Tuesday, December 1, 1998

Capital fund
seeking investments

Star-Bulletin staff


A Hawaii venture capital fund has between $8 million and $10 million available to help island entrepreneurs get started and wants to finance start-ups in fields where Hawaii has advantages, such as telecommunications and biotech or aquaculture business.

The local venture capital management partnership HMS Hawaii Management Partners said today it will continue to build the fund for the next six months or until it reaches $25 million.

"Hawaii needs more venture capital," said Dick Grey, a veteran Silicon Valley venture capitalist and a partner in HMS Hawaii. "Many of Hawaii's unique characteristics, location and natural resources make this a perfect breeding ground for some companies," he said.

Another partner, Bill Richardson, said the HMS gets about 80 inquiries a year for possible investments and accepts about 10 for review and study. "Out of those, we invest in three to five deals per year. The quality of our deals is very high," Richardson said.

So far, five Hawaii start-ups are operating on initial funding from HMS. They are Neugenesis, a biotech company that grows protein molecules; Kona Bay Oyster & Shrimp Co., an aquaculture business; ALOHA Networks, in telecommunications; Pacific Information Exchange Inc., an Internet service provider; and Digital Island, in telecommunications.

Investors backing the fund include Hawaiian Electric Industries Inc., Pacific Century Financial Corp., Queen's Health Systems and individual investors in Hawaii, California and Singapore.

HMS was started in 1995 with a $2 million investment by a state agency, the Hawaii Strategic Development Corp. HMS Hawaii can be reached at 545-3755.

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