E-Capital Investments Alters Business Model
Byline: Yasmine Chinwala
E-capital Investments, the AIM-listed internet investment firm, has altered its business model from an early-stage technology investor to a traditional private equity business, and launched a new fund alongside Sigma Technology Group, a technology advisory firm.E-capital's tale is typical of the dotcom boom. The firm was launched in November 1999. It changed its name from Cambury Investments and floated on AIM in early 2000. It rapidly built up a portfolio of internet, e-commerce and new technology investments, including Toyzone.co.uk, PrintPotato.com and bizzbuild.com.
But when the bubble burst, the company began to struggle with writedowns and losses on its portfolio companies. For the year ended June 30, 2001, the company had net assets of pound sterling18.8m ([euro]29.4m) including pound sterling15.5m in cash after making a pound sterling16.7m exceptional loss. The loss was made up of a pound sterling9m of portfolio provisions and pound sterling7.7m loss on the disposal of a single investment, Virtual European Office.
In a bid to turn itself around, e-capital and Sigma Technology are now setting up a technology realisation fund. The fund will help investment companies, such as e-capital itself, to divest themselves of non-core technology investment portfolios. …