Venture Capital

Savvy counsel at each stage of the venture capital continuum
Manatt’s Venture Capital Group brings a high level of experience to transactional representations. We have advised players on both sides of the table at every stage of the investment process—from seed money and start-up funding through Series A, working capital and mezzanine rounds, and bridge financing prior to going public.

We focus on representing emerging companies in the technology, entertainment and media, and healthcare industries, and we maintain close working relationships with the venture capital funds, investment banks, and strategic corporate and individual investors that finance companies in these sectors.

When your company or investment fund brings Manatt into a deal, you are getting “boutique service” backed by the resources of a leading, full-service national law firm and the strategic perspective that comes only from decades of experience nurturing businesses in your industry. We can help you build stability into your business model by advising you on which rights to keep and which to release in order to attract the start-up and growth capital you need.

Specific Areas of Experience

• Fund formation and representation
• Equity financing using venture, angel and strategic investor capital
• Initial public offerings and secondary public offerings
• Debt financing
• Intellectual property licensing and other commercial agreements
• Joint ventures and strategic partnerships
• Employment and equity compensation matters
• ERISA and tax issues
• Corporate governance
• Mergers and acquisitions Manatt in Action

Manatt In Action

Draper Fisher Jurvetson Growth Fund and Gabriel Venture Partners protect their investment in a groundbreaking cell phone service

Cell phone service tailored to kids? Kajeet Inc.’s breakthrough business model attracted investors Draper Fisher Jurvetson Growth Fund and Gabriel Venture Partners at a time when this start up’s cash was frozen in auction securities in early 2008. Both DFJ and Gabriel, along with a venture lender, chose to fund the company through August 2010, when ABS AG was ordered to reimburse Kajeet more than $80 million in damages to its business. The court order put DFJ’s and Gabriel’s significant preferred investment at risk. Up against a December 31 deadline, the two venture firms turned to Manatt to implement their multitiered capital preservation strategy by negotiating extensive debt restructuring documentation, assisting with the equity component and managing tax issues. By working with Manatt client Silicon Valley Bank to buy out Kajeet’s venture lender, Manatt venture capital attorneys helped DFJ and Gabriel preserve their liquidation preferences and increase their equity.

VantagePoint Venture Partners invests in big ideas and transformative companies
Manatt counseled the venture capital firm, which was the lead investor in an $18 million financing for Liquid Robotics Inc. An innovator in the marine technology market, Liquid Robotics developed state-of-the-art technology to observe the ocean and its climate and resources in detail with its patented Wave Glider unmanned maritime vehicle. The seacraft needs no fuel and uses waves to propel itself for up to a year without recharging its battery, providing a persistent ocean presence for commercial, scientific and defense users. VantagePoint relied on Manatt’s patent, diligence, and corporate experience to wade through the intricacies of intellectual property and venture financing issues. The result was a successful investment in a portfolio company now sought after by academic and government organizations and by players in the petroleum, wind power and fishing sectors.

A wine investor turns to Manatt to uncork a regulatory bottleneck
The business model of My Wines Direct Inc., an online seller offering a tightly edited selection of high-quality, low-cost wines, appealed to New Atlantic Ventures. But directly investing in My Wines would have proven too onerous, since it shipped wines across state lines that would require New Atlantic to file regulatory reports in each jurisdiction. Manatt’s venture capital attorneys were able to address this unique dilemma by assisting New Atlantic in investing in My Wines’ sister entity. Structuring the deal required Manatt to perform due diligence and negotiate key provisions to ensure the security of New Atlantic’s right to the company’s wine inventory and related sales income. The transaction was just one example of how Manatt can break down barriers to close deals that result in win-win solutions.

Arizona Bay Technology invests in Series A preferred stock in ProPlayer Connect
Arizona Bay Technology Ventures, L.P., a San Francisco-based technology capital firm, saw a great opportunity to team up with NFL veteran Jason Kyle, founder of ProPlayer Connect.com, Inc., the only web site that enables businesses and athletes to directly work together. Arizona Bay wanted to utilize their core business of building and funding technology applications to further the goals of the over 150 pro athletes registered on the site, and called in Manatt to quarterback the deal on their behalf. Our attorneys advised Arizona Bay throughout its purchase of Series A preferred stock in ProPlayer Connect. 

Black Diamond Ventures forms a growing green technology investment fund
As a green technology company, NEI Treatment Systems, LLC, had just the kind of bright future that appeals to Black Diamond Ventures. It also had a rather unusual company structure that was a challenge for potential investors. Black Diamond turned to Manatt for counsel. Our venture capital attorneys helped Black Diamond form a single-purpose investment fund, then represented that fund as it raised capital from investors. We structured the deal to take maximum advantage of the peculiarities of the applicable tax and limited liability company laws. We performed the due diligence, negotiated the final terms, and closed the deal. We liked the deal so much, we even invested in the fund ourselves. 

Draper Fisher Jurvetson beats the clock in year-end financing deal with China
Draper Fisher Jurvetson (DFJ) had an unusual but very lucrative opportunity to partner with the government of China’s Changzhou Province in the formation of a Renminbi/yuan-denominated clean-tech investment fund (RMB fund). The catch—the deal had to be put together under an extremely tight deadline due to the close of the 2009 calendar year and the lapsing of administrative approvals. Manatt’s venture capital attorneys helped DFJ establish a structure for the RMB fund, negotiate the terms of the fund with its Chinese partner, retain local counsel to assist in the Chinese language documentation, and steer both parties to a successful closing with time to spare.  

Innovative healthcare provider receives infusion of funding
Qliance Medical Management Inc. offers a revolutionary and affordable option to health insurance and healthcare reform. Operating insurance-free direct primary care clinics in Washington State, it provides low-cost, comprehensive healthcare services that can be bundled with its low-premium insurance plan for serious or catastrophic illnesses requiring outside care. When Qliance wanted to expand its model in Washington and other parts of the country, it turned to three venture capital firms that included Manatt client New Atlantic Ventures. Our lawyers represented New Atlantic in a Series D financing that allowed the company to open clinics in more communities.

 2011 Venture Capital Tombstone 
 2010 Venture Capital Tombstone
 2009 Venture Capital Tombstone