Flybridge Capital Partners
In This Issue
Lessons from Lincoln
Stay in MA
Flybridge Fun
Our Blogs
Portfolio News

Since our inception in 2002, we have invested in 39 companies, including 9 new investments in 2008.  We continue to focus on early stage investment opportunities, typically Series A financings where our hands-on approach can add significant value to young companies.  We emphasize investing in high-quality teams running capital efficient businesses targeting large market opportunities.  Our investment allocation of $5 to $10 million per company with initial investments of sub $1 million seeds to $8 million is consistent with "old fashioned" early stage investing. 

Six of our nine 2008 investments and two of our 2007 investments were announced since our last newsletter.  These include:

Sciformix

In November 2007, we led a $3.3M Series A investment in Sciformix, a outsourcing company whose aim is to deliver high quality, knowledge-based and analytical services to the pharmaceutical industry using a cost-optimized global delivery model.  Chip Hazard joined the Board. 


Abraham Lincoln

In December 2007, we co-led a $5.5M Series A investment in Virtual Computer.  Virtual Computer delivers solutions that capitalize on virtualization technology to reduce the cost of managing corporate PCs while improving their reliability, security, and usability.  Jon Karlen joined the Board. 

www.virtualcomputer.com


Abraham Lincoln

In February 2008, we co-led a $25M Series B investment in PolyRemedy, which has developed a robotic system for the delivery of nano-material based wound dressings at the point-of-care.  Michael Greeley joined the Board. 

www.polyremedy.com


Abraham Lincoln

In May 2008, we led an $8M Series A investment in Sand 9.  The company is designing components that will dramatically increase the capabilities of electronic devices. David Aronoff joined the Board. 

www.sand9.com


Abraham Lincoln

In June 2008, we led an $18.5M Series D investment in Eka Systems, a global manufacturer and supplier of wireless, self-managing, self-healing Smart Network and Smart Grid networking solutions.  Jon Karlen joined the Board. 

www.ekasystems.com


byledge

In July 2008, we co-led a Series A investment in ByLedge, a stealth mode startup building a consumer-oriented information-centric service. The ByLedge team consists of industry vets and pioneers from the database, search, and online worlds, including Michael Stonebraker, who architected INGRES and POSTGRES and founded INGRES, Illustra, StreamBase and Vertica. Chip Hazard joined the Board.

www.byledge.com


Abraham Lincoln

PatientKeeper: In July 2008, we led a $7.5M investment in PatientKeeper, the leading developer of physician information systems.  Chip Hazard led the investment for the firm. 

www.patientkeeper.com


Abraham Lincoln

In August 2008, we led a $5.0 Series A investment in digitalArbor, a providers of onshore/offshore implementation and production services for the digital advertising, marketing, and content markets.  Jeff Bussgang joined the Board. 

www.digitalarbor.com
Newsletter                                                 December 2008
Dear Friends,

This newsletter is an update on our recent activities for our friends and colleagues. It has been a significant year for the firm. In March, we unveiled our new name and announced the close of our third fund which totaled $280 million and has a continued focus on early-stage investments in the consumer, healthcare and information technology sectors. Then in August, we moved into our new home at 500 Boylston Street in Boston's Back Bay. If you have not had a chance to visit us here, please stop by if you are in the neighborhood.

And, as always, we are (still!) actively investing in young companies and outstanding entrepreneurs across the information, consumer and healthcare technology markets. If you have a potential investment that falls into one of these areas, or know any outstanding entrepreneurs who are interested in partnering with hands-on, early-stage investors, please let us know!

We wish you a happy and healthy holiday season and a very prosperous 2009!

David Aronoff, Jeff Bussgang, Michael Greeley, Chip Hazard and Jon Karlen
Lessons from Lincoln
Abraham Lincoln


Each holiday season, we give a non-business book to our portfolio CEOs that we think is thought provoking and relevant to their challenging jobs. Last year, we selected Team of Rivals by Doris Kearns Goodwin, for its focus on the importance that teamwork plays in overcoming difficult situations. As many of you know, the book has recently received great fanfare for its role in President-elect Obama's choices for his cabinet and advisors. Senator Obama even declared that it was the one book he would bring with him to a deserted island!

