VentureBeat

It’s no secret that there are plenty of cowboy outfits in the venture capital world, including scores that were started before the tech bust. But in the weightier circles of late-stage venture investment, there’s supposed to be less risk, and therefore fewer seat-of-the-pants operations. Which makes Advanced Equities, a Chicago firm fingered by Forbes in a recent expose, all the more notable.

AE is run by a pair of former stock brokers, Keith Daubenspeck and Dwight Badger, who built it in 1999 to invest in tech. But unlike the flawless pedigrees of many VCs, Forbes notes that the two are, respectively, a community college grad and a college dropout. (Perhaps telling of certain prejudices in the financial community, Forbes also chose the title “Garbage In…” for the piece.)

Here’s the outline of AE’s business plan, according to Forbes: First, find a high-profile venture capital outfit like Kleiner Perkins, Khosla Ventures or New Enterprise Associates to work with. Convince clients to give you money, based on the respectability of those firms. Then pour the money into hugely overvalued deals with later-stage firms in the portfolios of said VCs, afterward skimming hefty fees until the firms go public or, far more likely, collapse.

Valuations aside, it’s true that AE is an investor in plenty of high-profile names. In telecom, for instance, it has put money into Infinera and Turin Networks, both still operative. Somewhat less appetizing is the money it put into RFID company Alien Technology, which tried and failed to go public, and Agami, which folded recently, after taking $45 million only six months ago.

A possibly worse indictment against AE’s financial acumen is the money it poured into the early biofuels market, including Altra Biofuels, which raised $120 million in 2006, and Cilion, which got $200 million in what was at one point the biggest cleantech investment ever. Both were first generation ethanol companies at a time when that fuel was highly hyped, but most public companies in the same category have since lost half their value or more; one can only wonder if heavily funded private companies are doing much better.

But what Forbes is suggesting is not that Advanced Equities is simply a badly run firm. The tacit accusation is that AE is run by con-men who scam little old ladies and other clueless investors — in one example, a story is related of how 83 year old Constance Kamberos was toted out of AE’s building by security after trying to complain about her investment in the firm, while multiple other dissatisfied clients have filed suit.

Could it be that some of the most famous firms on Sand Hill, seeking to prop up previous investments, have made themselves complicit in Advanced Equities’ sketchy investing style to pump cash into risky firms like Agami? Perish the thought.

AOL execs add oddly, allege examiners — Eight AOL executives are facing fraud charges at the conclusion of a six-year long investigation by the Securities and Exchange Commission into alleged revenue overstatement of $1 billion during the company’s merger with Time Warner. Four of the men have already settled. Given the company’s historic performance, it’s surprising the remaining four haven’t gotten away with pleading incompetence. More at the WSJ.

MetroFi municipal WiFi throws in the towel — It’s the end of the road for MetroFi, one of several startups that envisioned free municipal WiFi around the nation. The company is looking for a buyer in the nine cities in which it still operates networks. The company had raised some $15 million from August Capital, Sevin Rosen Funds, Western Technology and individual investors.

Mobile fingerprint companies point fingers at each other — Following a suit brought by AuthenTec (NASDAQ: AUTH) alleging patent infringement, Atrua Technologies has turned around and counter-sued, with one exec telling VentureWire, “Some information came to light that it was a frivolous suit, intended to harm our business.” Mobile authentication is a rapidly growing business, which has led to plenty of in-fighting in the courts; just last month, AuthenTec won a judgement against Atmel, a third company in the space that had sued it. We also recently reported a $4 million funding for Atrua.

Bay Area tech immigrants headed home as conditions improve — Bay Area Vietnamese American immigrants are returning to that country in growing numbers as the standard of living rises, as described in a pair of San Jose Merc articles here and here. As one happily remarks on suddenly being able to afford maid service six days a week, “You’ve got to have your first IPO in the U.S. before you get that.” Though Vietnam is a relatively small source of immigrants, if the same happens down the road with Chinese and Indian transplants, the Bay Area may find its talent pool significantly drained.

