J.B. Pritzker follows noble tradition of dad
February 27, 2006
BY MICHAEL KRAUSS
What Starbuck's did
for coffee, J.B. Pritzker's father, Don, did for hotels. His Hyatt
Regency concept put glamor, sparkle and experience into an overnight
stay long before the $4 latte transformed the corner coffee shop.
This week, J.B. Pritzker's
New World Ventures celebrates its 10th anniversary. With a little
luck, Pritzker and New World could galvanize Chicago's tech community
as his late father invigorated hotels.
New World Ventures'
success rests on its focus backing tech startups that sell to
large enterprises. Pritzker, 41, and his investors are betting
big behind the strategy.
The jewel in New World's
portfolio is Lisle-based Univa, a global leader in grid computing,
a revolutionary technique that uses the resources of many separate
computers connected by a network (usually the Internet) to solve
huge computation problems.
Univa is hot. It signed
a business alliance with IBM, and if grid computing takes off,
Univa could be the cornerstone of IBM's future. Behind-the-scenes
financing of Univa's success is J.B. Pritzker and New World Ventures.
"When we first
got into the business in 1996, there was a void in venture investing
in Chicago," Pritzker says. "If you were a startup needing
$1.5 million, you were petty much out of luck."
Pritzker aimed to change
One of New World Ventures
early investments was eCollege, an on-line learning organization
that went public in 1999 and recently relocated from Denver to
Chicago. "ECollege was a great success," says Pritzker,
who points to returns exceeding 20 times the investment.
Pritzker has good days
and bad days, but his integrity and commitment to Chicago and
his investors is steadfast. At the height of the dot-com bust,
New World Ventures could not identify reasonable tech investments.
The fund returned capital to investors rather than squander it
in a downward spiraling market.
Pritzker says, "There
were a lot of funds that went ahead and ended up down 50 percent."
to manage his 2000 fund, which includes a number of profitable
investments. He expects that fund to finish among the top quartile
of year 2000 vintage funds.
Tech CEOs often loathe
their VC's. Not Mike Mulica, CEO of Chicago-based Bridgeport Networks,
who praises Pritzker.
Mulica says, "J.B.
is as sophisticated a VC as I have seen. He has a terrific knack
for identifying opportunities. He rates with the top VC's on both
coasts. The good news is, being from Chicago, he values humility
equal to his sophistication."
Mulica's firm develops
software that enables cell phones and VoIP telephones to seamlessly
connect. Bridgeport could revolutionize phone technology, much
the way Univa could unsettle enterprise computing.
Other New World Ventures
portfolio companies with game-changing potential are California-based
Everdream and Color-ado-based Left Hand Networks.
enables corporate IT execs to monitor computers in small satellite
offices. Its largest client is FedEx, which has thousands of computers
scattered around the world. Thanks to Everdream, FedEx can manage
those PCs from Memphis.
Left Hand Networks
is Pritzker's answer to high-end data storage solutions provider
EMC. According to Pritzker, Left Hand Networks has technology
that matches EMC's quality, but at lower cost.
Pritzker is more than
a VC. He's a community builder. Maura O'Hara, executive director
of the Illinois Venture Capital Association, says, "Every
time I ask J.B. to help, he steps up."
Pritzker was pivotal
in creating the Midwest Venture Summit, which showcases local
startups seeking investors.
Pritzker chairs the
Illinois Human Rights Commission. He's a trustee of Northwestern
University, and he's working to rebuild Bronzeville's Pilgrim
Baptist Church. He's also raising money for the Illinois Holocaust
Museum, and he's an advocate of early childhood development programs.
Why work so hard? "I
couldn't imagine it any other way," he says.
Back in 1972, his father
was asked that same question. "It has nothing to do with
money," Don Pritzker told Signature magazine. "It's
really the pride of being involved in something that makes people
say, 'My God, look at this place!'"
If Univa, Bridgeport,
Left Hand Networks or EverDream strike pay dirt, they just might
say that about Chicago tech, thanks in part to J.B. Pritzker.
Krauss is a Chicago area tech writer and consultant.