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Well-backed Net funding firm out of hiding

A once-secretive company loaded with venture capital launches a service that will provide established brick-and-mortar retailers with the funding, technology, and expertise to set up shop online.

A once-secretive company loaded with venture capital launched a service today that will provide established brick-and-mortar retailers with the funding, technology, and expertise to set up shop online.

As previously reported by CNET, New York-based Online Retail Partners is funded by Comcast Interactive Capital, John Malone's Liberty Digital, Pequot Private Equity, and a host of other venture capital firms. Global Retail Partners, a growth capital fund backed by Paul Allen, Donaldson, Lufkin & Jenrette, and French retailer Carrefour, is also pumping funds into Online Retail Partners. Cable television mogul Malone owns a major stake in Liberty.

The company hopes to help retailers focus on leveraging their brands and marketing prowess as they migrate online. To help a retailer set up an independent e-commerce business, Online Retail Partners plans to contribute much of the initial round of financing. The company will also provide the elements essential to building brands on the Internet, including the technology resources and teams of professionals. It will also assist start-ups with critical logistics and customer-service functions.

The first two retailers using its services are Zany Brainy and Dick's Sporting Goods. The company said it plans to recruit more retailers as well as expand the number of venture capital investors backing the company.

Venture capitalists, who have been closely associated with Internet start-ups, are now increasingly funding the panicked migration of many land-based retailers to the Web. Though, unlike Web consulting firms, venture capitalists share equity holding in the company.

"We are strictly equity investors," said Henry Nasella, chief executive of Online Retail Partners. Nasella added that retailers feel greater confidence venturing online seeing that his company is putting its "skin into the game."

Nasella, who is chairman of Online Retail Partners, was previously the president of Staples and chief executive of Staples USA.

"We make our money through the success ultimately of a future [ initial public offering] or through opportunities for mergers and acquisitions," said Nasella.

While each of the new retail sites will operate separately from one another, they will be loosely affiliated under the Online Retail Partners umbrella.

"We see a lot of strategic value to Comcast and Liberty Digital's investments as we look forward to broadband and all the potential there," said Nasella.

In addition to an undisclosed amount of initial working capital, the company announced it has raised $62 million in its first round of financing.