CONCORD — The New Hampshire Executive Council Wednesday approved the sale of the former campus of Great Bay Community College to Juliet Marine Systems, Inc. for a purchase price of $2.75 million.

Approval means the Community College System of New Hampshire (CCSNH) can move forward with the sale of the former campus, which CCSNH vacated in 2009 when it relocated Great Bay Community College to the Pease International Tradeport in Portsmouth. Wednesday’s vote follows unanimous approval from the state’s Long Range Capital Planning and Utilization Committee on April 16.

Juliet Marine Systems, Inc. (JMS) was founded in 2004 and has pioneered several highly advanced technologies that will dramatically change the marine industry’s understanding of propulsion for surface and sub-surface, manned and unmanned vessels. The JMS research and development vessel, GHOST, is a high performance craft that will revolutionize the way small boats operate on the water. JMS anticipates that as the company grows, it will provide job opportunities in many business and technical areas, and the facility will provide JMS with room to expand.

JMS and CCSNH leaders say the expansion of JMS to the Stratham site will have a significant economic impact on the state and region and will result in the creation of hundreds of jobs in New Hampshire. JMS’s plans are to establish its corporate headquarters at the Stratham facility, and to use the facility for research and development and for manufacturing. JMS anticipates it could grow its workforce by 200 people over the next two years in skilled fields such as technical assembly, engineering, customer support, corporate executives and staff. JMS and CCSNH anticipate working together to meet the company’s skilled workforce training needs.

CCSNH Chancellor Ross Gittell said, “The Community College System is excited to be working with Juliet Marine Systems to create the opportunity for this innovative company to expand its operations in New Hampshire, create jobs, expand relationships with local suppliers and support the state and local tax base. This is a win for the New Hampshire economy, and CCSNH looks forward to our continuing role in supporting the state’s innovation-based economy through education and industry partnerships.”

Sean Ludwig

Hot database-as-a-service startup Cloudant has raised $12 million in its second round of funding, the company announced today.

Boston-based Cloudant was initially founded in Cambridge, Mas. in 2008 by three MIT physicists. The team struggled to move around multi-petabyte data sets and analyze those data sets wherever they went. So they ended up creating what would become Cloudant.

Cloudant offers a highly scalable database-as-a-service that makes it possible to store, access, and analyze your operational data in the cloud. In the layers of the cloud, Cloudant becomes a “data layer” that can be run on top of most infrastructure-as-a-service providers, including Amazon Web Services, Rackspace, SoftLayer, Microsoft Azure, and Joyent.

Cloudant CEO Derek Schoettle told VentureBeat that this “agnostic” approach to infrastructure deployment separates it from its biggest competitor — Amazon database services. “We believe in not having vendor lock in,” Schoettle said.

Cloudant has attracted some big-name customers with its approach, including Samsung, Microsoft, Adobe, Nokia, Salesforce, Expedia, Zynga, and Flurry.

The new funding was led by Devonshire Investors, Rackspace Hosting, and Toba Capital, with participation by current investors Avalon Ventures, In-Q-Tel, and Samsung Venture Investment Corporation. Including the new round, Cloudant has raised $16 million to date.

“One of the reasons we let Rackspace invest is because of their committment to customer service,” Schoettle said. “We also believe in that.”

In addition to funding, the company has opened up a new office in San Francisco, which joins the Boston HQ and offices in Seattle, the U.K., and South Korea. In the next 90 days, Schoettle said the company will open another office in Hong Kong.

Database-as-a-service (DBaaS) provider Cloudant has received $12m (£7.8m) to help it set up new offices, employ more staff and bring its technology to new markets.

Deanna Brown, who was the CEO of Federated Media, has joined e-singles startup Byliner as president, the company announced Thursday.

Brown has a long history in the digital media industry. Before her time at Federated Media, she held executive roles at Scripps Networks Interactive, Yahoo and AOL. She was the CEO and cofounder of Inside.com, the founder of Gaming Industry News, and the cofounder of Condé Nast’s digital division, CondéNet, in 1995.

