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Non-Tech : Wit Capital - The way of the future? -- Ignore unavailable to you. Want to Upgrade?

To: mod who wrote (471)	3/1/1999 1:47:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 16809

mod:Do you know individuals are allowed to make investments in Wit,like through private placement route or any such avenue? Much obliged in advanced for your input.

To: mod who wrote (471)	3/1/1999 11:08:00 PM
From: mod	Read Replies (1) \| Respond to of 16809

From thestreet.com: Capital Z invests in Wit Capital By Gregg Wirth Staff Reporter 3/1/99 7:19 PM ET Steven Gluckstern is trying to bite the hand that has fed him for so many years. Despite his pedigree as a traditional Wall Street banker in the sedate sector of insurance, Gluckstern sees the future as increasingly Internet-based. In fact, he's betting money on it -- goosing the efforts of online brokerages and new entrepreneurial ventures that are shifting Wall Street's power structure toward the individual investor. As part of that plan, Gluckstern, 47, a former Lehman Brothers (LEH:NYSE) investment banker and part owner of the New York Islanders hockey team, has made a significant investment in online upstart Wit Capital through his private partnership, Capital Z Partners. "Investors seek opportunities when things change," Gluckstern says. Capital Z announced its $25 million investment in Wit Monday. Wit is an online equity underwriter that has participated in more than 50 stock offerings since September 1997. However, Wit is still relegated to a minor role in almost all the offerings in which it participates, especially those of any size. However, the firm continues to surprise Wall Street as it lures big names in its quest to achieve respectability as a viable investment bank and IPO boutique. Last month, for instance, Wit hired analyst Jonathan Cohen away from Merrill Lynch (MER:NYSE) to lead its research effort. A Wit spokeswoman declined to comment beyond the Capital Z news release. Wit says it plans to use the money from Capital Z to beef up its investment banking staff and launch an Internet-based after-hours trading system. Wit's new system will let online investors avoid the spreads of market makers and traditional exchanges by allowing traders to buy and sell shares directly with other investors, even when the markets are closed. It was this forward thinking that led Capital Z to invest in Wit. "By identifying the technology-enabled individual investor as a critical force in the capital formation process, Wit Capital has established itself as the leader in the online investment banking business," Gluckstern says in a statement announcing the investment in Wit. The investment in Wit came out of Capital Z's Capital Z Financial Services Fund II, which focuses on investment opportunities in the financial service sector. One of the purposes of the fund is to funnel capital to start-up boutiques that can compete with traditional Wall Street firms, Gluckstern says. The new fund was recently closed to investors after raising $1.85 billion and has already made seven investments, including the one in Wit, worth about $400 million. Capital Z envisions more opportunities, especially if big Wall Street banks continue to gobble each other up and downsize, says another partner at the firm, requesting anonymity. "Each new owner of a bank brings a different focus and causes a mass shifting of talent and their relationships out the door," the partner says. That will create new niche opportunities for investment if these disenfranchised bankers start their own firms, he adds. With Wall Street stars such as Thomas Weisel and William Hambrecht recently starting their own firms, and others such as Jamie Dimon still on the sidelines, Capital Z may have no shortage of opportunities. Capital Z's first fund, closed to investment in August, was the $1.5 billion Capital Z Investments, a fund of funds that invests in private equity funds and hedge funds. The fund has between 25 and 50 fund investments in its portfolio, although it is too early after its closing to give an assessment of its returns, Gluckstern says. Is he worried about Capital Z's exposure to hedge funds when several high-profile funds, including the mammoth Long Term Capital, imploded last fall? "You have to be cautious about how much you concentrate on hedge funds," he notes, adding that the fund of funds has only $300 million committed to hedge funds. Gluckstern formed Capital Z with eight founding partners. Gluckstern left his previous job, head of Zurich Group's reinsurance operations, last May, taking with him the firm's chief investment officer, Laurence Cheng. Gluckstern remains Zurich's nonexecutive chairman.