Doll II, Side Wrap on $150 Million –

MENLO PARK, Calif. – Doll Capital Management in late September wrapped its second fund, Doll Technology Investment Fund II, along with an affiliate and two parallel funds, which altogether total $150 million.

Launched in late 1998, Fund II was targeted at $80 million to $100 million (VCJ, February, p. 25), and it held a $42 million first close in June (VCJ, July, page 24), followed by a $120 million second close in August.

The $150 million includes an $8 million affiliate fund and two parallel funds worth a total of $14 million, said Managing General Partner Dixon Doll. One parallel fund was created for a Japanese networking-equipment manufacturer and the other for strategic corporate investors

Fund II will back Internet and communications companies, focusing primarily on early-stage enterprises mainly on the West Coast. Doll said the vehicle will invest about $7 million to $8 million per company over time, backing about 19 or 20 businesses. By press time, the new vehicle had notched seven deals and was close to adding an eighth.

The vehicle will be managed by three partners: Pete Moran, who was promoted from being a venture partner, David Chao and Doll. The firm is in the market for two additional investment professionals, a partner or a senior associate on the partner track, and a junior associate who would have an opportunity to get on the partner track.

New limited partners for Doll II include several Singapore government groups that together invested $25 million in the fund; INVESCO Private Capital, Mesirow Partnership Fund I and Fleet Capital. Returning investors include MASCO Capital Corp., St. Paul Venture Capital, 3Com Corp., JAFCO America Ventures and Nippon Investment & Finance Co. Ltd.

The fund features an 80%/20% carried interest split and a 2.5% management fee that declines one-quarter point per annum in years seven through 10.

Doll Technology Investment Fund I wrapped on $46.3 million in September 1997. Doll said the fund’s return is in the six times range, dividing the value of the total portfolio by the committed capital. Two of Fund I’s portfolio companies, Foundry Networks, a gigabit ethernet-space company, and InterNap Network Services, an operator of private network access point facilities, went public in late September and, a college and career information Web site, was slated to file for an offering at press time, Doll said.

Foundry posted the biggest first-day percentage gain this year to date, Doll said, opening at $25 and closing at $156.25.