Palo Altos Hambrecht to increase Israel investments

William R. Hambrecht founded his own investment bank in 1998, incorporating many Internet-related technological innovations, after Hambrecht & Quist was purchased by Chase and became Chase H&Q. Chase H&Q has remained an investor in the Polaris-Eucalyptus venture capital funds in Israel.

Mann was interviewed at Hambrecht headquarters in San Francisco, along with Duane Kirkpatrick, the newly appointed managing director for international operations. As a former executive with Robertson Stephens involved in negotiating that bank's current affiliation with Evergreen Venture Capital, Kirkpatrick has his own close relationship with Israel.

"We have identified our candidate to be the firm's Israel representative, and we expect to make the announcement of his appointment imminently," Mann said.

"This is the next logical step in our long involvement with the Israeli financial and high-tech community, such as our [non-exclusive] partnership with Oscar Gruss of Tel Aviv [and New York], our underwriting of the Nogatech IPO, our subsequent role in the acquisition of Nogatech by Zoran, and our dealings with a number of Israeli law firms, including Eitan Pearl Latzer and Cohen-Zedek and Yigal Arnon, among others."

According to Mann, Hambrecht already has appointed a director for the WR Hambrecht Venture Fund: Mike Szeto, formerly of J.P. Morgan.

"We have already invested $100 million in 58 portfolio companies, and we are currently considering two Israeli companies. Until now, we have been investing in Series B and C rounds of financing, but we anticipate that we will now be moving into earlier stage investment as well," Mann said.

Mann foresees two main sectors of increased activity for Hambrecht in Israel.

"One is in the arena of mergers and acquisitions," he said. "There are some great opportunities in Israel, because many of the bigger investment banks are interested only in billion-dollar deals, or in taking companies public."

The other area is in venture capital investment, but with the on-line twist for which Hambrecht has become known.

"Typically, we will invest in companies using the following formula: Bill Hambrecht will invest 25 percent personally, the firm will invest another 25 percent and then we will offer 50 percent to accredited investors over the Internet," Mann said.