Startups waiting longer to raise Series A

Certainly starting an Internet company is a lot cheaper than it used to be. And clearly entrepreneurs would prefer to hold on to as much equity as they can.

But perhaps there are other drivers behind what might be called a recent mini-trend: Rather mature companies in a variety of sectors are raising their first venture financing rounds.

The biggest example of such deal was last week’s announcement by Atlassian, a Sydney, Australia-based maker of software development tools, that it has raised $60 million from Accel Partners for a minority equity position. Accel Partner Rich Wong has joined the board. The deal, according to Atlassian, marks Accel’s largest investment ever in a software company.

Yet Atlassian certainly took its time taking the money. The company was launched in 2002 by entrepreneurs Mike Cannon-Brookes and Scott Farquhar, with a startup budget of $10,000 on credit cards. It’s apparently been profitable since shortly after inception and sought after by venture capitalists for years. Currently, Atlassian says it has 225 employees, and growing, and some 20,000 enterprise customers.

Why take the money now? Mostly it’s the usual reason—a desire to scale even bigger heights.

Cannon-Brookes blogged that “Accel has a long track record of helping companies break out.” But Accel also wooed the startup with a display of corporate culture solidarity. One of Atlassian’s oft-repeated value statements is “Don’t Fuck the Customer,” or DFTC. Accel printed their own T-shirts stating their partnership’s #1 value: DFTPC (”Don’t Fuck the Portfolio Company”).

Atlassian is one of several companies that’s been around a while before raising a Series A round this past year. Others include:

Gigamon, a 6-year-old maker of switches for network monitoring, raised its first round of $22.8 million in late January from Highland Capital Partners. Ted Ho, CEO of the Milpitas, Calif.-based company, says the founders tried raising capital in 2004, but was shot down. They chipped in their own money, built a product, and in 2005 brought in $1.5 million in revenue. Sales grew 550% the next year, and have been about 60% year-over-year since then, Ho says.

Adura Technologies, a developer of wireless lighting management systems for offices and other commercial facilities, has raised $17 million from Claremont Creek Ventures, NGEN Partners and VantagePoint Venture Partners in the past two years, including $12 million in February. The San Francisco-based company was founded in 2004.

Gamma Medica-Ideas, a Northridge, Calif.-based developer of digital molecular imaging systems, closed a $24 million financing round in September, roughly 10 years after it was founded. The financing included $14 million in equity capital, led by Psilos Group, and $10 million in debt financing. —Joanna Glasner