately 15% of the world’s total research and development spending.

With offices in the U.S., Europe and Asia, has recruited research and development heavyweights from all over the world to participate in its online exchange of ideas and technologies, including 3M, Toshiba Corp., Pitney Bowes, British Telecommunications and Royal Philips Electronics. Additionally, all of its investors are paying customers.

Although its target audience is scientists and engineers, anyone who touches technology can use the exchange, du Pont said. The site offers both basic searches free of charge, or more comprehensive features on a subscription basis that some companies may purchase for upwards of $10,000 a year, he added.

It seems to be worth even more than that to its investors.

“Our investment in versus other means of participation as a subscriber is the strongest statement we can make both externally and internally that Caterpillar’s new business thrust will include making our world-class technology and business processes broadly available,” said Bill Berlinger, corporate licensing manager with Caterpillar. “[To that end], we want to influence the architecture, processes and value-added services of to suit the technology transfer needs of our industries.”

While a few competitors have crowded the intellectual property exchange space since first launched its Web site about 20 by du Pont’s count – most are focused on patent exchanges.

“These don’t really add any value, because patents typically are issued three to four years after a technology is created, and they’re publicly available through the U.S. Patent & Trademark Office,” he said. About a third of the technologies available on are patent-pending, he added.

Robyn Kurdek can be contacted at Story Feedback.