ChimeraCore receives $10 million in funding
Mar 31, 2008

Pacific Coast Business Times

Nearly $29 million poured into three tri-county firms in the fourth quarter of last year, according to a recently published report.

Venture capital firms pumped $10 million into Santa Barbara-based ChimeraCore and $12.6 million into Goleta-based Inogen late last year, according to recently released data from PricewaterhouseCoopers and the National Venture Capital Association.

As previously reported in the Business Times, San Luis Obispo-based Shopatron raised $6 million in the fourth quarter. Inogen and ChimeraCore did not publicly announce their funding rounds.

Founded in 2004, ChimeraCore develops nano-scale drug delivery systems. The company has invented a
“nanocage” that can encapsulate a small-molecule drug, a DNA strand or other remedy.

The surface of the cage has special features to track down specific types of cells, such as cancer cells or a certain type of tissue. The cage convinces receptors on the target cell to absorb the cage into the cell. Once inside, the nanocage dissolves, delivering the treatment.

ChimeraCore closed two, back-to-back funding rounds in late December, totaling about $10 million. The first round included the Santa Barbara arm of DFJ Frontier, Santa Barbara-based Gideon Hixon Fund and New York-based New Science Ventures. Palo Alto-based Prospect Venture Partners joined in a second round.

“The money is going to be used for launching the company into its next phase, which is really being a product- driven company,” Miguel de los Rios, founder and chief executive of ChimeraCore, said in an interview with the Business Times. “One of the things we’ll be doing with this money is building out facilities and being able to work on parallel development lines.”

“This is a long-term investment to continue [de los Rios’] existing research and give him the resources that he needs,” said Frank Foster, a managing director at DFJ Frontier, which was also a seed investor in ChimeraCore. “We worked with [de los Rios] through the concept and testing stages, and now he has the funding to go into serious R&D.”

The late December funding rounds came on the heels of a third-quarter financing in which ChimeraCore raised about $1.5 million, according to PricewaterhouseCoopers records.
Investors in that sequence included Pasadena-based Arcturus Capital, New Science Ventures and DFJ Frontier.

Inogen develops, makes and markets an oxygen concentrator. In the past, oxygen-dependent patients, such as those with chronic obstructive pulmonary disease, remained tethered to heavy, bulky tanks.

Inogen’s device, which is lighter and smaller than most oxygen tanks, produces 90-percent-pure oxygen from air by using electricity to filter out nitrogen and other gases.

Inogen’s system, which can be run from an electrical outlet or on a battery, made headlines in 2006 after it was approved for use on airplanes. Because pure oxygen is extremely flammable, tanks of the gas are banned on flights.

In the fourth quarter of last year, investors threw $12.6 million into Inogen’s pot in a sixth sequence of financing, according to the PricewaterhouseCoopers report.

Investors included: Duluth, Ga.-based Accuitive Medical Ventures; Ann Arbor, Mich.-based Arboretum Ventures; San Diego-based Avalon Ventures; Denmark-based Novo A/S and Menlo Park-based Versant Ventures.

Ingoen did not respond to requests from the Business Times to elaborate on the financing round or to confirm the information provided by PricewaterhouseCoopers.

Earlier in 2007, Inogen announced publicly that it had raked in $22 million in funding from a group of investors led by Novo A/S. At the time, the company said the funds would go toward new manufacturing capabilities and the company’s expansion into international markets.

Shopatron, which was known as FirePoppy until 2006, raised $6 million in October 2007.

San Francisco-based private equity firm Kern Whelan Capital led the round with nearly 10 other investors contributing.

Shopatron has built an online system aimed at brandname manufacturers who want to sell products on their Web sites without detracting from their dealers’ and retailers’ business.

A consumer places an order on the manufacturer’s Web site, and the request is then forwarded to the retailer or dealer nearest the consumer. The local retailer fills the order by either shipping the product or holding it for customer pick-up.