James Joaquin and Matthew Cowan first met in 1999, when Joaquin was with When.com and Cowan was looking to invest on behalf of Bowman Capital. The deal fell apart when Joaquin and his team opted for an acquisition offer from AOL, but the two again crossed paths last year when Joaquin was CEO of Xoom Inc. and Cowan was in his new role as managing partner of Bridgescale Partners. But again no deal, because Xoom was a bit too early in its revenue stage for a later-stage shop like Bridgescale.
Rather than hoping the third time is a charm, Joaquin has switched sides of the table – as a fulltime venture partner with Bridgescale. He began earlier this month, with a public announcement scheduled for next week. Bridgescale also will reveal that it has closed its inaugural fund with $160 million in capital commitments.
“I think it took Matthew a while to forgive me for turning down that term sheet while I was with When,” jokes Joaquin from Bridgescale’s digs in Menlo Park.
“Yeah,” Bowman replies. “Eight years.”
But now they are one happy family, along with fellow managing partner Rob Chaplinsky (previously with Mohr Davidow Ventures), principal John DeLoche (SVB and Credit Suisse) and associate Lak Anath (3i Group). Not only will the Joaquin’s addition help Bridgescale expand its credibility among entrepreneurs, but also will augment the firm’s post-deal operational expertise. In addition to co-founding When.com and running Xoom, Joaquin is a former Mac programmer who co-founded Clearview Software (acquired by Apple) and was president and CEO of Ofoto (acquired by Eastman Kodak).
He says he has been considering a move to venture capital for a while, and had dipped his tow into the investment waters by doing some angel deals. “I love working with entrepreneurs, and wanted to find a team where I really fit,” he explains.
Cowan and Chaplinsky say that Bridgescale will maintain its mid-to-later-stage focus, but add that Joaquin also might expose the firm to some earlier-stage opportunities with similar risk profiles. Certain Web 2.0 companies, for example, operating with capital efficient business models may be of interest.
Bridgescale currently has four companies in its portfolio, including one deal that remains unannounced. The others are: Communications semiconductor company Cortina Systems, mobile game developer Digital Chocolate and messaging security company Proofpoint.