Financing Winners Like NewsGator

Last week NewsGator announced that it had raised a $12m round led by new investor Vista Ventures and existing investors Mobius Venture Capital and Masthead.  Greg Reinacker – NewsGator’s founder / CTO reflected on the progress from the first $1m investment that Mobius made and Jeff Nolan’s talked about our excitement of getting Lisa Reeves (formerly from SAP Ventures – now at Vista) involved.

I’ve been an investor (via Mobius Venture Capital) from the very beginning of NewsGator.  I wrote a post titled Why Did We Invest in NewsGator? in June 2004 shortly after making a $1m seed investment in the company (mostly in Greg Reinacker and his vision.)  Reading back through it makes me feel simultaneously nostalgic and intensely proud of what the now 75+ people at NewsGator have accomplished.

NewsGator has a variety of products built on top of the RSS platform technology they have created.  We’ve seen great adoption of the NewsGator Enterprise Server (over 100 of the Fortune 2000 are now customers), are seeing rapid growth in our new NewsGator Social Sites product (integration of NewsGator Enterprise Server with Microsoft SharePoint Server 2007), and have been blown away by the market success of the NewsGator Widget Framework (over 50 customers added in 2007.)

We took a "go heavy on building the technology" approach at NewsGator and it has paid off nicely.  The expertise within the company around RSS technology is humongous.  We’ve started (but have not limited ourselves to) a Microsoft view of the enterprise and as a result have extremely deep links into SharePoint, Exchange, and Active Directory (along with some of the best Microsoft .NET developers on the front range.)  And we’ve been able to attract incredible product talent to the team which has resulted in an awesome portfolio of integrated products on various platforms including Windows (FeedDemon), the Mac (NetNewsWire), Outlook, and Mobile (name a platform, we’ve got it.)

Lisa Reeves – who comes from the world of enterprise software – understands the potential of a company like NewsGator.  In a universe where many VCs are saying things like "we are only interested in consumer Internet" or "we only want to fund companies with a pure SaaS model", Lisa saw past the nonsense of such limiting thinking and focused on the potential of the overall business.

As a huge believer that the consumer Internet innovations that we’ve seen take front and center stage over the past few years are now ripe for application to the enterprise, I’m rabidly excited about the prospects for NewsGator.