Westford Firm The Darling Of VC Investors
James Dolce, CEO of Verivue Inc. of Westford.
In an economy where capital is hard to find, Westford-based Verivue Inc. finds itself in an enviable position.
That's because the company, which produces technology that helps network operators manage Internet video data, recently received $20.1 million in equity financing. The latest round of funding brings the total the company has received from venture capital investors to $85 million.
Investors in the start-up include Comcast Interactive Capital, Matrix Partners, North Bridge Venture Partners, Accel Partners, Arris Group Inc. and Sigma Partners.
Stream Enabler
The company's technology has combined an Ethernet network switch and Flash-based storage into one device. The products are aimed at cable companies, broadband providers and cell phone companies.
"By integrating storage with network switches, they're enabling these operators to be much more efficient in delivering video," said John Coulbourn, a Verviue spokesman and managing partner at Topsfield-based Ipswich River Media.
Its system can stream a lot of videos at the same time, more than 50,000 per server, and by using Flash storage technology, it can be packaged into a smaller system that goes in a data center, Coulbourn said. Flash storage technology is important because it uses less electricity and is more reliable, he said. The system distributes the videos to different types of devices, including televisions, cell phones and computers.
Verivue's investors are obviously bullish on the company's technology, and they were happy to show their confidence by putting $20 million of additional capital into the company - without Verivue actively soliciting the money.
Investors that are willing to offer funding in the current environment is noteworthy, according to Alan Breznick, a senior analyst with Heavy Reading, a telecom technology market research firm based in New York City.
"I think it's pretty rare," he said. "It's pretty special given the economic times."
While a willingness by Comcast's investment arm to invest in Verivue does not ensure that the telecommunications giant will deploy the technology, it's still a good sign, Breznick said.
Investor confidence is not due to the technology alone.
It's also generated from the team of serial entrepreneurs that are running the company.
The top two leaders are CEO James Dolce, a founder who was previously with Juniper Networks of Sunnyvale, Calif., and Vice President of Business Development Rubin Gruber, who came from Sonus Networks of Westford. Both men have founded a number of companies over the years in the video and networking industries. Most of the rest of the management team comes from Juniper or Sonus.
Verivue has also inked partnerships with one of its investors, Arris Group Inc., which is integrating the Westford company's video switches into its digital video equipment. Arris Group is the third-largest player in the cable television video equipment market, Breznick said.
It also signed a similar deal with eventIS Group BV, which was just acquired by Acton-based SeaChange International Inc. for $36.6 million.
"It's so early for this market that it's hard to say who the market leader is," Breznick said. "But they're in a good position."
WBJ Web Partners
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