DAG Ventures continued its practice of following tried and true blue-chip predecessors in funding RingCentral, a developer of hosted virtual phone systems for small business. The firm is leading a $12 million second round to top off a Series A investment from Sequoia Capital and Khosla Ventures.
DAG's tendency to only invest in fundings initiated by Sequoia, Kleiner Perkins Caulfied & Byers or Accel Partners lately has put a lot of attention on the high-profile deals and pioneering roles the firms are playing in media and cleantech. But the RingCentral investment shines a light on their more prosaic sides, demonstrating that even the hottest investors still have time for bread-and-butter deals to provide technology advantages at the margins.
RingCentral plays in the overlapping sectors of Web 2.0, telephony and the tide of hosted software dominating in small-business applications. The company's software-as-a-service offerings help small businesses navigate the world of telecom hardware and VoIP services in a scalable manner to benefit even the smallest of users.
Investors are characterizing the company's business as a recession-resistant service that puts the operational efficiencies of the Internet to work on everyday services, with a focus on the home business/small-business market, an area that has been underserved by venture investment focused on more glamorous markets. - Clifford Carlsen
See March 4 press release from RingCentral
See Feb. 25 post from Tech Confidential
See November 2007 post from Tech Confidential
See September 2007 post from Tech Confidential
For more see TMCnet, The Wall Street Journal and The Industry Standard
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