Intel Leads $17 Million Financing of Maginatics
The Mountain View, California-based company said today it raised $17 million in a funding round led by Intel’s venture arm, with participation from Comcast Ventures and China’s WestSummit Capital. Existing investors -- EMC Corp. (EMC)’s venture unit, VMware Inc. (VMW) and Atlantic Bridge -- also contributed.
Maginatics, founded in 2010, is competing in an increasingly crowded storage market as large businesses seek new solutions to handle the archiving and backup of surging amounts of data while letting employees access and collaborate on documents from a multitude of devices. Rather than only selling directly to information-technology departments, Maginatics is bringing in investors that can also serve as business partners to help get the product into customers’ hands.
“Being a startup and going to financial companies, semiconductor companies and media companies, it helps with credibility,” said Amarjit Gill, co-founder and chief executive officer of Maginatics. Without big partners, “we would have to work much harder to get this in the market.”
Gill, who previously sold companies he co-founded to Google Inc., Apple Inc. and Broadcom Corp., declined to comment on the valuation. Maginatics has raised $27 million including an earlier funding round.
The company will use the additional capital to bolster its marketing, sales and business development, Gill said. The company will expand to 60 to 65 employees in the next 12 months, from about 40 now, he said.
Venture capitalists have been flocking to storage in the past two years. Nimble Storage Inc., which provides high-speed systems for data centers, raised $40.7 million in September from investors including Sequoia Capital and Accel Partners. Cloud-storage provider Egnyte Inc. raised $16 million in July 2012 from a group led by Google’s venture arm, and Ethernet storage company Coraid Inc. reeled in $50 million in late 2011 from Crosslink Capital and other investors.
In some cases, Maginatics is competing with file-storage providers Box Inc. and Dropbox Inc., though unlike those services, it doesn’t have a consumer offering. Maginatics’s software, MagFS, is downloaded on computers and mobile devices, automatically storing documents and files and letting co-workers collaborate.
“MagFS enables this transition by helping companies serve highly-distributed operations and seamlessly migrate workloads to the cloud,” Lisa Lambert, vice president of Intel Capital, said in a statement today.
While the company declined to disclose its revenue, the average client pays tens of thousands of dollars a year, according to Bruno Raimondo, head of product at Maginatics.
Intel, the world’s largest semiconductor maker, rose 1.1 percent to $22.52 at the close today in New York. The stock has gained 9.2 percent this year.
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