Mimosa Munches $17M

Archiving startup clinches mezzanine funding and looks overseas

May 19, 2008

3 Min Read
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Archiving specialist Mimosa has scored $17 million in funding to expand its global presence and overhaul its NearPoint software.

The round, which was led by Focus Ventures, also included August Capital, Clearstone Venture Partners, and Mayfield Fund. It brings Mimosas total funding to $51.5 million.

“We’re using this money primarily for global expansion,” says T.M. Ravi, the Mimosa CEO, explaining that the vendor will be targeting the U.K., Germany, China, Australia, and Japan. “It’s to add sales, pre-sales support, and professional services staff in all regions.”

As part of this effort, Mimosa will add up to 45 employees to its 185-strong workforce by the end of the year, according to the CEO.

The vendor is also planning to open up its NearPoint offering to third-party applications later this year. By opening up the software’s APIs, T.M. Ravi expects to boost the product’s ediscovery capabilities.“There’s literally 50 to 75 product and services vendors in ediscovery,” he says, explaining that this ranges from content analysis to legal case management. The exec would not reveal which vendors will be part of this effort, although potential candidates could include the likes of Kazeon, which recently introduced software for early case and risk assessment.

“We plan to make an announcement at the end of June,” says the CEO, adding that Mimosa has other product enhancements planned for the fall timeframe. “We want to go after a broader market around user-based content and content from collaboration tools.”

This seems likely to mean support for Microsoft SharePoint, something which has been a notable gap in Mimosa's arsenal.

NearPoint started life as a Microsoft Exchange product, although the vendor has added Instant Messaging, file archiving, and some support for Lotus Notes, which will be enhanced later this year. Rivals Symantec and Zantaz, in contrast, also support SharePoint.

The Mimosa CEO told Byte and Switch that, despite its current lack of SharePoint support, the vendor has managed to rack up over 470 customers, 233 of whom were added in 2007.One of these customers, Frank McGurk, IT coordinator at Wilmington, Delaware-based accounting firm Siegfried Group says that, more than Sharepoint, he would like to see Mimosa flesh out its mobile messaging story.

"If there's integration with BlackBerrys, that would be useful," he explains. "It's our leadership team and our sales team that mainly rely on them -- they are joined at the hip with their blackBerrys."

Mimosa’s T.M. Ravi denies the suggestion that this week’s funding round was born out of desperation, explaining that the vendor is in no way struggling for money.

“We’re generating cash -- huge amounts,” he says, adding that he is even eyeing a possible public offering, although this will not be anytime soon. “We’re driving towards an IPO -- it’s hard to say, but [maybe] 2010.”

Whether this happens of not, one thing is for certain: the email archiving market is on an upswing.Analyst firm IDC estimates that the applications archiving market grew 45 percent over the last year, largely driven by storage and ediscovery requirements. Analysts estimate that the total market for archiving and ediscovery will be worth more than $2 billion by 2011.

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  • August Capital

  • Clearstone Venture Partners

  • Focus Ventures

  • IDC

  • Kazeon Systems Inc.

  • Microsoft Corp. (Nasdaq: MSFT)

  • Mimosa Systems Inc.

  • Symantec Corp. (Nasdaq: SYMC)

  • Zantaz Inc.

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