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Ebb & Flow

The quiet shuttering of the doors at DoubleTwist serves as a reminder that even smart money can get cooked when chasing the latest trend.

On the promise of the marriage between information technology and life sciences, the company was able to raise $76 million through a group of blue chip VCs. That group included Mayfield Fund, Institutional Venture Partners, Kleiner Perkins Caufield & Byers, MDS Capital, Boston Millennia Partners, Levensohn Capital Management, Moss Forest Ventures, The Burrill Agbio Capital Fund, Mitsui & Co. (U.S.A.), MPM Asset Management, T. Rowe Price, the INVESCO Global Health Sciences Fund, Lone Pine Capital, and Amerindo Investment Advisors.

G. Steven Burrill of Burrill & Co., whose Burrill Agbio Capital Fund invested in DoubleTwist's $37 million venture round in February 2000, told Ebb & Flow that the company was a victim of the genomics bubble bursting, and would have been able to build a sustainable business had it gotten IPO financing. The problem, he said, is that the company had a lot of good ideas but not enough focus.

"They kept trying to morph the product," Burrill said. "They had four or five different ideas - from 'mygenome.com' to an annotated genome business. Had the IPO gone through, I think they would have been fine. Most companies don't fail 'technically', they fail strategically, and here's a technical failure. They didn't get out when they needed to."

DoubleTwist's IPO intentions were left twisting in the wind when the genomics bubble popped in the spring of 2000. The company withdrew its deal in March, killing its hopes of raising $65-$75 million through the sale of 5 million shares at $13-$15 via Lehman Brothers; Dain Rauscher Wessels; Thomas Weisel Partners; and Fidelity Capital Markets.

DoubleTwist started life as a contract developer, providing one-off solutions for companies such as Incyte (INCY) that were developing gene expression databases. It then migrated into proprietary

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