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GroupSpark Opens Hosted Exchange

When Ravi Agarwal founded GroupSpark in 2002, hosted Microsoft Exchange services were scarce -- and out of reach for most small businesses. It wasn't just that the typical cost of $30 to $50 per seat was a bit rich. The option to host wasn't something an SMB's typical IT provider (the local VAR or integrator) even knew about -- let alone could offer.

Four years later, GroupSpark CEO Agarwal is convinced 2007 will be the year of Hosted Exchange, as services have hit the $10 to $15 per seat range. And he's convinced the main purveyors will be the local VARs, integrators, and resellers SMBs rely on most.

"There are 25 million to 30 million SMBs in the U.S.," Agarwal says. "The reseller is the only way to efficiently reach SMBs."

So far, GroupSpark has "reached" over 700 resellers, Agarwal claims. Not bad for a 20-person firm. And with two years' profitability under its belt, GroupSpark has justified Agarwal's personal investment -- the only foundation capital the company's taken so far.

How well is the startup doing? "In 2006, we grew our customer base 250 percent and our number of mailboxes sold 300 percent," Agarwal boasts.

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