July 15, 2008

By Paul Feinberg

There was a time when some of your most important business meetings took place after a round of golf at the country club, while quaffing Cosmopolitans and club sandwiches at the 19th Green. Forget the office; the club was where the real deals went down.

But, times change. Nowadays, a couple of duffers who met in b-school can set a deal in motion while three-putting their way around some beaten up public course. At least, that’s the way it went down for Maneesh Goyal (’06) and classmate Dan Henderson (’06), when a chance conversation led to Goyal’s company, Miramar Venture Partners, funding Henderson’s firm Fastsoft, Inc.

Henderson the entrepreneur met Goyal the venture capitalist at UCLA Anderson. They became friends, taking many of the same courses and working on the same Applied Management Research (AMR) team. As AMR teammates, they (along with two other classmates) chose the Business Creation Option (BCO), creating an Internet video company that was the first to receive funding from Anderson, as both the Center for International Business Research (CIBER) and the Harold and Pauline Price Center for Entrepreneurial Studies invested.

They also took up golf together.

“Maneesh and I both started learning golf while at Anderson,” Henderson said. “We played a bunch together badly at first, then we got to the point where (maybe) we were okay.” After graduation, the pair went their separate ways, keeping in touch with an occasional round.

Sitting with Henderson and Goyal in a Pasadena Starbucks not far from Fastsoft’s corporate home, it’s clear the two have developed a close, trusting relationship. They pick up on one another’s stories, adding details, occasionally finishing each other’s thoughts. It’s Henderson who politely interrupts an interviewer’s question to point out that Goyal was a Kaufman Fellowship finalist and a Venture Fellow at Anderson.

After Anderson, Henderson went looking for a position with an early stage technology company -- “That’s my world, that’s what I do and love” -- and in the fall after graduation he landed a vice-president’s position with Fastsoft. At the time, the company was basically just the two Cal Tech scientists who founded the company, a couple of engineers and an admin. Henderson was the first “business person” to join the company and he considered it a perfect opportunity.

Fastsoft’s proprietary technology allows companies to accelerate the transfer of video and other large files out into the world. Their customers are companies in media and entertainment. Disney, Technicolor and ESPN are among their first clients. Fastsoft is not the only technology to enable faster file transfer, but they are the only company in a crowded field that does not require both the sender and receiver to use the technology. With Fastsoft, only the sender needs to be a client, anyone with a computer on the other end can receive the benefit of faster downloads.

While Henderson was getting started at Fastsoft, Goyal was considering positions with VC firms, eventually landing a position at Miramar. “We’re a traditional venture capital firm,” Goyal said. “We invest in early stage companies, typically product companies in technology ... broadly speaking, (it’s) software and hardware.”

It was a cold and blustery day in January 2007 that the pair found themselves on the course. They suspect Goyal was winning, crediting the extra month or so it took him to find his post-Anderson job.

“We were just comparing notes, asking each other 'how is your job going,'” Henderson said. “And I said, 'We’re really looking to raise some venture capital.' And I told him a bit more about the company and as I recall he said, ‘You know, why aren’t you talking to us? We do very early stage technology (companies.)”

“After we left, I just said ‘Dan, send me over a standard pitch deck.’ And he sent that over and I handed it over to one of our partners, telling him that it was a company I knew about and asking if he was interested in talking to them,” said Goyal. “We predominantly invest in Southern California so it was really in our wheelhouse in terms of technology, stage, location ... and one of the partners agreed to take a look.”

Miramar looked and liked what they saw. Fastsoft’s technology had made a huge splash in the scientific and research realm prior to forming the company and set records at the Supercomputing Bandwidth Challenge four years running. The intellectual property, a key point for Miramar, is owned by Caltech, whose prestige in the community offered the desired defensibility of the product in both the scientific and business communities.

They must have seen the business potential, as it goes without saying that a VC firm doesn’t do a deal because a couple of b-school buddies had a conversation. After the initial meeting, Goyal continued to provide research and diligence support. “What I did do was vouch for Dan, in terms of management,” Goyal said. “Dan was the business guy there so I said, ‘He’s somebody I trust.’ That counts for something and removes some risk.”

“In terms of our personal relationship, you are absolutely right, it wasn’t a deal because we knew each other,” Henderson confirmed. “But (our relationship), at least from my perspective, it oiled it. When we were going through the due diligence and doing the specs,  because Maneesh and I worked together and had developed a working relationship, it was very easy for us to communicate back and forth. So, I felt that the diligence went fairly quickly (as a result).”

Ultimately, Fastsoft raised 4.3 million dollars in Series A money. Roughly half was from angel investors and the rest from Miramar. Henderson reports that 2007 was a very good year for the company in terms of revenue and they are now back on the road looking for Series B funding. Miramar supports Fastsoft, introducing them to potential customers and helping them find appropriate personnel to staff the growing company. Goyal continues to work at Miramar supporting portfolio companies, identifying growth drivers and evaluating prospective investment opportunities.

For his part, Henderson describes his role as “the company evangelist.” He says, “There are two functions to my role. One is the strategic side and one is the tactical side. On the strategic side, I work with the founders to set the company direction, figuring out what markets we’re going after and why. On the tactical side, I (strive) to get the word out, working on the message and value proposition.  Wherever I go, whether it’s a trade show or a golf tournament, I’m always telling people, ‘Hey, this is what my company does.’”

Media Relations