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Cavium Networks IPO Filing: Purple Rain?

February 21, 2007 on 1:46 pm | In Company Analysis, Mergers & Acquisitions, IPO |

Cavium Networks recently filed for IPO status.  What does its investment network look like?  I mapped its Investment Relational Map, included inactive companies in the Company Filter, and Added Capital Information + Number of Total Investors and Investments from the Map Options.  The resultant Map is below.

From the above map, Cavium has 9 investors, who have less than 25 total investments with the exception of Menlo Ventures (152), but 7 of 9 have at least 10 investments.  Thus, Cavium’s investors have relatively small portfolios, but have some experience as investors.  There are no Public companies in the map, but 4 out of 6 of the related companies are acquired (Purple = IronPort, Maranti, Theras, and Passmark Security).  Intrigued at this “Purple Rain,” I next factored in the Board Members and Management Team by clicking on Relational Map, added in Former boards and teams from the Person Filter, and Dropped Pendants.  This map is below.

 

The predominant company (box) color in the above map is Purple: Acquired companies represent 15/35 = 43% of the companies on the map.  Again, there are no public companies on the map.  The people on the map indicate significant past SV board experience John Jarve (Menlo Ventures, #62 on the Midas List); C. N. Reddy (Alliance Ventures); Tony Pantuso (NeoCarta Ventures); and Raman Khanna (Diamondhead Ventures).  But none of these board members have had experience on a SV company that went public.  From a relational capital perspective, it is surprising that Cavium is going public versus seeking acquisition (as a purple trend would indicate).  Maybe the trend for IPOs is real - this may be a sign of more IPO companies in the future because Cavium’s relational capital points toward M & A.  It will be interesting to see what happens at IPO.