BlueArc Pulls In $15M More

BlueArc Corp. made it official today: Its VCs have kicked in another $15 million in funding, raising its total to $175 million as it chases profitability.

As reported in Byte and Switch last week, the round came from existing investors (see BlueArc Branches Out). Meritech Capital Partners and Crosslink Capital led the way and all nine of the NAS vendors previous VCs participated.

The funding was no surprise, but the question remains: When will BlueArc turn a profit? Why does a company that's been generating revenue for nearly four years, growing steadily, and grabbing $160 million in funding since 1998 need $15 million more?

According to CEO Mike Gustafson, the problem isn't lack of sales. He claims BlueArc doubled revenue last year and increased its customer roster by 60 percent. “BlueArc’s had a great year,” he says. “We’re going to have a record quarter this quarter. We are well funded. [Ed. note: No kidding!] I know there are a lot of rumors out in the market place, and questions about what it’s going to take for us to be profitable.”

Those rumors say BlueArc needs the extra funding to stay around long enough to turn a profit so the VCs can sell the company and get a return on investment.