Wednesday, October 12, 2011

Black Duck lines nest with $12M in new funding

By Rodney H. Brown

Article updated as of 11:10 a.m., Oct. 13, 2011.

It has been three years since Black Duck Software last raised any capital, but the company has now taken in $12 million in a new funding round that a company official referred to as a "pre-IPO round."

The latest financing brought on new investor Split Rock Partners, along with return backers General Catalyst Partners, Volition Capital (formerly Fidelity Ventures), Flagship Ventures, Focus Ventures, Intel Capital, SAP Ventures and Red Hat.

"It's not like we were desperate for money," said Peter Vescuso, executive vice president of marketing and business development. "We're looking to accelerate beyond the growth we’ve been realizing. We’ve been growing at this rate for nearly three years.”

Black Duck noted in a news release that its year-over-year sales have grown at more than 35 percent. With the proceeds of the $12 million round in hand, the company plans to accelerate project development, expand global sales and marketing, and apply the funds to more acquisitions.

Black Duck went on a buying spree that started in 2010 with the January acquisition of The Olliance Group LLC, a California-based consulting form that specializes in open source software for an undisclosed amount.  Previously, in November, Black Duck bought for an undisclosed amount SpikeSource, a software developer in the field of security vulnerability and application component identification. That gave Black Duck SpikeForge, Developer Community Forum and SpikeInsight, the company’s cloud-based tool for assessing security vulnerability and automating application component identification.

In October, Black Duck spent nearly $3 million to purchase pen-source online resource Ohloh.net. Black Duck added to Ohloh with some of its paid product, the Black Duck KnowledgeBase, a repository of information about open-source projects and software.

With this latest round, Black Duck has raised at least $37 million over four funding rounds since it was founded inn 2003 by Doug Levin, who in July was named to the Massachusetts Technology Development Council (MTDC) board of directors.