Novak Biddle goes large, pulls in $227M

Novak Biddle Venture Partners has raised it largest investment vehicle to date as it announced last month that it closed $227 million for its fifth fund. The firm raised $150 million for its previous fund in 2004.

The firm added 12 limited partners to Novak Biddle Venture Partners V, including Carnegie Mellon University, Georgetown University, Kenyon College, Pantheon Ventures, Princeton University and the University of Virginia. Previous investors that re-upped include Notre Dame, Silicon Valley Bank, the University of Richmond and Virginia Tech.

The Washington, D.C.-based firm has had a tough couple of years. Since the beginning of 2005, it has sold just one company, according to Thomson Financial (publisher of VCJ). L-3 Communications Holdings paid an undisclosed amount for SafeView Inc., a Santa Clara, Calif.-based company that sells security scanning devices, in March. SafeView had raised more than $23 million in venture funding from Novak Biddle, Battelle Ventures, Draper Fisher Jurvetson and other investors.

Novak Biddle also recorded only one IPO over the last two years. Roanoke, Va.-based Luna Innovations (Nasdaq: LUNA) went public in June when it offered at $6 per share, down from its intitial range from its filing of $11 to $13. The stock of the fiber optic component maker was trading at about $4 a share in early November, leaving the company’s market capitalization at less than $40 million, not even double the $21.5 million it had raised from Novak Biddle, Dawntreader Ventures, Ernest Ventures and other investors.

Novak Biddle’s last big hits came in 2004 when it took Internet teaching company Blackboard (Nasdaq: BBBB) public in a $77 million IPO, though it raised more than $100 million from Novak Biddle, The Carlyle Group and other early and late stage investors. Matrics, which had raised about $34 million in venture funding, was sold to Symbol Technologies (NYSE: SBL) for $230 million in late 2004.

Novak Biddle, based in Bethesda, Md., has invested in 10 companies this year, including security software startup Revive Systems, which raised a $1.8 million Series A round; Internet music site eMinor, which raised a $2 million Series A round; and surveillance software company ObjectVideo, which raised an $8 million Series E round.

In closing its fund, Novak Biddle has also promoted four professionals to general partner: Philip Bronner, Andrea Kaufman, Tom Scholl and Joy Binford. The firm also hired Janet Yang as a principal. She previously worked with a China-based IT company and San Francisco-based VC firm Draper Richards.