Barksdale Group to dissolve
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The Barksdale Group, the venture capital fund founded by former Netscape CEO Jim Barksdale, is to close.
8 January 2002 The Barksdale Group, the venture capital fund founded by former Netscape CEO Jim Barksdale, is to close. The decision follows difficulties in raising the finance for a second fund.
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The company was set up in 1999 as the technology boom gathered pace. Its closure is an indication of the intensifying shake-out occurring in the venture capital industry.
Venture capital research company Venture Economics suggests that funds formed in 1999 have performed particularly poorly. Up until the end of September 2001, the average 1999 fund had fallen in value by 3.6%, according to Venture Economics' figures.
The Barksdale Group invested around $120 million (€134.8m) out of $180 million (€202.3m) in 18 companies, with the remainder ear-marked for further investment in portfolio companies. They will need it. Most of them are far from profitability.
Its worst investment was arguably the $20 million (€22.5m) it pumped into HomeGrocer.com, which was acquired by defunct online food retailer Webvan. Webvan went bankrupt just months after the acquisition in the summer of 2001.
The Barksdale Group's four partners - Jim Barksdale, former Netscape executive Peter Currie, former investment bank analyst Danny Rimer and Quincy Smith, also a former Netscape executive - will continue to manage the venture's investments, but will not charge a management fee.
The founders of the fund will not stay idle for long. Barksdale and Currie are set to become special advisors to well-established venture capital company General Atlantic Partners and Rimer is to set up a London office for Swiss venture capital firm Index Ventures.
