Fabrik, a storage hardware and service provider, announced today that they’ve acquired G-Technology for an undisclosed amount. G Technology sells external drives that focus on high performance for rich media. Their products are focused on Mac users (thus the announcement today in conjunction with Macworld). G-Technology is also releasing a couple of new products today, including a 1 TB mini Raid USB drive that is bus powered.

G-Technology was founded by Roger Mabon four years ago and is self funded. This is Fabrik’s third acquisition (previously Filmloop and SimpleTech). We’ve been hard on the company in the past (see our coverage of the Filmloop acquisition and CrunchGear’s coverage of MyFabrik), but to be fair the company is executing like crazy. They are on a $200 million revenue run rate for 2008, says CEO Mike Cordono, and are profitable after raising around $50 million in capital. 90% or revenues are from the U.S., so there is lots of room for international expansion. Cordono isn’t talking IPO yet, but it’s clear they are on track for a public offering or a very large acquisition. Cordono says they won’t raise more capital for now, unless its for further acquisitions.

Ross Levinsohn (former President of Fox Interactive) and Jonathan Miller (former Chairman and CEO of America Online) launched Velocity Investment Group earlier this year with the goal of acquiring and investing in digital media startups. Today they are announcing a merger with ComVentures, a venture fund with around $1 billion under management.

This sounds like a bit of a coup. The new entity is taking Velocity’s name and will be called Velocity Interactive Group. Two ComVentures partners – Michael Rolnick and Jeb Miller, will be “pursing other interests,” which is probably just a nice way of saying they were booted from the fund.

This is a rare move for a venture fund, and from what we hear ComVentures has been doing well in its investments. But a series of events, such as the FilmLoop debacle, may have left the brand somewhat tarnished. The fund was also ridiculed for stealing Sequoia’s web site look and feel.

A fresh start for ComVentures isn’t a bad idea, and getting talent like Levinsohn and Miller doesn’t hurt, either. The fund will be opening new offices in Santa Monica and New York, adding to existing offices in Palo Alto, India and China.

The fund is also announcing a few investments, including NDTV Networks, IndiaTV, Fabrik, Doppelganger and Mixercast.

When I added FilmLoop to the TechCrunch DeadPool last month based on rumors of mass layoffs, it was clear there was more to the story. The thirty person company had raised $11.5 million in capital and by any calculation should have still had at least $3 – $5 million left in the bank. They were trailing Slide, RockYou and Photobucket in their market, but had just launched a completely new platform that was getting good reviews. FilmLoop wasn’t dominating the market, but they were not on the ropes, either.

More of the story has leaked, from multiple sources close to the company. Here’s a rough timeline of what appears to have happened:

• January 2005: FilmLoop raises $5.5 million from Garage Technology Ventures (Guy Kawasaki) and Globespan Capital Partners.
• May 2006: FilmLoop raises $7 million from troubled venture firm ComVentures. Roland Van de Meer joins the board of directors.
• October 2006: FilmLoop 2.0 launches. Company and investors are optimistic about FilmLoop
• November 2006: ComVentures, under pressure from its own limited partners to clean up its portfolio and discard any unprofitable startups, meets with FilmLoop to tell them they must find a buyer by end of year. The FilmLoop founders made it clear that they thought they had a good chance at success and did not want to sell. However, ComVentures’ ownership percentage, plus certain rights they have (called “drag along rights”), can force the other investors and the company founders to sell.
• December 2006: ComVentures proposes Fabrik, another one of their portfolio companies, as the acquiror. FilmLoop was unable to find any other acquiror in the last two weeks of the year. Fabrik acquires FilmLoop for little more than the cash ($3 million) that FilmLoop has remaining in its bank account. Due to liquidation preference rights, the founders and all employees walk away with exactly nothing.

In effect ComVentures forced a fire sale of FilmLoop and Fabrik, another company ComVentures invested in, happened to be the only viable acquiror in that limited timeframe. FilmLoop’s desktop and other software will play a part in a future Fabrik consumer storage product. SimpleTech, also acquired by Fabrik and announced today, will provide another piece of the product.

