Liberty Lake company handed $16.6 million

Purcell Systems, of Liberty Lake, which makes enclosures to protect batteries and equipment for cell phone towers, has raised $16.6 million in venture-capital funding.

The company backing fast-growing Purcell is Weston Presidio, based in San Francisco. Weston Presidio is one of Silicon Valley’s major venture firms, having made big investments in companies such as JetBlue Airways and Restoration Hardware.

Purcell will use the $16.6 million to try to increase its market share in the wireless phone industry, as well as make inroads with traditional phone and data networks, said company CEO Pete Chase.

The investment also will let Purcell focus on developing new markets overseas and among cable companies as they start offering telephone service to their customers, he said.

“The way to keep growing is to diversify and not get pigeonholed,” Chase said after the funding was announced this week.

What attracted the investment was Purcell’s profitability and its strong growth in the power-cabinet market, said Kevin Cable, executive vice president of Cascadia Capital, a Seattle investment bank that helped arrange the deal for Purcell.

Purcell was started in Liberty Lake in 2000 and has just about doubled its sales every year since 2001, Chase said. It racked up $12 million in sales in 2002, $21 million in 2003 and expects to hit about $46 million this year, he said.

Purcell has about 75 employees in its current Liberty Lake building, just off of Appleway. The company could construct a new building in Liberty Lake later this year to accommodate its expansion, Chase said. He declined to give details about that project.

Chase said Purcell’s employee count could reach about 90 by the end of the year.

Purcell’s big infusion of cash is part of a series of outside investments made in area technology companies in recent months. Other companies that have landed significant venture funding here include Avista Laboratories, now called ReliON; World Wide Packets; and Nighthawk Radiology, of Coeur d’Alene.

“Purcell Systems’ financing is just one more example of the level of success that technology companies can achieve in our region,” said Jon Eliassen, president and CEO of the Spokane Area Economic Development Council. “It’s proof that our local companies can sell worldwide and attract investment capital from major national firms,” he said.

In return for the money Weston Presidio is providing, the venture firm will be able to place two people on Purcell’s seven-person board of directors.

Chase and Cable both say that Weston’s deal was the best among several venture-capital offers Purcell considered. “Weston Presidio is a very highly regarded firm. They’re known for their ability to add high value to the companies they invest in,” said Cable.

Choosing Weston Presidio was fairly simple, Chase added. Unlike other venture firms that extended offers to Purcell, Weston Presidio’s offer didn’t include conditions that involved controls or a set timeline for return on the investment, Chase said.

“We know they’re also a very consultative kind of company with lots of experience and contacts,” Chase said. “If we ask, ‘Can you open some doors for us in this industry?’ that could very easily happen.”