Byliner, which is based in San Francisco and was founded in 2011 by former Outside Magazine editor John Tayman, sells fiction and nonfiction e-singles individually and also offers subscriptions. The site also hosts a large library of content posted elsewhere and lets users follow their favorite writers.

“I really wanted to work with a startup again, using my experience in building and scaling promising new ventures, but I also wanted to be part of something I’m personally very passionate about,” Brown said in a statement. “I love the content business, and I hold great writers and their work in the highest esteem. I’m a huge reader and own five different digital readers. Byliner is a perfect fit — for both head and heart — and makes great sense at this point in my career.”

Avalon’s Lichter and GSK’s Cardon

wsj.com

GlaxoSmithKline PLC will partner with venture capitalists from San Diego in an unusual deal worth up to $495 million to start several drug-discovery firms over the next three years.

Under the collaboration, the British drug company will provide financing and technical support to small startups established by Avalon Ventures to explore promising targets for drugs. Glaxo will have to sign off on each startup, and if a technology pans out, Glaxo will have first rights on buying the startup, according to the drug maker and venture-capital firm.

Avalon will contribute up to $30 million in funding, while Glaxo could pay as much as $465 million in seed funding and payments if various development milestones are met. The companies expect the arrangement will involve about 10 companies.

“We are going to immediately own this idea if it is successful, and the level of financial exposure is, frankly, quite small,” said Moncef Slaoui, who heads Glaxo’s research and development.

The partnership marks the latest experiment by a big drug maker looking for new ways to kick-start the difficult search for new medicines, outside of their walls and with minimal risk.

After their own laboratories suffered notable setbacks, big pharmaceutical companies have increasingly turned to outside laboratories for promising new drugs. They have bought experimental medicines from biotech companies and sometimes gobbled up the biotechs whole, though some of those deals have been costly and haven’t worked out as hoped. Last month, Glaxo said it was closing the Cambridge, Mass., offices of Sirtris Pharmaceuticals, bought in 2008 for $720 million, after setbacks including the failure of a drug that contained a reformulated version of resveratrol, a substance found in red wine.

Glaxo, Pfizer Inc., PFE -0.42% Novartis AG NOVN.VX +2.00% and others also began collaborating more with universities for help identifying promising drug targets. And companies such as Eli Lilly LLY +0.28% & Co. are running their own venture funds.

At the same time, Glaxo and other companies have rejiggered their internal laboratories, sometimes cutting jobs and dividing the remaining scientists into smaller units to try to rekindle the innovation that executives believed their large bureaucracies were stifling. Glaxo says its smaller lab groups, established about six years ago, have so far delivered two experimental drugs into midstage human trials and one into late-stage human testing. Glaxo in the coming months plans to analyze the productivity of its internal researchers versus the company’s external collaborators, “to create some healthy level of competition,” Dr. Slaoui said.

The distance between drug makers and venture capitalists—historically arm’s-length until a pharmaceutical company was interested in buying a venture-backed biotech—is also shortening. Last year, Glaxo and Johnson & Johnson JNJ +0.40% teamed up with Index Ventures on a $200 million biotechnology fund, while Merck & Co. backed a $270 million Flagship Ventures fund.

Glaxo’s interest is to tap into the access that venture capitalists like Avalon Ventures enjoy with researchers in San Diego, a premiere hub of biomedical research, Dr. Slaoui said.

For Avalon’s part, Jay Lichter, a managing director who heads its life-sciences investing, says that fundraising and profit-taking have gotten tougher for life-sciences venture funds. “In our world today, financing risk is greater than the technical risk” of turning a promising drug target into a viable drug, Dr. Lichter said.

Depending on the molecule, it can cost $15 million to $50 million to take a promising idea through proof-of-concept testing in humans, Dr. Lichter said. “The odds of raising enough money to get there in today’s market are slim to none,” he said. U.S. venture capitalists invested $3.6 billion in drug startups last year, down from a peak of $6.2 billion in 2007, according to Dow Jones VentureSource.

The companies created as part of the collaboration will have only a handful of employees each, will be housed together in a life-sciences complex beside the Torrey Pines Golf Course’s driving range, and will focus on a single compound each, Dr. Lichter said. The startups could target a wide range of medical conditions such as cancer and infectious diseases, and use technologies ranging from small molecules to recombinant proteins, he said.

