NEW YORK -- Battery Ventures, a venture capital firm specializing in early stage techinvestments, has added a new venture partner to help its portfolio companies raiseadditional funding.

The move, announced Monday, underscores how difficult it is for start-ups to lure newinvestors since the burst of the dot-com bubble, as well as the burden VC firms face iftheir portfolio companies can't secure more funding.

New-hire Stephen Terry, a former investment-banking director at Credit Suisse FirstBoston, will serve as a liaison between the private capital market industry and Battery'sportfolio companies that are seeking additional rounds of funding.

"Even when times were good and there was plenty of money, having Steve would havemade it that much easier for our companies to raise capital," said Ken Lawler, a generalpartner in Battery's San Mateo, Calif., office. "Today, the need is just that much moreacute."

Having a venture partner specifically dedicated to portfolio companies' fund-raisingneeds will free up more time for general partners to focus on their companies' strategicneeds.

Perhaps more importantly, it will offset the need for Battery (www.battery.com) itself toput more of its own capital to keep previous investments afloat. "Occasionally we findourselves having to support companies," said Mr. Lawler.

Battery is by no means the only venture firm making such follow-on investments these

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VENTURES MAIN

Battery Adds Partner to Help ItsPortfolio Firms Raise Cash

Updated Nov. 5, 2001 11:03 a.m. ET

By JANET WHITMAN Dow Jones Newswires

days. The clampdown on venture investing, as well as a lack of viable exit strategies, suchas mergers or IPOs, has prompted a growing list of high-profile VC firms to raise annex,or "bailout," funds to keep their portfolio companies going.

"Cash is no longer the plentiful commodity we once enjoyed," Mr. Terry, who will bebased in Battery's San Mateo office, said in an interview. "The idea is that I will be able toget in very early -- 12 months ahead of the actual fund-raising process -- and work withcompanies to best position them. ... I'll also be working with funding sources to seewhere they got burned and where they're excited to best match them with our portfoliocompanies."

The new position is the latest in a string of hires by Battery over the past couple of yearsin an effort to provide pockets of expertise to allow the general partners to focus onstrategic issues.

Among the firm's other specialty venture partners are two in marketing and one inexecutive recruitment.

Battery has more than 60 portfolio companies. The firm's investments include AkamaiTechnologies Inc., Arbor Networks, Storigen, Looking Glass and others.

So far this year, Battery has invested a total of $28 million in seven technologycompanies.

Four of the firm's portfolio companies have been acquired this year, including LIFFE,which was acquired by Euronext last week for $700 million; RiverDelta, acquired byMotorola Inc. for $300 million; Lara Networks, acquired by Cypress Technologies for$255 million; and Altra Energy, which was acquired by Caminus for $65.5 million.

Write to Janet Whitman at janet.whitman@dowjones.com

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