Abraham Lincoln In the book, Goodwin tells the story of the election of Abraham Lincoln and his unusual decision to select some of his rivals from the presidential campaign to sit on his cabinet. Although these strong-willed rivals were disgruntled about losing the nomination, Lincoln recognized that the country was in a crisis, and in order to preserve the Union and win the Civil War, he must put aside their differences and work together as a team.

While modern day politicians can certainly learn a lot from Lincoln, we feel there is much that entrepreneurs can also learn from one of the most highly respected Presidents in history. Just as the country was in a state of crisis when Lincoln was elected, so too are many businesses and industries today, as they face one of the most challenging economic environments in history. So this year, we thought we would share our own observations on a few of the lessons entrepreneurs can learn from Lincoln:

Surround yourself with people who disagree with you.  Having a variety of opinions is critical to success. Hiring people who will push you outside your comfort zone is often a good thing. Letting people know you are open to listening to all ideas, regardless of whether you agree with them or not, is a differentiator. You do not (and will not) always act on those ideas, but it is critical to create a culture where strong opinions and ideas can be shared freely without fear. Jack Welch was famous for his management sessions in Crotonville, NY where he would push his managers 3 to 4 levels deep in the organization to challenge his thinking and continuously reinvent the business over the years.

Recruit across the aisle. Whether you are looking for new employees, partners or advisors, don't be afraid to look to your competition. Some of the most successful businesses gained competitive advantage by working with their competition. For example, Microsoft and Apple's multi-dimensional, complex relationship throughout their long histories has led to a very successful collaboration, despite their arenas of competition. This cooperation-competition paradigm helped coin a new business jargon phrase, "co-opetition", that many companies successfully pursue.

There are limits to delegation - sometimes you need to seize control yourself.  With no military background President Lincoln delegated many of the military decisions to his generals early on in the war. Unfortunately, things did not proceed as well as he had hoped and in 1863 he began to take control of the war campaign more directly.  He frequently visited the battlefields and pushed his generals to follow his battle plan rather than simply delegating to them and in some cases, made leadership changes to ensure his plan was executed correctly. Lincoln learned that when faced with mission-critical situations, delegating does not always work. Similarly, entrepreneurs often have to take control of certain key business-building functions directly as well.  Many savvy entrepreneurs have learned that at a certain stage of a company's development, they need to play a variety of roles themselves, so that their original vision can be realized.

We hope that Lincoln's lessons are helpful to you as you look ahead towards 2009 and the business challenges it will bring.

Flybridge Launches Stay in MA Program
stayinma
In an effort to foster entrepreneurship and innovation between students and the local business community, Flybridge launched a scholarship program called "Stay in MA" to provide financial assistance to students interested in joining or attending the events of technology and business organizations in the region. Scholarships are available for any currently enrolled undergraduate or graduate student up to $100 per event per student. For more information, please visit www.stayinma.com

Flybridge Fun
VP

Michael "the American Indian Chief" Greeley, Chip "the Biker" Hazard, Jeff "the Construction Worker" Bussgang, David "the Cowboy" Aronoff and Jon "the Cop" Karlen show off the Flybridge "Village People" at our "Catch the Wave" event in Kennebunkport, ME.
 

Abraham Lincoln



The winners at the Flybridge Capital Partners 2nd annual Winter Charity Bowl, team Handi-Racket Tennis, show off their trophy  



Blogs

Looking for insight on how to better work with VCs? Want to know what VCs are thinking about today's market conditions? Or do you just want to know more about our team and what we are interested in? Our blogs are a great place to visit for answers to all!

David Aronoff -- www.geekvc.com
Recent posting: Mood Rings

Jeff Bussgang -- www.seeingbothsides.com
Recent posting: The Government is Here to Help?

Michael Greeley (xconomist) -- www.xconomy.com
Recent posting: Go East, Young Man, Way East


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Interested in Learning More?
Feel free to peruse out website further as well as download a PowerPoint document we've put up that explains our interest areas and approach.

If you are interested in contacting us directly, we are at 500 Boylston Street in Boston and can be reached at 617-307-9292 or fax: 617-307-9293.  Plans can be submitted on our website here.