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         	&nbsp;<font face="verdana, verdana, arial, geneva, helvetica" size=1 color="white"><b>For Jeffrey Dasovich, Enron</b></font>
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  		<b>VENTURE MARKET SUMMARY</b>
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  		<td><BR><div id="market"><font face="verdana, arial, geneva, helvetica" size="2">Coming out of the Labor Day weekend, thirteen companies reported $70.8 million in equity funding and $20 million in debt. Arcot Systems, maker of user authentication products, reported a $20 million Series E round led by new investor Goldman Sachs, while Elata, a software spinout of technology distribution firm Hugh Symons Group, raised a $9.1 million Series A round led by Royal Bank Ventures. <br><br>If the bad news was on holiday, it returned with the work week. Despite raising a whopping $103 million from the likes of Crosspoint and Warburg Pincus, ASP services provider AristaSoft will be shutting down. Onix Microsystems cut 40 people, about 25% of its staff, in response to the lack of a market for its 3D switches. Shakeups can hit VCs too. Commerce One
Ventures, the VC unit of e-commerce services firm Commerce One, has been folded into the company&#39;s corporate development office and Jeff Smith, the vice president and general manager in charge of Commerce One Ventures, has left the company.  <br><br>Seven M&amp;A deals made the news including publicly traded Internet sports firm SportsLine.com&#39;s agreement to acquire Sandbox.com. Microdyne Outsourcing, a subsidiary of public company L-3, has acquired the assets of Envisionet Computer Services, in a $10.7 million deal.<BR><i> - Lizbeth Scordo</i></font></div></td>
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	<font face="verdana, verdana, arial, geneva, helvetica" SIZE=2 color="black"><b>NOTABLE DEALS</b></font><BR><BR>
	<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwQHNNIONLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Despite Raising $103 Million, AristaSoft Shuts Down</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=QHNNIONLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">SAN JOSE, CALIF. -- AristaSoft, which provides ASP services to companies focused on networking and computer devices, is shutting down despite having raised $103 million, including a $68 million third round just over a year ago. A company source confirmed earlier reports that the company, founded in 1999,  was folding. Aristasoft&#39;s plans to wind down were first reported by the San Francisco Chronicle.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=QHNNIONLHI">more..</a>]--><br>
<a href="http://www.aristasoft.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.aristasoft.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwLPKNLQOLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Commerce One Ventures Folded Into Corporate Development Unit</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=LPKNLQOLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">PLEASANTON, CALIF.  -- Commerce One Ventures, the venture capital unit of e-commerce services company Commerce One, has been folded into the company&#39;s corporate development office, VentureWire has learned. Jeff Smith, the vice president and general manager in charge of Commerce One Ventures, has left the company. The company confirmed his departure but did not return calls for further comment.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=LPKNLQOLHI">more..</a>]--><br>
<a href="http://www.commerceone.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.commerceone.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwNOKMHJPLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Network Photonics Closes Calif. Office, Cutting 45 Employees</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=NOKMHJPLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">BOULDER, COLO. -- Network Photonics, an optical networking company developing third generation switching and transport systems, announced it is shutting down its Santa Rosa, Calif. office. Roughly 45 people out of a total of 65 employees in that office have been laid-off, a company spokesperson said.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=NOKMHJPLHI">more..</a>]--><br>
<a href="http://www.networkphotonics.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.networkphotonics.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwLJIKMLLLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Hugh Symons Spin Off Elata Raises $9.1 Million Series A</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=LJIKMLLLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">LONDON -- Elata,  a firm developing billing, customization, and delivery software for wireless data applications, has raised $9.1 million in its Series A round of funding.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=LJIKMLLLHI">more..</a>]--><br>
<a href="http://www.elata.co.uk" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.elata.co.uk</font></a>
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	<font face="verdana, verdana, arial, geneva, helvetica" SIZE=2 color="black"><b>UPCOMING EVENTS</b></font>

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November 7 & 8<BR>New York, NY<BR></font>
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In June, over 750 people attended Enterprise Outlook West in San Francisco and because of that conference's great success we are now bringing it east to New York City. Scores of new companies are jockeying for position in the growing markets for Web services, application integration, collaboration, and other business-critical areas.<a href='http://secure.technologicpartners.com/eoregister.asp'> Register today,</a> save $300.</font>





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    	<a href="http://venturewire.com/index.asp"><font face="verdana, verdana, arial, geneva, helvetica" SIZE=2 color="black"><b>VENTUREWIRE INDEX</b></font></a>
    	<a href="http://venturewire.com/index.asp"><img alt='VentureWire Index' border='0' src="http://208.185.40.7/charts/images/newsAVWIX.jpg"></a><br>
    	<font face="verdana, arial, geneva, helvetica" size="1" color="gray">574.9 &nbsp; -0.36%</font>
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	<TABLE BGCOLOR="#eeeeee"><TR><TD><PRE>Here they come again!-Mike Homer, Steve Kirsch, Frank
Moss-back in the startup trenches. And back at our
conferences.

