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02/08/2005
Trail of Tears: A List of $90M+ VC Software Financings
As I mentioned in my last post, after Webroot announced their $108M round of financing, I tried to find all of the VC investment rounds in history that have been at least $90M or more. The three that I found on VentureSource indicate that the track record for $90M+ VC rounds into Software companies is more like a trail of tears. All three of the companies I identified have either gone out of business or have been merged/acquired after they have become shadows of their former selves. The three deals I identified include:
Asera: Raised the granddady of all software related VC rounds of $115M in August of 2000. Kind of the swan song of the late 90's bubble. When I was working for Softbank's late stage fund I actually met with Ascera for that round of funding, but passed because I couldn't figure out what market they were in or what their software actually did. Apparently no else could either as Asera was eventually sold for scrap in early 2003.
Buildnet: Raised $107M in December 2000. Buildnet was a combination construction management software and building industry exchange, so it really wasn't a pure software play, but it's close enough. Buildnet filed for Chapter 11 less than 1 year after taking in its $107M.
Zaplet: Raised $90M in October of 2000. Zaplet had a product that enabled rich-email, which was basically, as far as I could tell, HTML e-mail hooked up to a database. Zaplet was merged with MetricStream in early 2004. From what I hear, the most attractive thing about Zaplet was that it still had some cash left over from 2000.
VentureSource also listed Centrepath as a software company that raised more than $100M+ in one round, but it appears that they are more of a network systems management/consulting firm (or at least this is what they become). I also remember that Loudcloud raised $120M , but they were a hosting firm at that point (they are now a software company called Opsware).
If this list is accurate, that would make the Webroot financing the 2nd largest software VC financing in history. Let's hope it turns out better than the other mega-deals did.
P.S. If anyone knows of any $90M+ VC software financing deals I missed, post a comment.
UPDATE: Based on people's comments, I have a couple more companies to add. Remember I am looking for pure software companies that raised over $90M+ in a single round of financing:
Brience: A wireless software company that was launched in 4/00 with an initial $200M investment/committment from GTCR. Brience was acquired for what looks like less than $10M in 2003 by Syniverse, another GTCR funded company. Based on the SEC financials filed by Syniverse, it looks like Brience really only received about $78M in investment and this was spread out over several rounds of funding, however someone in my comments swears this is not the case and even if it is they deserve to be listed just for the shear audcacity of claiming a $200M up front investment.
PacketVideo: Another wireless software company, this one supposedly focused on streaming 3G video to phones. Closed a $100M round in 2/01. Have not heard much from them since other the sale of one of their "divisions" to Acatel in 2003. From the website they look like they are still healthly. I wonder how much of their $100M is in the bank still? (Thank to Jeff for pointing this one out.)
There were a few others mentioned in comments which I am not putting on the list including 12 Entrepenuering (incubator fund, not a software company), PayPal (financial serivces/internet, not software), and AllAdvantage (Internet). In fact the list of Internet deals that received $100M+ in funding is long and mostly undistinguished.
February 8, 2005 in Venture Capital | Permalink
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