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Veterans from Fore snag funds for venture
Saturday, March 11, 2000 By Ken Zapinski, Associate Editor/Business
Some former Fore Systems employees branching out on their own into one of the hottest areas of the Internet have snagged $12.3 million in venture capital financing.
Laurel Networks, which was founded in October and employs about 35 in Wexford, is developing switching systems to direct Internet traffic traveling as tiny pulses of laser lights.
Experts see optical technology as key to further development of the Internet. Sending data as different colored pulses of laser light allows a single hair-thin fiber-optic cable to carry as much traffic as a thick bundle of cables.
More and more companies are creating fiber-optic networks, some of which reach all the way to the desktop. And new optical equipment is needed to handle the ever growing amount of traffic faster and more efficiently.
Investors have gone crazy over optical infrastructure companies. Sycamore Networks, which builds networking equipment for fiber-optic systems, went public in October at $38 and is trading above $170, even after a 3-for-1 stock split last month. At the time of its initial offering, Sycamore had never made a profit, had only 200 employees -- and ended its first day of trading with a market value of $14.4 billion.
It was that same month that Atul Bansal, Robert Rennison, Robert Warden, Jeff Prem, Dimitris Varotsis and Steve Vogelsang founded Laurel Networks. "We recognize that optical technology is becoming more pervasive, not just in the Internet core" but in more and more parts of the data network, Vogelsang said.
He said that Marconi Communications' purchase of Fore Systems last year was not the cause of the group's departure but may have accelerated the process. Each member of the group had been at the tech company for at least four years.
"Fore had become a bigger, more mature company," Vogelsang said. "We all had the entrepreneurial spirit and we wanted to do something new."
The $12.3 million in financing comes from a group led by New Enterprise Associates, of Reston, Va., and includes Rein Capital of Lakewood, N.J. Laurel Networks plans to have products developed for sale by next year, Vogelsang said.
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