Mike, Steve, and Frank have pitched their companies at
our previous Outlook conferences, and they're all
returning in new roles at this year's Internet Outlook.
Mike, formerly of Apple, Netscape, and GO, and a board
member at Palm and Tivo, has just launched Kontiki,
which aims to make the Web faster for all of us. Steve,
founder of Infoseek and Frame Technology, is now at the
helm of Propel, the scalable data management software
provider. Frank, who helped steer Tivoli Systems for
six years, has co-founded Bowstreet, which strives to
make it easier to do business online.

And they are only three of 97 carefully selected
entrepreneurs scheduled to present at Internet Outlook
on September 10 & 11 at the San Francisco Airport
Marriott. Register today at:
	<a target= "_new" href="http://venturewire.com/ads/ad.asp?id=1209">&nbsp;http://www.internetoutlook.net</a></PRE></TD></TR></TABLE>
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	<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwLNQLHHNLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Security Firm nCircle Gets $11M in First Institutional Round</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=LNQLHHNLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">EMERYVILLE, CALIF. -- nCircle Network Security, provider of network security risk management software, said it has closed $11.3 million in Series B financing from Alta Partners, BV Capital, Court Square VEntures, Guide Ventures, Industry VEntures, MIllennium Hanson, Tall Oaks Capital, and individuals. The funding is nCircle&#39;s first institutional investment. Funds will be used for sales, product development, and general operations.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=LNQLHHNLHI">more..</a>]--><br>
<a href="http://www.ncircle.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.ncircle.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwINOOIMLLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Amid Middle East Conflict Aelis Photonics Raises $2.3M Seed</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=INOOIMLLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">JERUSALEM -- Israel Seed Partners closed its latest investment of $2.3 million in the seed round of Aelis Photonics, a Netanya, Israel-based developer of optical signal processors for 40-gig networks, despite violence in the region and the continuing upheaval in the telecommunications industry.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=INOOIMLLHI">more..</a>]--><br></td></tr></table><br>
<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwIHPOMLNLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Digital Video Firm Anthropics Secures $8.7M First Round</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=IHPOMLNLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">LONDON -- Quester, a venture capital company focusing on technology and healthcare, said it was the lead investor in a GBP 6 million ($8.7 million) -first round for Anthropics, a developer of digital technology used to transmit live video of human faces over low bandwidths. Anthropics will use the funding to continue development of its technology.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=IHPOMLNLHI">more..</a>]--><br>
<a href="http://www.quester.co.uk" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.quester.co.uk</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwQPNJJNOLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Online Security Firm Arcot Raises $20 Million Series E </font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=QPNJJNOLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">SANTA CLARA, CALIF. -- Arcot Systems, which provides authentication and digital signature products and services, said it has closed $20 million in Series E financing from Accel Partners, First Union Bank, Goldman Sachs, Novell, Onset Ventures, and Oracle. Funds will be used for product development, sales, and marketing.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=QPNJJNOLHI">more..</a>]--><br>
<a href="http://www.arcot.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.arcot.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwINMKQJMLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">XML Security Firm Vordel Raises $10-Million Series B </font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=INMKQJMLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">DUBLIN, IRELAND -- Vordel, a provider of technology for secure exchange of XML communications, said it has approximately $10 million in Series B financing from DrKW, Elderstreet, ICC Venture Capital, Intel 64 Fund, and Powerscourt Nominees. The funds will be used for the development and marketing of the company&#39;s TalkXML product and for expanding operations in the U.S.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=INMKQJMLHI">more..</a>]--><br>
<a href="http://www.vordel.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.vordel.com</font></a>
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<TABLE BGCOLOR="#eeeeee"><TR><TD><PRE>Saving Costs via Optics

With capital scarce and bandwidth aplenty, optical
components manufacturers face tough market conditions.
Now, systems companies are focusing on reducing costs
and helping carriers do more with the capacity they
already have. Happily, a number of optical technology
companies appear well positioned to capitalize on this
trend. At Optical Portfolio, you&#39;ll hear from startups
such as Symmorphix, Telephotonics, Pine Photonics, and
Proximion Fiber Optics, which are using integration,
tunability, and real-time network monitoring to create
more intelligent and efficient optical networks.

