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Netilla & AEP: Hands Across the Ocean: Page 2 of 3

This is important, according to Oltsik, because users are sick of dealing with a wide range of vendors. “Everyone is looking for fewer vendors and this lets AEP and Netilla sell more [products] at one time."

But it’s a tough market out there, and the newly merged firm will be coming up against the likes of Aventail Corp., F5 Networks Inc. (Nasdaq: FFIV), Juniper Networks Inc. (Nasdaq: JNPR),

SafeNet Inc. (Nasdaq:
SFNT), and Thales SA (Paris: HO).

Undeterred by all this competition, Best predicts the new company will be profitable sometime next year. He also tells NDCF that AEP Networks, like Netilla, will conduct most of its business through the channel. “It saves us money and it allows us and our channel partners to provide local sales and support to our customers,” he says.

The $5 million funding round involved prior investors in both companies, including AEP Systems’ lead investor ACT Venture Capital and Netilla’s lead investor Ascend Venture Group. Other firms participating include Early Stage Enterprises, Masthead Venture Partners Corp., Mid-Atlantic Venture Funds, and NJTC Venture Fund.

Prior to this funding round, Netilla had raised about $20 million since its launch in 1999. AEP Systems, which was founded a year earlier, had secured a similar amount.