Business intelligence software maker Razorsight Corp. returned to sole institutional investor Sierra Ventures for
$9 million, on top of $10 million the firm fronted the company in a Series A
round
in January 2005. The startup will use the new money to expand its suite of
products for communications, entertainment and media companies and to
spur international expansion.
Seven-year-old Razorsight landed Verizon and AT&T Corp. as early
users of its data mining software. The company has focused on helping
telecommunications carriers monitor cost data and automate analytical
processes in business functions including network engineering and market,
product and customer profitability analysis. In announcing the new funding, RazorSight also mentioned landing two major European
carriers and said it
will boost strategic partnership development.
Razorsight said it was profitabile at the time of the company's initial venture
investment. It has has grown 2,500 % over the last five years,
and the need for new capital and the fact that existing investors
stepped up demonstrates the nature of software-as-a-service businesses.
Fast growth creates a need to scale up quickly, but SAAS companies
don't have the large up-front licensing fees traditional software
companies have relied on to match growth. On the other hand, the
recurring revenue model provides investors a pretty reliable view of a
company's path to profitability, making it less likely they will want to
dilute postions in fast growing companies with additional investors.
-- Clifford Carlsen
See May 19 press release on new funding from Razorsight Inc.
See January 2005 story from TheDeal.com
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