One more, this time on VCs and current valuations:
interactive.wsj.com@2.cgi?mfmuse/text/autowire/data/DI-CO-20001205-000498.djml/&d2hconverter=display-d2h&NVP=&template=atlas-srch-searchrecent-nf.tmpl&form=atlas-srch-searchrecent-nf.html&from-and=AND&to-and=AND&sort=Article-Doc-Date+desc&qand=&bool_query=fiber+optics&dbname=%26name1%3Ddbname%26name2%3Ddbname%26name3%3Ddbname%26period%3D%3A720&location=article&HI=
December 5, 2000
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WSJE: Fiber-Optic Deals Score High In Envy Poll
By CHARLES FLEMING
Fiber optics is the latest hot ticket among European venture capitalists, but some - shaken by the collapse of technology stocks - complain that entrepreneurs in the young sector are ignoring market reality by overpricing their companies.
In the latest round of The Wall Street Journal Europe's quarterly Portfolio Envy Poll, a panel of ten European venture capitalists was asked to name the companies they envy most in their rivals' portfolios. The poll turned up a broad selection of sectors ranging from Internet software and biotechnology to wireless-enabled computer games. But it was broadband telecommunications and especially fiber-optic companies that dominated the field this month, accounting for eight out of the 22 firms named. The top choice was components manufacturer Aifotec Fiberoptics, which was named by two panelists. Others in the same sector include Virtual Photonics in Germany, Kymata in Scotland, Memscap in France, and Optillion in Sweden. . . .
But even though the prices being paid for stakes in such companies are high, this isn't a speculative "dot.com" phenomenon, venture capitalists on the panel note. First, telecommunications firms have already invested in fiber-optic long-distance networks but still require new fiber-optic connections and local fiber-optic networks to replace the traditional copper lines that slow down the whole system. "There's already an industry starting to build optical substations," says Eric Archambeau of Benchmark Capital.
Second, there's a high technical barrier to entry in the sector, because building a network itself is expensive and because building manufacturing facilities for fiber-optic components is technically demanding. "This could be one space where valuations are high but backed by fundamentals," says Mr. Colo of Spectrum Equity.
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