It’s clear that ComVentures had a significant interest in forcing a sale to Fabrik on such a short timetable, during the holidays, when competitive bids would be impossible to find. It’s also clear that this sale was not in the best interests of anyone except themselves. One day, the founders and employees of FilmLoop had a viable company with $3 million in the bank. The next day they had no stock, no job, and no company. At the very least, ComVentures should have abstained from voting on the acquisition.

Founders are under incredible pressure not to rock the boat when venture capitalists pull stunts like this. Engaging in litigation means other VCs will be very hesitant to invest in them in the future. For reputation purposes, founders tend to simply take their beating and walk away, hoping to start all over again with another venture and, hopefully, non-ethically challenged investors. For founders looking for funding – take heed of the FilmLoop story. Only do business with VCs that have a track record of holding up their end of the implicit bargain – to stay with you during tough times as well as good. VCs don’t have any obligation to put good money after bad, but to liquidate a viable startup simply to help out another portfolio company is evil stuff. And make sure you read those drag along and liquidation preference clauses carefully before signing.

I have an email in to ComVentures for comment on this story.

Update: I haven’t heard back directly from ComVentures, although Baris Karadogan, a partner with the firm, has left a comment below.

Update: VentureBeat is tracking this story as well, and has comments from ComVentures.

MyFabrik, loosely related to Maxtor, is a new online data storing/sharing/organizing application that lets you manage files remotely with just a web browser. You can upload and download pictures, music, videos and documents privately or publicly, depending on what permissions you set. The Web 2.0-ness of the web-app comes from tagging, sharing with others, and the ability to quickly post the files you choose onto eBay and MySpace.

It’s aiming to be a one-stop shop for media sharing, attacking .Mac and a number of other players with 2GB accounts for $30 a year and seamless interaction with Maxtor’s Fusion line of hard drives.

CrunchGear will have a hands-on update with the beta impressions soon but until then you can give it a go on MyFabrik.com

Fabrik, a Web 2.0 savvy multimedia storage service, is opening up its web application to a limited number of beta users today. I got a look around inside this system awhile ago and was impressed.

Company CEO and co-founder Mike Cordano came from storage provider Maxtor, now a Seagate company. Chairman and co-founder Keyur Patel came from Maxtor as well, following time as Senior Vice President and Chief Strategy Officer at Inktomi Corporation (a Yahoo! acquisition).

There are quite a few online storage services available (most new and notable could be Amazon S3 and EarthLink’s WebLife). Online storage is good; giving your data to a company that specializes in keeping data secure and backed up makes sense when it comes to things like family or artistic photos and video. Storage and bandwidth are so cheap now that leveraging economies of scale enables these vendors to offer storage and delivery as a commodity. Fabrik media storage plans will start at $3 per month for 2 GB of data storage with unlimited transfers.

Two things make Fabrik stand out right now. First, they offer a very nice web application for organizing your photos and videos. It’s nothing flashy looking but the functionality is smart. Ajax, both tagging and folders are all nicely used to make organizing your files easy. There are quite a few nice little features like the ability to view items on a time line by either creation data or upload date. The service is intended primarily for long term storage of your personal media, but the included sharing features are good as well.

The second thing that makes Fabrik stand out is that its web application is also available for use with local storage. If you have your own network connected storage device you can subscribe to the Fabrik media organizing service at a reduced price. Owners of a Maxtor/Seagate storage device will get an extra discount, but any networked storage device can be used.

There are a couple of ways this could play out when the service really goes to market. There is a belief held by many people today that the new web is made up of 1% content creators, 10% content distributors and everyone else consumes the stuff. Of the 1% of content producers, a smaller percentage still will be producing large quantities of multimedia. Some people talk about pro-sumers instead of consumers. Serious content producers will want a professional service dedicated to long term storage of their media and the Fabrik UI is a good one.

As all of us switch to digital media to document our lives it only makes sense to store that media outside of our own homes. While systems that support both photos and video are becoming increasingly common, price and data limits are unlikely to become cheaper than they already are. Thus a system’s organizing tool is likely to be the key point of differentiation. Fabrik’s combonation of usable metadata and public sharing with an intuitive web based UI is a well executed example of a storage company moving ahead of the pack.