The new Glaxo-Avalon collaboration followed from a two-decade relationship between Dr. Lichter and Lon Cardon, a research executive at the British drug maker. The two men had worked together in the early 1990s at a San Diego biotech called Sequana Therapeutics that hunted for genes driving diseases such as diabetes. Dr. Lichter said the seeds for the new partnership were planted when the two ran into each other at an event in San Francisco last summer.

Avalon, founded in 1983, invests in both life-sciences and information-technology companies. Among the firms it helped establish is social-gaming company Zynga Inc. ZNGA +1.24% The biotechs that Avalon helped create include Amira Pharmaceuticals Inc., which Bristol-Myers Squibb Co. BMY +1.86% agreed to buy in 2011 for $325 million upfront. This year, Avalon-backed Afraxis Inc. and RQx Pharmaceuticals Inc. inked deals with Roche Holding AG’s RHHBY -0.98% Genentech unit that could be worth up to $187.5 million and $111 million respectively.

Write to Jonathan D. Rockoff at jonathan.rockoff@wsj.com and Jeanne Whalen at jeanne.whalen@wsj.com

TechCrunch

Do you target kids with cheap ads or more expensive adults? Nanigans has just raised a $5.85 million “Series A.1″ from Avalon Ventures to build SaaS technology that predicts which audiences earn advertisers more money. With revenue up 6x in 18 months, Nanigans hopes to keep up with Facebook’s progress by pouring its funding into R&D. It’s already discovered a surprising trick to supercharging ROI.

In advertising, there are three numbers that really matter. Cost per acquisition (CPA) – how much you pay for a customer; lifetime value (LTV) – how much you earn off that customer; and return on investment (ROI) – how much higher your LTV is than your CPA. Most advertisers don’t have the technology or data to accurately predict LTV, so they aim to get the lowest CPA so a smaller LTV will still produce ROI.

But Nanigans has found that doesn’t actually work so well, and it’s building the technology to prove it. Founded in 2010, the company had previously raised just $3 million in a mid-2011 Series A to build its licensable self-serve tool for buying better Facebook ads in exchange for monthly or yearly fees, or a percentage of spend. The tool lets businesses buy, intelligently target, and A/B test huge Facebook ad campaigns much more efficiently than Facebook’s basic tools. Nanigans’ focus on technology and delivering lifetime value over smaller immediate returns has been a hit with social game and e-commerce game companies.

Now it believes it’s No. 1 or at least in the top 3 Facebook adtech companies in terms of revenue, which grew 6X since its last funding round. It now boasts customers, including eBay, Fab.com, Rue La La, Zynga, GSN, Wooga, Kixeye and Kabam. It’s now running hundreds of millions of dollars of Facebook ad spend per year, and has grown from 15 employees to more than 100 in just a year with offices in San Francisco, New York, Boston and London.

The Nanigans secret sauce is its predictive modeling engine, which can both deduce and track how much a customer spends. This lets it determine that while it might cost an e-commerce company 3x as much to acquire a 25-year old Australian female, she’ll earn them 5x as much as a 15-year old Australian male. An advertiser may have to invest more up front, but in the long-term they’ll be richer for it.

Nanigans CEO Ric Calvillo (caricatured above)  tells me “Online performance advertising is broken for the most part, and ripe for disruption. Most campaigns for online conversion are not well-optimized. Most marketers optimize for the lowest cost something — cost per click, cost per thousand impressions, cost per action — but when you optimize for the cheapest cohorts you’re almost by definition not optimizing for ROI.”

What Nanigans has found is that especially in gaming and e-commerce, “age is a huge factor. If you chart age and cost and revenue, younger age groups are cheaper on a CPA basis, but they generate far less revenue proportionally. About a year ago we realized this. The older, more expensive audiences always have higher ROI.” The theory for why is that everyone is in a mad rush to get young, hip users. The wave of the future, right? Wrong. These kids just don’t have disposable income to spend anytime soon.

