Friday, September 12, 2008

Akorri adds $5M to boost sales staff

By Christopher Calnan

A year after shifting its focus to the virtualization market, data storage software maker Akorri Networks Inc. has closed a $5 million add-on round of financing to hire additional salespeople for the company’s expanding sales channel, CEO Thomas Joyce said.

The funding is a supplement to a $15 million Series C financing Akorri completed last year to position itself for an initial public offering. But Joyce, who joined the company in late 2007, said an IPO is now a couple of years off and not a factor in the recent funding.

Akorri, founded in 2005, initially developed conventional storage software. But last year it shifted its focus to software (called BalancePoint) designed to manage virtualized data centers. It now generates 95 percent of its business from customers of VMware Inc. (NYSE: VMW), a California-based spinoff of Hopkinton’s EMC Corp. (NYSE: EMC), Joyce said.

Akorri created the partnership agreement with VMware before the company broke off from EMC and subsequently completed an initial public offering in August 2007. Akorri has a similar deal with VMware rival Citrix Systems Inc. (Nasdaq: CTXS), a Florida-based company that operates an office in Bedford.

The adoption of virtualization is still in its early stages, with just 6 percent to 10 percent of enterprise servers having been virtualized, said Bob Laliberte of Milford-based Enterprise Strategy Group, who noted that means plenty of companies will be looking for help virtualizing servers in coming years.

The recent financing increased the total venture capital raised by Akorri to $43.5 million. Investors included Matrix Partners and North Bridge Venture Partners, both in Waltham; Bluestream Ventures, a Minnesota venture capital firm; and Globespan Capital Partners, a Boston firm.