Hoping to combine old-fashioned manpower with new-fangled technology to help enterprises manage mountains of information, content management software provider Quiver Inc. recently closed the first tranche of its Series C offering with $5 million.
The round is being kept open for a few more weeks to accommodate some additional investors who are expected to pump another $500,000 to $1 million into the deal.
So far, all of the round’s participants are repeat investors, most of which substantially upped their commitments this time, says Scott Potter, Quiver’s chief executive.
El Dorado Ventures signed on during the round’s first tranche, as did Hummer Winblad Venture Partners, Partech International and LMS Capital, a subsidiary of London Merchant Securities Plc. The transaction technically has no lead, Potter says, as all of the investors put up approximately the same amount of capital and all were involved in setting the terms.
This will likely be the company’s last foray into the private equity market, as it expects its latest capital infusion to last until it reaches cash flow positive in 2003. After that, Quiver may entertain a possible initial public offering if the market conditions are ripe, Potter said.
Info, Info Everywhere
In its barest bones iteration, Quiver provides software applications to enterprises that enable them to build taxonomies, or topic-based data structures. Like Yahoo!, which organizes Internet content into thousands of information topics, Quiver’s software enables companies to categorically organize their data and other intellectual assets.
Traditionally, companies have hired teams of knowledge workers or librarians to manually categorize their huge stores of information. “While this is usually very accurate, it’s not very efficient,” Potter says.
On the flip side, other companies have used purely automated solutions, which use algorithms to organize the data by topic.
Quiver falls right in the middle. “Academic research shows that the purely automated solutions are only about 60% to 70% accurate,” Potter explained. “Quiver’s solution uses auto-categorization and algorithms to front load the organization process, then the corporate information managers take it to the next level.”
By adding a human element that can oversee and provide a sort of check-and-balance system for the automated solution, Quiver contends its product can provide 100% accuracy while cutting the information managers’ work time in half.
“It allows two or three information managers to do the work of 20 or 30,” Potter says.
Quiver’s chosen space isn’t entirely new; therefore, it has a handful of competitors in both the public and private arenas. Its publicly traded peers include Autonomy Inc. and Verity Inc., but it also rubs competitive elbows with such privately held players as Semio and Stratify, which earlier this month completed a round of venture financing led by In-Q-Tel, the CIA’s VC arm.
Despite the stiff competition, Quiver has already managed to sign on several customers. Potter declined to name them, however, saying only that the company is planning to make a slew of new client announcements within the next few weeks.
Robyn Kurdek can be contacted at Robyn.Kurdek@tfn.com