Seattle-Area Company Closures: Sotto, TeachFirst, and Ultreo Shut Down
It’s rough out there, as everyone knows. Yesterday, Dow Jones VentureWire ran a story about venture-backed companies that have shut down this year. Their list includes three Seattle-area firms. Before we see too many more of these reports, Xconomy would like to start gathering lessons learned from startups, investors, and observers. Many people still seem worried about the stigma of failure, even though it’s a normal (and necessary) part of a healthy ecosystem. We want to hear your stories.
—Bellevue, WA-based Sotto Wireless has been winding down operations for the past eight months and is now out of business, according to VentureWire. The wireless service provider, led by former McCaw Cellular exec Rod Nelson, was developing software to help mobile devices connect to cell and broadband networks as you move around. Sotto had raised nearly $14 million in venture funding from Bellevue-based Ignition Partners and Silicon Valley-based VantagePoint Venture Partners. That includes an $8 million Series A round in 2006.
It’s obviously a setback for Ignition and VantagePoint. But in the past two weeks, Ignition—which has taken its lumps lately, having backed the bankrupt Seattle firm Entellium—has invested in California startups Enclarity and Zenprise. And VantagePoint recently raised $435 million for its second venture fund; one of the firm’s focus areas is cleantech and alternative energy.
—Seattle-based TeachFirst, an educational training company, has filed for Chapter 7 bankruptcy, according to VentureWire. The company was founded in 2000 by Sandi Everlove and Don Nielsen, to improve teacher training and student learning by using video libraries and collaboration resources. TeachFirst was backed by angel investors and small funds with an educational focus.
—Redmond, WA-based Ultreo, maker of an electric toothbrush that uses ultrasound to help clean your teeth, has closed after failing to find a buyer or additional investor, according to VentureWire. (Northwest Innovation reported the company auctioned off its assets last month.) Ultreo was founded in 2003 and had raised some $28 million in venture funding, including an $11.3 million investment in May 2007 from Polaris Venture Partners, Buerk Dale Victor, WRF Capital, and angel investors. Led by Jack Gallagher, Ultreo competed with industry leader Sonicare, which is owned by Royal Philips Electronics, in the sonic toothbrush market.
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