Hardware veteran Lee Chen's (pictured) reliable habit of forming a new company every few years and selling it after successfully grabbing market share continues apace, with little time out spent worrying about financing.
After successfully passing on Centillion Networks to Bay Networks in a trade sale and turning Foundry Networks over to the public markets, Chen's current startup, A10 Networks, just landed $23 million in a Series C funding round largely from strategic investors that have been with the company from the beginning. A10 took in about $2 million from Taiwan's China Investment & Development Corp. in the new round, but did not spend any time recruiting other investors, with previous investors Mitsui & Co. Ltd. of Japan, Triton Ventures of Taiwan, H&Q/Asia Pacific of Palo Alto, Calif., Taiwan's Harbinger Venture Management and Singapore-based Enspire Capital happily putting a valuation of nearly $95 million on the company.
Chen said A10 raised the money to continue rapid sales growth in an industry with long sales cycles, but he added that deals already in the works will likely make the company profitable within a year on sales he expects will more than quadruple in 2008. The company's proprietary architecture and software run on appliances built with off-the-shelf components, and augment tradional load balancing technology with elements of cloud computing and distribution technology to improve web applications delivery for carriers and service providers. Chen said global sales growth from bandwidth-heavy customers had investors eager to put more money into the company.
"It was pretty much an insider's round from the beginning, because we had good traction and wanted to concentrate more on increasing the size of the pie than taking the time to bring in new investors," said Chen, who founded the company in 2004. -- Clifford Carlsen
See July 14 press release from A10 Networks Inc.
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