More Alternative Funding

6:00 PM -- Some folk weren't cooking on Thanksgiving -- not in the kitchen, anyway. A team of financiers at Investcorp Technology Ventures (ITV) used the weekend to finalize a $300 million fund earmarked for "Venture Buyouts, Corporate Spinouts and Expansion-Stage Financing in [the] Technology Sector."

This is the kind of money that could help shape the future of IT software, including storage software. It's the kind of money put up by a couple of similar firms, including Kohlberg Kravis Roberts & Co. and Silver Lake Partners, which helped take private the chip portion of Agilent, as well as Sungard.

It's also the kind of money rumormongers have described as a possible hope for Brocade Communications Systems Inc. (Nasdaq: BRCD). (See Is Brocade Going Private?.)

This is actually ITV's second big fund: ITV Fund I emerged in 2001 at $210 million. Its investments included Softek Storage Solutions Inc., which spun off from Fujitsu to talk of its own IPO. (See Window of Opportunity and Softek Taken in Management Buyout.) Even though that hasn't happened yet, Softek appears to have held up just fine.

ITV's Fund II is earmarked for four areas of the tech landscape: "Mobile Data Technologies and Applications; Enterprise Software; Communications Infrastructure Products and Applications; and Digital Content Enablement." There's lots of room in there for storage companies in the U.S. and Western Europe that don't fit the traditional model of startup. Here's how the team describes its chosen investments:

This is good news. Indeed, it's downright heartening to see investors with a more realistic appraisal of the possibilities of the technology sector. Let's hope at least some of that $300 million makes it into storage software or equipment.

Mary Jander, Site Editor, Byte and Switch