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Moto loses top executive at venture capital arm

The head of Motorola Inc.’s venture capital arm has quietly left the company.

News of Warren Holtsberg’s departure from Motorola Ventures surfaced after MVC Capital Inc., a New York investment firm, announced Wednesday it had appointed Holtsberg to serve on its board of directors and head up the Chicago office of MVC’s investment advisor, Tokarz Group Advisers L.L.C.

Motorola characterized Holtsberg’s departure as a “retirement.” He left the company in February.

Holtsberg, who had held the title of VP of equity investments, becomes the second high-ranking executive to leave Motorola Ventures in the recent past. Managing Director Matthew Growney, who along with Holtsberg and others co-founded Motorola Ventures in 1999, left the company last year to become executive VP of corporate strategy with DarwinSuzsoft Inc., a Massachusetts-based IT services provider.

The last few months have not been kind to Motorola, as its stock price has slid significantly due to slumping earning and narrowing margins in its cellphone business. The tech giant faces pressure from activist investor Carl Icahn, who is agitating for the company to use its $11 billion cash stockpile to buy back shares in order to boost its flagging stock price.

In the wake of Holtsberg’s departure, managing directors John O’Donohue and Reese Schroeder will lead Motorola Ventures. Reese, based in Schaumburg, will oversee Motorola Ventures’ three domestic offices, while O’Donohue, based in London, will oversee the company’s three international offices.

“It’s a very collaborative arrangement,” Schroeder said. “John and I go back many years.”

Motorola Ventures typically invests between $100 million and $150 million per year. Those figures cover investments in about 20 to 25 new companies per year, plus follow-on investments in existing portfolio companies, Schroeder said.

“We’re looking for companies that are a good strategic fit with Motorola,” he said.

Motorola Ventures recently invested an undisclosed amount in DARTdevices Corp., a California-based developer of software for sharing data between personal computers and cellphones. Motorola Ventures’ typical investments are between $3 million and $5 million, Schroder said.

Holtsberg did not return a call seeking comment.

Last year, venture investment by corporate firms accounted for 7.7 percent of all venture investment in the United States, according to the National Venture Capital Association. That figure was up from 6.5 percent in 2005.

Brandon Glenn is a reporter with Crain’s Chicago Business, a sister publication of RCR Wireless News. Both publications are owned by Crain Communications Inc.


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