Softricity Scores $14.6 Million
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Softricity Inc., an application deployment and management platform provider, announced today that it has completed a $14.6 million third round of venture funding, bringing its total funding to date to $40 million.
Boston-based Softricity reports that the funding round was oversubscribed. "There was more money on the table our than maximum target," said Harry Ruda CEO of Softricity. Ruda told ASPnews that the funding "may grow to as much as $17.5 million; we left some room for inside investors."
Softricity's SoftGrid 2.0 technology streams small portions of application code to destination computers, which can be a Windows desktop or a terminal server. When a client makes a request for that application, only the portion of code that is necessary to get up and running is sent to the machine and executes locally.
Raising what will most likely be Softricity's last round of venture capitial was not an easy task given the current economic climate. "I've been involved with lot of venture funding and this was by far the most difficult," Ruda told ASPnews.
The two partners are playing different roles with Softricity, Ruda said. "Microsoft is a long-term, strategic partner. However, most of our current business comes from Citrix partners."
Ruda said most of the capital will be used to build an infrastructure for the sales channel. "Half the battle is building the field support, training and custom support personnel." The company will continue to work primarily with Citrix value-added resellers (VARs), Ruda told ASPnews. "We have most of Citrix' Gold and Platinum VARs. We are very specific and very strict about the VARs we work with."
Softricity currently has about 50 employees. "The low was around 40 and we'll probably end up at about 60," Ruda said. He added that he expects Softricity to reach cash-flow breakeven and profitability next year. "We don't expect to need a fourth round of funding. We are going to be conservative with our cash. We are not going to blow the wad."
Softricity's multi-year strategic alliance with Microsoft involves joint development and sales and marketing initiatives designed to turn current and future Windows applications into .NET-managed Web services. "Softricity is a great example of partners realizing improved business agility with .NET," said Sanjay Parthasarathy, vice president of the U.S. .NET Platform Strategy Group at Microsoft.
New investors TD Capital Technology Ventures and FA Technology Ventures led the round, joined by Hunt Ventures and Markpoint Venture Partners. Previous investors Prism Venture Partners, Longworth Venture Partners and Technology Link Capital also participated in the funding.
Softricity also announced today that Paul Ciriello, managing director at TD Capital, and Greg Hulecki, senior partner at FA Technology Ventures, have joined Softricity's board of directors. Scott Segell of Hunt Ventures has joined as a board observer.
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