It wasn't always that way. Azure was founded in April, 2000, by First Boston investment bankers Paul Ferris and Cameron Lester, as well as research analysts Michael Kwatinetz and Paul Weinstein. They easily raised $530 million and poured much of it into 20 startups, including some high-profile outfits with sky-high valuations. When the Net collapse came, they got pounded. 'Our mistake was doing what everyone else was doing,' says Kwatinetz.
The partners quickly changed tactics. They made their own research central to their investment strategy, focused on early-stage deals, and put in money only if they could get at least a 25% stake and a seat on the board. They also slowed down, making only four to six deals a year, vs. the 20-deal pace of the first year."
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