VentureWire Optical Portfolio, Boston Marriott Cambridge,
October 24 & 25. Register by September 14 and SAVE $200:<br><A target= "_new" href="http://venturewire.com/ads/ad.asp?id=1210">http://www.opticalportfolio.com</a></PRE></TD></TR></TABLE><br>
<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwIPPLHIOLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">MEMS Firm Onix To Cut 25% of Staff  </font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=IPPLHIOLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">RICHMOND, CALIF. -- Onix Microsystems, a developer and manufacturer of microelectromechanical systems-based (MEMS) optical switching engines for communication networks, said it cut 25% of its staff, or close to 40 people, last week. Onix said the cuts occurred in response to the lack of a market for its 3D switches and as result of general market conditions. The company said it is now focusing on developing and shipping its 2D switches before the end of the year.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=IPPLHIOLHI">more..</a>]--><br>
<a href="http://www.onixmicrosystems.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.onixmicrosystems.com</font></a>
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<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwQNQQJILLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">BeVocal Takes Up New CEO from AT&amp;T and Dell</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=QNQQJILLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">SUNNYVALE, CALIF. -- BeVocal, a provider of carrier-grade voice platforms and applications software, announced the appointment of its new CEO and president David D. Hood. Mr. Hood is replacing BeVocal co-founder Mikael Berner, who has taken the title CTO and executive vice president of products. Mr. Hood was previously a general manager at AT&amp;T, where he was responsible for the AT&amp;T&#39;s WorldNet Internet Access business, and a general manager at Dell Computers.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=QNQQJILLHI">more..</a>]--><br>
<a href="http://www.bevocal.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.bevocal.com</font></a>
</td></tr></table><br>

<table border="0" width="80%" cellspacing=0 cellpadding=0><tr><td><a name="vwQNOKNKOLHI"><b><font face="verdana, arial, geneva, helvetica" size="2">Capital Z Halts Tech Investments, Founder Departs</font></b></a></td><td align="right">&nbsp;&nbsp;<a href="http://alert.venturewire.com/o_mailer.asp?sid=QNOKNKOLHI" target=NEW><img src="http://alert.venturewire.com/images/mail2.gif" border="0" height="10" width="15" alt="mail"></a>&nbsp; </td></tr>
<tr><td colspan=2><font face="verdana, arial, geneva, helvetica" size="2">NEW YORK -- Capital Z Partners founding partner Adam Mizel has resigned from the company, according to Brad Cooper, a partner at the private equity firm. Capital Z will not make additional investments in technology startups, Mr. Cooper said. Since 1990 Capital Z has focused on investment in the financial services industry, but beginning in 1998 the firm invested in tech startups related to financial services. Those investments were made using the Capital Z Financial Services II fund, the remainder of which will be used  for financial services investments.
 </font><!--[<a href="http://professional.venturewire.com/story.asp?sid=QNOKNKOLHI">more..</a>]--><br>
<a href="http://www.capitalz.com" target="_new"><font face="verdana, arial, geneva, helvetica" size="2">http://www.capitalz.com</font></a>
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	<TABLE BGCOLOR="#eeeeee"><TR><TD><PRE>When Corporate and Venture Worlds Collide
VentureWire Breakfast Briefing - San Mateo, CA, Sept. 19

Innovative companies such as Eastman Chemical have led
the charge in using venturing to spur corporate
transformation and create long-term value. Learn how
corporate and private VCs can work together to create
profitable, sustainable investment strategies.  What
are some examples of corporations and VCs working
together to build companies? How can you balance
strategic vs. financial value? How can you prove value
despite sagging returns? Mark Klopp, managing director,
Eastman Ventures, Eastman Chemical Co. shares his
thoughts on aligning investment strategies to drive
innovation and generate returns.
	<A target= "_new" href="http://venturewire.com/ads/ad.asp?id=1211">http://events.venturewire.com/briefingEvent.asp</a></PRE></TD></TR></TABLE>
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