We consider Rule Breakers the young, newly public firms that are growing like weeds. Think of them as the market's teenagers. We're talking about the best, of course -- the ones who will go on to college, major in chemistry and English, graduate with honors, marry a supermodel, and produce a litter of beautiful little geniuses who will one day cure cancer.
So far, we've done pretty well with our picks. The Motley Fool Rule Breakers portfolio has beaten the S&P 500 by nearly 10 percentage points in its short existence. But we believe we can do better. Starting today, we're going to expand our scouting from the high schools to the preschools. I'm talking, of course, about Baby Breakers -- newer companies pursuing private funding who could find their way onto the public markets in the next three to five years. Starting today and continuing every Friday, we'll profile the week's most interesting venture capital deals. Here's what we saw this week.
On Monday, Ascend Ventures led an "A" round -- code-speak for the earliest round of private equity a firm takes -- worth $3 million for ClassLink, which provides software to aid learning for K-12 students. Its technology, called the ClassLink System, purportedly creates individual learning environments that can be accessed anywhere there's a computer with a Web connection. Perhaps it can do for the public school system what Motley Fool Hidden Gems pick Blackboard (Nasdaq: BBBB ) does for colleges?
Wednesday, Tengion, which is attempting to build a revolutionary business around organ and tissue regeneration, received $39 million in its first round of private equity. According to VentureWire, Tengion was brought to life with the help of David Scheer, whose biotech advisory firm has a reputation for building viable stand-alone biotech companies, including Esperion Therapeutics, which last year was acquired by Pfizer (NYSE: PFE ) for $1.2 billion.
Finally, could we close without mentioning Baidu, the upstart Chinese search engine that wants to be Asia's answer to Google (Nasdaq: GOOG ) ? Of course not. Because of increased demand, Baidu yesterday raised the price target of its pending IPO to $23 to $25 per share from $19 to $21 per stub. Surprised? Don't be. It seems everyone -- including some of us Fools -- expects the company to be the next Google.
For more Rule Breaking Foolishness, check out:
- What are the six signs of a Rule Breaker, you ask? Read what Fool co-founder David Gardner has to say.
- Rule Breakers recommendation Intuitive Surgical (Nasdaq: ISRG ) recently proved it belongs in the portfolio.
- Looks like Atkins Nutritionalswas a Faker Breaker.
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Fool contributorTim Beyersthinks his wife is a supermodel and his three kids are little geniuses who will cure cancer one day. Tim didn't own shares in any of the companies mentioned in this story at the time of publication. You can find out what's in his portfolio by checking Tim's Foolprofile. Pfizer is a Motley Fool Inside Value recommendation. The Motley Fool has an ironcladdisclosure policy.