Focus: Return of the dotcom kids
Clickmango founder Toby Rowland has just won a £23m vote of confidence for his Midas Player games site. Dragons’ Den judge Doug Richard says this shows a new appetite for risk since Skype’s $4bn deal with Ebay. But do British venture capitalists have the cash to back ideas or will the Americans pounce first? Paul Durman reports


When Toby Rowland began raising money for a new internet firm in early 2003, he found it tough going. “People were actually laughing down the phone when we said, yes, it’s an internet start-up in the games area. A lot of people would not take my call.”
Rowland, now 36, was no novice. The son of Tiny Rowland, the late tycoon famous for his battles with Harrods boss Mohamed al-Fayed, Toby had previously run Clickmango, one of the most high-profile firms during Britain’s short-lived dotcom boom in 1999 and 2000. Even though that was unsuccessful, he bounced back with Udate.com, the online dating service sold for $150m (£86m) in April 2003.


Now he was seeking backing for Midas Player, a site that would allow players to challenge online rivals to games of skill for money.

“It was very, very difficult to raise funds,” said Rowland. “In America, there was more wealth created during the internet boom. People were a little bit hardier about investing during the difficult years. In Europe, there was not very much wealth created, and so people were warier in 2003. They had lost money and felt foolish.”

With help from Mel Morris, the serial entrepreneur behind Udate, Rowland and his business partner Riccardo Zacconi raised enough from angel investors to get Midas Player started, formally launching the site in June 2004.

A year later, the fast-growing Midas Player wanted to raise more money to continue its international expansion. This time, the reception Rowland received from potential investors could scarcely have been more different.

Two months ago, Midas Player received €34m (£23m) from Apax Partners and Index Ventures — a huge sum for a first round of institutional investment in a fledgling business. “It’s a great deal,” said Rowland. “We could have raised more than that. We got quite tired of the process.”

For many in the venture-capital industry, Midas Player’s successful fundraising points to a new appetite for investing in risky technology start-ups.

...MORE: http://www.timesonline.co.uk/newspaper/0,,...1869308,00.html


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