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To: Catcher who wrote (31693)	9/3/2000 3:53:47 PM
From: Jim Willie CB	Respond to of 35685

Ideal Fund seems golden to me but got some wicked pricey stocks in there I refer to costly line: SCMR, CIEN, SDLI, JNPR, GLW, BKHM these stocks are priced imo for fy2002-04 but I love the theme and choices read a bunch on MRVC this weekend at a friend's house some dont like the concept of incubator but I love what is being incubated: Charlotte's Web, Luminent, and Optical for XXX (cant remember) the Optical XXX has last-mile solutions with no required line-of-sight Luminent is already profitable and shipping product Charlotte will bring the world clusters of gigabit routers & switches I personally cannot muster the courage to purchase and participate in stocks with staggering Price/Sales ratios like a few listed JDSUniphase is selling at 60:1 price/sales ratio everyone loves it, while others above are MORE expensive would you purchase a business for $1 million if... it had current annual sales of $16k ??? even though next year it might have sales of $28k ??? reminds me of Snapple ice tea stand arguments back in 1995 different product, differnet leadership positions but same extreme order of magnitude on price thoughts from a adequate analyst, mediocre at best trader / Jim

To: Catcher who wrote (31693)	9/3/2000 7:21:38 PM
From: Mannie	Read Replies (1) \| Respond to of 35685

Here is another opinion on the optics sector you might find interesting.... Optical network bubble may be set to burst Friday, September 1, 2000 By JOHN COOK SEATTLE POST-INTELLIGENCER REPORTER VENTURE CAPITALIST ROB CHAPLINSKY was strolling through the exhibits at the National Fiber Optic Engineers Conference earlier this week when he realized that another investing cycle was about to run its course. As Chaplinsky walked the halls of the Colorado Convention Center in Denver, he passed four or five heavily funded optical networking start-ups, all of which his firm -- Mohr, Davidow Ventures -- refused to fund earlier in the year. Right then, the former semiconductor analyst at Hambrecht & Quist knew that there was too much money flowing into the burgeoning sector. "There is a bubble going on here," Chaplinsky said. "And investors who are putting money into optical companies for the first time who don't understand the physics and the market are going to get burned." Even though Chaplinsky was an early believer in fiber optic networking -- investing in Wall Street darlings such as ONI Systems Corp. and Brocade Communications -- he said companies in the sector are getting overfunded. The money flowing into optical networking start-ups -- which make the components to speed up data flow over telecommunications networks -- is impressive. In the first six months of the year, venture capitalists pumped $1.6 billion into 65 optical networking companies. That's more than double the investments of the first six months of 1999 when 34 companies raised $513 million, according to VentureOne. Overfunding sectors is a common occurrence in venture capital investing, where a flavor-of-the-month mentality typically rules the day. The biotech craze of the 1980s, the Push technology phenomenon of 1996, the consumer e-commerce boom of 1999 and the business-to-business exchange excess of early 2000 are just a few examples. Buoyed by the success of skyrocketing initial public offerings, excitable venture capitalists start tossing millions of dollars at copycat companies. The end result is too much money going into lackluster companies. "There is a lot of private capital chasing optical deals that are research projects," Chaplinsky said. "But you have to make sure the thing can get built." The most recent bubble in fiber optic technology could have some very painful aftershocks. Unlike consumer e-commerce companies that had nominal start-up costs, optical networking firms require millions of dollars just to build a working prototype. In other words, the bets are much bigger in this arena. "It is a lot easier when it only costs $3 million to find out if it is successful rather than $300 million," admits Dan Rosen at Frazier Technology Ventures. Case in point: TeraBeam Networks. The high-profile Seattle company has raised more than half a billion dollars from Lucent, Madrona, Softbank and others. But it has yet to commercially launch its innovative system for transporting data via laser beams over what it calls fiberless optic networks. Same with nLight Photonics, a Seattle component maker that raised $7.2 million this week from Mohr, Davidow. It is not planning to test its product until next year, and commercialization could be even further out. Chaplinsky, who sits on the company's board, said companies like nLight usually spend $50 million to $100 million before they start generating revenues and profits. Yet, the lengthy time to market and high-capital expense are not discouraging some from jumping into the fiber-optic investment game. Meyur Shedh, who, when not running his local jewelry business, dabbles in early stage investments, is looking for the next Sycamore Networks or Nortel. "I don't think it is going to slow down," he said. "Unless someone comes up with something different, optical is the only solution for transporting data."