Exeros Plans Expansion

Software startup Exeros, which is touting a new approach to handling structured data, has clinched $12 million in a Series B funding round in an attempt to extend its business across the U.S.(See Exeros Secures $12M .)

The round, led by AllianceBernstein, also included Bay Partners and Globespan Capital Partners. It brings Exeros's total funding to $19 million since it was founded in 2002.

Exeros offers a software tool that finds the relationships between data in disparate databases. The vendor, which is up against IBM and Trillion in the "data discovery" space, is now looking to double its 40-strong workforce by mid-2007, largely in engineering and sales. "A lot of getting your name out there is getting feet on the street," explains Todd Goldman, Exeros vice president of marketing.

The startup, which does the bulk of its business in New York and the northeastern U.S., is also planning to extend its presence across North America and plans worldwide expansion next year. Goldman says Exeros currently has "dozens" of customers, largely in the financial services and healthcare sectors, although they do not want their identities revealed. "In some cases they are using [our software] to find sensitive data in their company," he explains.

Exeros's flagship product is DataMapper, a software tool that checks the relationship between different datasets on various databases and spreadsheets. According to Goldman, DataMapper identifies the hidden” relationships between data such as linking sets of social security numbers or telephone numbers held on different databases. The software, he adds, can even find social security numbers that are stored within larger lines of code.A number of vendors, such as IBM and Trillion, currently check metadata to work out the relationships between different pieces of data, although Philip Howard, research director at Bloor Research, told Byte and Switch that this approach is limited. "You don't have all the information if you use a metadata-based approach," he explains.

Because metadata only provides a summary of the overall data, Howard feels that it is more difficult to work out the relationship between specific items of information. Exeros, on the other hand, uses a patent-pending algorithm to check the data row by row.

"There are lots of relationships hidden away in the data that may not be apparent [when just checking metadata]," says Howard, adding that he is not aware of any other vendor taking the same approach as Exeros.

IBM, for its part, has developed its Unstructured Information Management Architecture (UIMA) to work out the relationship between different pieces of data, although this is not a direct competitor to DataMapper, which deals only with structured data.

Based in Santa Clara, Calif., Exeros was set up by Piyush Gupta and Alex Gorelick. Gupta was the man behind procurement software firm Promeria, which was sold to Airba for an undisclosed fee in 2004. Gorelick was the co-founder of data extraction software firm Acta Technology, which was bought by Business Objects for $65 million in 2002. Gupta now serves as Exeros CEO while Gorelick is the startup's CTO.Exeros has already announced a partnership with data integration specialist Informatica, and Goldman says that others will follow, thanks, in part, to the recent cash influx. "There are at least five [companies] that we're talking to, and they are all well known names," he claims.

Howard feels that the company could also make prime acquisition bait for the likes of IBM, Trillion, SAP, or even Oracle, as the firms look to fill in the gaps in their data discovery story. "Potentially they could [get acquired], but it's still early days for them," he notes.

But it is not all plain sailing for Exeros. The firm's technology is essentially a sophisticated set of tools, according to Michael Dortch, principal business analyst at the Robert Frances Group, something that users may find off-putting. "I am sure that there are some enterprises that look at the Exeros solution and say that looks like more than we need," he warns, adding that it can be deployed one piece at a time.

Another potential challenge for users, however, could be the amount of customization needed to get the tools up and running on multiple systems, which could mean bringing Exeros in as a professional services specialist.

The startup also faces a tough job forcing execs to relinquish control of their data. "There are a lot of enterprises that are still populated by people who believe that the data they are using everyday belongs solely to them," explains Dortch. "The biggest challenges that Exeros faces in the user community are political and cultural."— James Rogers, Senior Editor, Byte and Switch