Advanced Equities set to pour $5B each year into late-stage venture — Advanced Equities Financial has opened an online market for large-stage venture investors, according to VentureWire. The firm brings together groups of investors on a deal-by-deal basis to put money into companies already backed by high-profile, early-stage venture outfits. It says it’s gearing up to put $5 billion yearly into the category.

DuPont and Schott wade into the thin-film game — The thin-film solar cell game is already crowded with multiple well-funded startups, and still only accounts for a miniscule portion of the solar cells actually sold each year. That isn’t preventing industry giants DuPont and Schott Solar from wading in. DuPont will have an R&D facility in Hong Kong and thin-film silicon plant in Shenzhen, China, while Schott is splitting off a separate production facility and business arm in Jena and Putzbrunn, Germany.

Thin-film solar startup Solyndra says goodbye to several founders — Three high-level members of the original technical team of thin-film CIGS startup Solyndra have headed to greener pastures, according to Green Light. The departures may indicate that Solyndra, like other CIGS manufacturers, has run into some developmental difficulties.

Trulia launches real estate ad network — Real estate startup Trulia, which we reported last month is booming amid the housing bust, has launched the Trulia Ad Network to sell targeted ads across sites including Oodle, Homes & Land and The Savvy Source. The press release is here.

A stealthy Georgia-based startup with plans to manufacture silicon-based solar cells unveiled itself this morning, announcing a hefty $50 million financing that will help it start production.

The company, called Suniva, says its cells operate at about 18 percent efficiency, near 50 percent better than the average cell produced today. CEO John Baumstark told us that there is a “clear roadmap” to boosting their efficiency over 20 percent within a year or two. Just as importantly, they are designed to be cheap.

The company is a spin-off of Georgia Tech’s Center for Excellence in Photovoltaics, a research group founded in 1992 by the university. The company is a little more than a year old, and has technology licensed from the Center and has its director, Dr. Ajeet Rohatgi, as its chief technical officer.

Using established manufacturing techniques including screen printing, Suniva expects to be producing cells for under $1 per watt within two to three years. If true, that would make Suniva’s cells some of the most cost-effective photovoltaics available.

The new funding is planned to go towards a 25 megawatt per year production facility located near Atlanta, Georgia, the company’s homebase. Baumstark said in an interview that the production line would be highly automated, requiring a total of about 40 staff members for round-the-clock production.

If it meets its initial cost targets, this first factory can be scaled up to higher production, although the company is also considering opening facilities in other states depending on the incentives offered. However, plans have yet to be finalized even for the first factory.

The funding is Suniva’s second, and was co-led by New Enterprise Associates and Advanced Equities. Goldman Sachs participated though Cogentrix Energy, alongside HIG Ventures and Quercus Investments. The company previously took $5.5 million in mid-2007 from NEA, HIG and Quercus.

Agami, a Silicon Valley storage company with high-profile venture backing, is doing what any self-respecting company in the sector should do these days: Raise a large amount of money before the opportunity melts away.

The company confirmed to VentureBeat that it is negotiating to raise up another round of venture capital, with regulatory filings suggesting it could as much as $50 million. The company hasn’t completed the round yet. The company competes against an array of other storage companies, including some that have gone public recently, such as 3Par (coverage). Like 3Par, Agami offers products that are compatible with virtualization, which is hot within companies right now. Many of the public storage companies, such as 3Par, are losing money.

It’s a great time to raise money or go public because investors — VCs and institutional - are still feeling flush with cash. We’re in a time when lots of money is sloshing around; all that could change quickly if oil prices and the real estate credit crunch continue to take their toll on the economy.

The company has been secretive about its previous backing. It has already raised $64 million since 2003. This round will be its third. Previous backers of Agami, according to regulatory filings, include Kleiner Perkins, along with Advanced Equities, DAG Ventures, Apex Venture Partners, Alta Partners and New Enterprise Associates.