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To: still learning who wrote (192)	4/16/1999 5:42:00 PM
From: xcr600	Read Replies (1) \| Respond to of 737

From Telecommunications Online "Telecom Startups to Watch" x dgtlmrktplce.com 10 Telecom Start-Ups to Watch Last year, venture capitalists poured more money into telecom-related start-ups than ever before. Which companies are most likely to succeed and become the next industry leaders? Sterling Perrin If you're having trouble keeping track of the number of new communications companies popping up, you're not alone. Start-ups have been emerging at an astounding rate and there's a reason behind it: Last year, venture capitalists poured more money into them than ever. According to Price Waterhouse's annual National Venture Capital Survey, $1.233 billion was invested in telecom companies in 1997; that's $493 million more than the previous year. The only investment category to exceed telecom was the Internet, which doubled its 1996 performance to end the year at $1.88 billion in venture funding. As they say in investment circles, past performance is no indication of future results. But the evidence suggests that the telecom gold rush will not be slowing down any time soon. According to Kirk Walden, the national director of venture capital research at Price Waterhouse in Dallas, Texas, the opportunities and the uncertainties created by telecom reform are driving much of the funding. “I can say with a high degree of confidence that there has to be an incredible opportunity for change to have that kind of [record] increase in investment. ... The business models for a lot of these telecom companies are not well understood. But it is that unknown that creates the opportunity,” he said. Similar new and unknown qualities have attracted venture interest and dollars to Internet start-up companies. With so much money fueling the seemingly unstoppable momentum, we wondered, which are the companies most likely to succeed? Which will become the next market and industry leaders? To get some insights on the situation, we asked the experts--the industry analysts, the funding firms, and the founding entrepreneurs. The results presented here identify some of the more promising emerging companies. Each of the companies profiled has been impacted by either the phenomenal growth of the Internet or the potential opportunities of telecom reform. All 10, listed in alphabetical order, are privately held and venture-backed, and all of them have limited name recognition in the marketplace--today. Eight of the 10 start-ups are less than three years old. All of these companies have something unique to offer in terms of products and technology: Each has the potential to become the next Cisco Systems, but by the same token, each has the potential to whither away. Even veteran entrepreneur Kamran Elahian has one loss on his record. As Kirk Walden quipped, “If you have a model that works, your potential is limitless. If it doesn't work, then you lose. That's why they call it venture capital.” Time and technology will tell; here in alphabetical order are our picks. <snip> Ramp Networks A later-stage Internet and remote access start-up, Ramp Networks of Santa Clara, Calif., continues to amass venture funding and industry accolades for its WebRamp family of products. WebRamp M3t was named Best of Show at last year's NetWorld+Interop. Meanwhile, venture capitalists and corporations--including Berkeley International Capital Corporation, Venrock Associates, Draper International, and Compaq Computer--have given the company $36 million since its founding in 1993. The WebRamp Internet access software and hardware holds appeal for small businesses and telecommuters eager to capitalize on the benefits of the Internet, but who want to do so cheaply and simply--a potential market of more than 75 million customers worldwide. The WebRamp products are distributed in the United States through national distributors, VARs, and ISPs. In February, Ramp Networks signed an agreement with InternetReseller.Net in Beaverton, Ore., which distributes products and services to value-added ISPs throughout the United States and Canada. n Sterling Perrin is a journalist and frequent contributor to Telecommunications magazine.