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Gil Amelio makes first OC investment

Orange County has a new fiber optic gear maker on the block,with an investment from OC’s newest venture capitalist.

Newport Beach-based Newport Opticom, a fiber optic startup, recently closed its first round of funding worth $7 million, according to sources familiar with the deal.

The investment marks the first OC round of funding for Sienna Ventures Southern California office, started by former Apple Computer Inc. chief executive Gil Amelio. Sienna led the round, which also included investments from the Irvine office of InveStar Capital Inc. and others.

“We certainly like the technology. The company’s product will be the foundation for the future,” said Michael Feng, an InveStar partner.

Newport Opticom plans to use the money for basic startup costs and staffing, sources said. Company executives declined to comment for this story.

Newport Opticom joins a growing list of Orange County fiber optic and semiconductor startups receiving funding recently. This year, Irvine chip designers 3DSP Corp. and TransDimension Inc., as well as VSK Photonics Inc., an Irvine components maker for optical networks, closed new rounds of funding totaling nearly $35 million. A handful of smaller photonics companies and chip designers also have received money in recent months.

“We’re seeing better deals and more deals in infrastructure and enabling technologies,” said Randy Lunn of the Irvine office of Palomar Ventures. “That’s more investments in semiconductor chip areas, wireless and enabling business software.”

As local venture capitalists tell it, the failure of Internet businesses points out the obvious: there just aren’t enough pipes to make serious money selling over the Internet. They say investments need to go to the companies that make the pipes,or speed the flow of data over them. In all of last year, venture capitalists sunk $1.5 billion in OC companies, which are entertaining the eyes of more venture capitalists, recently.

Sienna’s Amelio is one of them. Amelio had sought to move back to Orange County from the Bay area for some time. Earlier this year, he sold Beneventure Capital, a firm he founded, to Irvine-based Advanced Communi-cations Technologies. He also signed a letter of intent to take over Advanced Communi-cations as the chief executive.

Amelio opted not to take over Advanced Communications and took a position as senior partner at Sienna Ventures, which made him the head of the firm’s Southern California office.

“Our sense of this is that there are burgeoning deals in the south. We’re looking at being in disruptive technologies,” said Amelio, adding that 80% of Sienna’s funds are in communications and 20% in other technologies such as Internet security.

Sienna has invested in companies such as Redwood City-based OpenWave Systems Inc., formerly Phone.com, Irvine-based Autobytel.com Inc. and Norwalk, Conn.-based Priceline.com Inc. n

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