Over $200 Million Returned in Eight Months

While much of private equity fared well in 2007, Focus Ventures in particular had a very strong showing in the past year. The Focus portfolio has seen six initial public offerings and two highly successful acquisitions since December 2006, resulting in great returns for our limited partners over this period.

Beginning in December 2006, Isilon Networks launched a successful initial public offering, raising $108 million. This was a 2005 Focus investment with co-investor Sequoia Capital. Upon distribution, Isilon returned greater than five times our investment cost and had an internal rate of return of 122%. Next up, Focus portfolio company Aruba Networks went public in late March of last year. Focus invested in Aruba’s last round in September 2006 along with Matrix Partners, Sequoia Capital and Trinity Ventures. At distribution, Aruba shares were trading at over three times our investment cost. In June, Focus saw the initial public offering of Starent Networks, which raised $126 million for the company. Focus initially invested in Starent in early 2004. A partial distribution late last year resulted in a return of approximately nine times on the realized shares.

In July, Focus saw two additional initial public offerings. ShoreTel, a Focus investment from 1999, completed its initial public offering as did Virtusa, an investment from early 2004. Finally, on the IPO front, Focus saw the initial public offering of Entropic Communications in December 2007. Focus originally invested in Entropic in December 2005. These three investments have not yet been realized.

Lastly, Focus had two highly successful acquisition events close in the past several months. In July, Centrality Communications was acquired by SiRF Technologies for cash and stock totaling $283 million. The Partnerships returned $23.7 million to limited partners on this 2005 investment with a cost basis of $7 million, resulting in an internal rate of return of close to 100%. More recently, Focus portfolio company EqualLogic was acquired by Dell for $1.4 billion in January of this year. This was the largest all-cash M&A exit for a venture-backed technology company, according to Venture Source. Upon distribution, this 2004 investment returned a multiple of over thirteen times and an internal rate of return of 107%.

In total, Focus was able to return over two hundred million dollars to our limited partners in the past year. Focus reports an internal rate of return across our family of funds of close to 100% over the ten year period since our inception. We thank you for supporting our continued success. Gung Hay Fat Choy!

Kevin McQuillan was recently ranked #36 on the 2007 Forbes' Midas List of the top technology deal makers.

Focus Ventures recently was a sponsor of MIT’s Forum on the Future of Energy in China; Jim Boettcher spoke on two different panels at the event, which was held in Shanghai.

Focus Ventures hosted a dinner in October at the Four Seasons in East Palo Alto for its distinguished group of Venture Advisors as well as Advisory Committee members. Featured Speaker was Steve Westly, Former California State Controller and current cleantech investor.

Martin Gedalin joined Focus Ventures as an Associate in July. Martin was most recently a Product Manager at Oracle.

We are sorry to announce that George Bischof is leaving Focus Ventures. George joined Focus shortly after the closing of our second fund in early 2000. We have enjoyed working with George over the years and wish him luck in his new endeavor.

Focus Ventures recently celebrated its 10 year anniversary, we look forward to many successful years to come!