Storage and data recovery service provider GlassHouse Technologies has been steadily expanding since its founding in August of 2001. Its customers include Biogen, Hartz Mountain Industries and Pitney-Bowes.
And since December of last year, the Framingham, Mass.-based company has opened offices in Durham, N.C., Minneapolis, Minn., New York and Santa Clara, Calif.
It also became profitable in the third quarter of this year.
Now the company wants to be ready to expand again, including going overseas and has thus raised a $7.1 million Series C round of funding to do it.
“We really hadn’t decided to look for money yet,” says president and chief executive officer Mark Shirman. “We get a lot of visits from VC guys who keep track of us. All of a sudden people started getting really serious and didn’t say no.”
Kodiak Venture Partners led the round with $4 million. The Series C was an up round with a post-money valuation of $26.1 million. The round brings the total funding raised by GlassHouse to $15 million. Previous investors that also participated in this round include Globespan Capital Partners (formerly Jafco Ventures), GrandBanks Capital and Sigma Partners. Other previous investors include individuals and Shiprock.
Chris Greendale, a Kodiak venture partner who was one of the company’s initial individual investors, says that the round was done to give the company the ability to grow by acquisition in the future.
“The Series C round is really to create dry powder for growth purposes,” says Greendale, who has sat on the company’s board since it was founded. Greendale first joined the board as a representative of GrandBanks but has since switched firms and represents Kodiak.
GrandBanks appointed Ryan Moore as its representative. Also, Globespan’s board observer is now a full member.
Greendale says that the company’s biggest challenge over the next year will be managing growth.
“They’re really moving to that next stage, they have to put in place the system and processes that will allow them to do that,” he says. “This is a very good problem to have.”
According to both Shirman and Greendale, GlassHouse will not need to raise another round of funding unless it saw an acquisition it felt compelled to make.
“It’s unlikely we’d do a Series D unless of course we had an acquisition that we found likely and it required cash,” Greendale says.
The company plans to acquire service and consulting companies in various regional markets.
This past June, GlassHouse announced it acquired the services and support business of Germany’s Auspex Systems for $270,000 in what Shirman describes as a great deal. GlassHouse has between 85 and 90 employees currently and expects to double the staff in a year. GlassHouse was founded in 2001.
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