American Capital Start-Up Stake Unwinds

"We had really two different businesses at the company from the get-go, and it made sense to break it into two pieces and let both groups devote themselves completely to their line of business," Wilkus says.

American Capital's investment was structured as preferred equity and convertible debt and gave the firm a minority interest in Geosign. Part of the funding likely went to Geosign founder Tim Nye through a swap-out of his original equity funding of the company.

Neither company divulged how much of the $130 million was given to Nye personally. It also is not clear why Nye -- the majority investor in Geosign -- would want to split his firm in two and return millions of proceeds to American Capital.

Nye now runs eMedia Interactive, which was part of the split-off from Geosign. An assistant to Tim Nye at eMedia said he is "no longer doing interviews."

In the split-up, most of the Web sites (such as hockey.com) went to eMedia, and the remaining Internet advertising business went to Moxy Media, which American Capital owns.

Wilkus says Moxy Media is profitable but declined to give financial details.

Steve Rossow, vice president of business development with Moxy Media, says the firm is now focusing less on pay-per-click ads and Internet domains and more on a "Web 2.0" advertising strategy that revolves around lead generation.