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Shake-up at WEEI

Little Joe, the footloose gorilla, continues to rattle WEEI.

Change is coming: Tom Baker will step down soon as general manager of the highly rated sports talk radio station. Baker confirms the change but denies it has anything to do with the damage done by his morning drive-time hosts, John Dennis and Gerry Callahan. The two may have thought they were being funny when they compared the escaped gorilla found waiting at a bus stop to a Metco student, but it blew up in their faces, igniting a controversy about their stupid joke.

At first Baker suspended Dennis and Callahan for two days, but as the uproar mounted and advertiser Blue Cross Blue Shield of Massachusetts pulled its ads, the two were benched for two weeks. Both hosts apologized. Said Baker at the time: "They know they made a mistake. They're remorseful."

Not enough. This week Weezie Kramer, regional vice president of WEEI's Pennsylvania-based parent, Entercom, came to Boston to talk about management changes at the flagship station in Boston, according to executives close to the station. Baker is expected to be replaced by the highly regarded Julie Kahn, whom Baker helped hire three years ago as general manager of WAAF and WQSX. The shake-up will put Kahn, 45, in charge of WEEI and WAAF. Baker, 61, will continue to run WRKO and will take over WQSK, the executives said. Baker at first denied the moves but called back to confirm change would be coming in January. "There is no linkage between Metco and the move we are making," he said. Kahn did not return my calls.

Entercom has hired former Suffolk County district attorney Ralph Martin to negotiate a resolution to this latest ugly chapter in Boston's ugly racial history with Metco, a voluntary program that buses Boston students to suburban schools. The best settlement would be one that rights the wrong done to the Metco children and leaves WEEI a better institution. . . .

Tell your kids to be venture capitalists. Charles River Ventures lost 85 percent of its investors' money in one of its most recent funds, and it is now on the streets raising $250 million for a new fund. And several big investors told me they will get it. And here's the most amazing part: The Waltham firm continues to demand -- and will get -- top-of-the-line fees despite its miserable recent performance.

How miserable? "As a matter of long-standing policy, they do not discuss fund performance," a company spokeswoman said. Here, according to one Charles River investor, are the numbers for Fund IX, raised in January 1999: The firm raised $175 million, invested $171 million of that and today the fund is worth a mere $26 million. There have been no distributions to the investors and there are but a handful of companies left in the portfolio.

To be fair, Charles River raised and invested the fund just as the boom was going bust. Virtually every venture fund of 1999 is underwater. Thomson Venture Economics, which tracks the industry, says the average fund of that year is down 18.6 percent, which probably understates the losses. By any measure, the performance of Fund IX is "horrendous," to quote an adviser to another big institutional investor. Of Charles River's two subsequent funds, one remains underwater and the other is too early to judge, the adviser says.

So get your trust funds in early for Fund XII. There's a $2 million minimum, according to the confidential offering memorandum. Charles River is charging a 2.25 percent management fee and keeps 30 percent of the profits. The losses are yours. It's a great business, venture capital. . . .

Neighborhood news: Old friend Christopher Lydon is starting a new conversation. You can be part of it at www.bopnews.com.

Steve Bailey is a Globe columnist. He can be reached at 617-929-2902 or at bailey@globe.com.

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