Savantis Gets Power Surge With $12M

Just like it doesn’t make sense to have hundreds of power generators in your house, it doesn’t make sense to have hundreds of database servers in the same office. Apparently, Sigma Partners agrees with that theory. Today Sigma is expected to announce it led a $12 millioin Series B deal in Savantis Systems Inc.

“Database server consolidation is garnering a lot of attention,” says Gil Hecht, CEO of Savantis. “A long time ago when people needed electricity, they would go to the power generator. Today with the microwave and everything else, one family would need 50 people to maintain 400 generators. Now a whole lot of people just use one and they pay less. The same thing has happened with phone lines and storage networks. We are doing it for databases.”

Enterprise data centers bring new applications online everyday and they require reliable database services. Therefore, data centers are forced to dedicate at least one database server to each new application. These servers are very expensive, over provisioned, under-utilized, and extremely complex to manage. Savantis claims it will be able to respond to these needs its solution.

The Lexington, Mass.-based company’s Series A investors – Highland Capital and Star Ventures – also participated in the round. Bob Davoli, a managing director with Sigma, which put up about half the round, joined Savantis’ board of directors as a result of the round.

Approximately 10 customers are trying Savantis’ product, but the company will formally launch its solution in March. “It was important to us to have data so we are testing the product, but revenue is in the pipeline. And profitability is expected in the next few years,” says Hecht, who described the company’s post-money valuation as very good. “We raised money because the product is not filling an immediate need right now, but it is really something enterprises need.”

The capital is expected to be used on product development, sales, and marketing efforts. Savantis has 30 employees, but expects to grow that number throughout the year.

Moreover, Savantis is not planning on looking for another round of venture funding. “At this point we are very pleased with how the round went off and our main focus is getting the product out the door. We want to become a viable business as soon as possible. We need to make some sales and bring in some profits,” says Hecht.

To date, Savantis has raised more than $17 million. Founded in October 2000 by Hecht – who was a CEO-in-Residence with Star – the company raised an undisclosed amount of seed capital from Star. Then in October 2001, Savantis brought in $5 million from Highland and Star.

While the Hecht seems sure that his company won’t be coming back to the venture capital circle, he is less sure of an exit strategy. “If we have a strong business then we will be open to anything,” says Hecht. “If you have a real business the exit is not an issue. If your company is not viable then there will never be an exit available.”

Email Danielle Fugazy