So why don’t other adtech companies and agencies know this? Because their clients are afraid to reveal their confidential revenue numbers. Calvillo tells me “software needs revenue on every user to be able to do the predictions. If you’re using a third-party service you probably don’t want to share your revenue details. That’s why our SaaS platform enables this optimization.” Since companies license Nanigans and use it privately in-house, they don’t have to share their revenue stats with anyone. “We can get customers to trust us and optimize for ROI,” Calvillo concludes.

Making this predictive modeling tech even more powerful is the big plan for Nanigans’ new funding from previous investor Avalon Ventures. It will hire more PhD data scientists to aid with research and development of the predictive modeling algorithms. Facebook is also rapidly releasing new ad formats, targeting schemes, mobile, and Facebook Exchange retargeting. Nanigans needs a big R&D budget to build intuitive user interfaces on top of Facebook’s Ads APIs. Otherwise it risks getting beat by competitors like Salesforce’s Buddy Media, or clients going straight to Facebook’s native tools. Nanigans also plans to concentrate on more verticals, including retail, travel and other online conversion businesses, plus do some global expansion with a new office in Singapore.

With Calvillo on the phone and Facebook’s earnings coming up next week, I figured I’d ask his opinion on the state of Facebook ads. Nanigans now sees over a third of ad spend on its platform targeting mobile users. Calvillo and I agree that mobile should account for about 30 percent of Facebook’s total ad revenue in Q1, up from 23 percent in Q4 2012. He says a lot of mobile ad spend is coming from Facebook’s new app install ads as well as from brands, but that there hasn’t been as much spend from e-commerce or direct response advertisers just yet. This leaves Facebook a lot of upside left to capture. Calvillo also notes that he thinks Facebook Exchange is going well, but the departure of its product director Antonio Garcia-Martinez was a big loss for the social network.

As for the future of ads, there’s been a lot of hype about offline purchase data providers partnering with Facebook. I personally believe that with time, this data will reveal the heavy impact of online ads on offline purchases, and make web properties and apps that see a lot of eyeballs worth a lot more in the long term. Calvillo disagrees though, saying “Attributing an in-store conversion to an individual ad is a pretty difficult, complicated thing to do. If the majority of online conversion ad spend is not well optimized, it’s too early to be adding offline complexities.

In the meantime, Nanigans will keep chugging away at making online ads earn their owners more money. I’ve been covering Nanigans for almost three years now, and its progress and revenue growth is impressive. By facilitating so much social ad spend, the company is pumping the lifeblood of innovation into Facebook. Nanigans has strong growth, high-profile clients, gobs of business, and just a lean $8.85 million in the bank, so my question is whether an old ad giant would acquire Nanigans to get some fresh blood itself.

“I’m an investor, and I’m judged solely by financial returns, but there are a lot of ways to [get those],” said Jay Lichter, managing partner with Avalon Ventures in San Diego. “Screwing entrepreneurs and screwing founders because you can, because you have the money, is not the way to be successful in the long run.”

Midwest-raised Lichter, 51, has gained respect during his 20 years with Avalon not only for his plainspoken geniality but also for his solid background in science and keen grasp of money matters.

“He’s a pretty laid-back guy,” said Carmine Stengone, vice president of corporate development for Afraxis Inc., also of San Diego. “I had the stereotype in my head for what a VC would be like – generally intense, at times abrupt.”

Afraxis, an early stage Avalon-backed concern for which Lichter serves as CEO, scored a potential $187.5 million licensing deal with Genentech, a member of the Roche Group, near the start of this year. (See BioWorld Today, Jan. 29, 2013.)

Lichter “doesn’t take himself too seriously, [in] his successes or his failures,” said Heidi Chokeir of the public relations firm Canale Communications. “There’s not a pretentious bone in his body.”

Chokeir has lost count of how many projects she has helped Lichter introduce to the world. “I work with him as a vendor, and he’s always shown me respect,” she said. “He’s never treated me like a ‘vendor,’ he’s treated me like a person – a peer, someone he respects and values. He’s a good listener. He hears what people have to say.”

Because of his humility, “people aren’t turned off by his persona, they’re not intimidated by him,” she said. “But he also exudes confidence, and has the track record to back it up.”

The only Avalon partner focused solely on life sciences, Lichter has been involved in several success stories so far this year: the Afraxis deal, the buyout by BioMarin Pharmaceutical Inc. of Zacharon
Pharmaceuticals Inc. for $10 million up front, and antibiotics firm RQx Pharmaceuticals Inc.’s potential $111 million agreement, also with Genentech. (See BioWorld Today, Feb. 12, 2013.)

Born in Washington, D.C., Lichter moved with his parents and brother to Evanston, Ill., when very young. He graduated in biochemistry from the University of Illinois (UI) at Champaign-Urbana, attended grad school at the UI’s Chicago campus, where he finished his PhD in biochemistry and molecular biology. His postdoctorate work at Yale University “crystallized my path in this industry,” he said, as he trudged in “the foothills of the genomics era.”

Lichter published more than 20 papers in two years, earned a certificate in DNA diagnostics that allowed him to perform tests and counsel patients, and pulled down a fellowship in informatics. “I was in the right place at the right time,” he said.

In the early 1990s, Lichter recalled, he was doing pharmacogenetics research at DuPont Merck Pharmaceutical Co. when Kevin Kinsella phoned. “He wanted to know if I wanted to start a company in genomics. I said, ‘Where’s it going to be?’ He said, ‘I don’t know.’ I said, ‘Who else is involved? He said, ‘Nobody.’ I said, ‘What’s it going to do?’ He said, ‘I don’t know.’ I said, ‘How much money do you have?’ He said, ‘Not much.’”

Lichter laughs about it now. “An offer I couldn’t refuse, right?

‘You Can’t Go in Like a Banker’

He started with Avalon as co-founder of Sequana Therapeutics Inc., which later merged with Arris Pharmaceutical Corp. and became Axys Pharmaceuticals Inc., eventually bought by Celera Corp. for $173 million. (See BioWorld Today, June 14, 2001.)

“We just kept investing through the down days in our core business,” Lichter said. “The notion was that eventually the available Phase II and Phase III assets that are out there, that are good, would be soaked up. It was nothing more than that.”

An element of luck figured in, too, he said. “Our historical track record through our first six funds was very good,” Lichter said. “In the later funds, when we were more mixed, between tech and biotech, we got a lot of patience from our investors because the tech returns were pretty good. Now, the market is changing again a little bit, and tech is maybe a little over-bought, and life sciences is under-bought. So we’re getting some good deals.”

High among them is Afraxis, which began with Lichter perusing scientific journals and finding the work of Nobel Prize winner Susumu Tonegawa, of the Massachusetts Institute of Technology in the Proceedings of the National Academy of Sciences.

“I called him up, and he was skeptical,” Lichter said. “I called him again, and he was less skeptical. I went out and visited with him, spent an hour with him at his office. He got comfortable, and we talked about things, and laughed. He made a few phone calls about me, and checked our track record. And then we started the company. Five years later, we got the Genentech deal.”

Lichter is anything but oblivious to the “very personal aspect” of deal making, he said. “I understand living at the [lab] bench. When you go to an investigator who has spent his career working his tail off on a piece of science he’s very passionate about, you can’t go in like a banker and start trying to purchase it,” Lichter said. “You have to understand that this project is their child, and you’re asking them to give their child to you and help it grow up.”

He has two daughters of his own. “They’re not really into science in the slightest,” Lichter said. The older one, a freshman at Colgate University, is “interested in economics and finance, so I guess in some ways she’s following in my footsteps,” he said, while the younger daughter, a senior at Carlsbad, Calif.’s independent high school Pacific Ridge, is “more of an artist type, a free spirit.”

His business, Lichter said, is “a universe of how to treat people. There are some who say, ‘Forget you, entrepreneur. I’ve got to get my return, and I’ll do it at your expense.’ To our own detriment, we [at Avalon] are probably more generous than we need to be in any particular deal. But what that means is that, across the board, we see a lot more deals from people who trust us. We get entrepreneurs and technology managers who go the extra yard because they know that we’re going to protect them if they take that risk and push the company to the edge to get the better outcome.

There’s a lot of pain the entrepreneur goes through to make [their companies] successful. I’ve lived the pain.”