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Start-up gains Netscape funding, Microsoft engineers

A small fortune in Netscape money is combining with a small army of Microsoft veterans to create Crossgain, a start-up geared for commercial Web application developers.

In what may be the "Odd Couple" of Internet technology, a small fortune in Netscape Communications money is combining with a small army of Microsoft veterans to create a start-up geared for commercial Web application developers.

Boasting a staff heavy with Microsoft engineering and developer relations experience, Redmond, Wash., start-up Crossgain plans to build software for serving and creating Web applications. The company plans to rely on emerging Web standards that make it easier for applications to talk to one another, as well as on open-source technologies such as the Linux operating system.

The subject of rumors during its stealth period, the company today announced a $10 million first round of financing led by Benchmark Capital and former Netscape chief executive Jim Barksdale's Barksdale Group.

"It is kind of ironic," Crossgain chief executive Tod Nielsen said of the alliance with Barksdale. Nielsen was in charge of handling Microsoft's often fractious relations with software developers for 12 years before leaving Microsoft in June to launch the start-up. He also was called to testify on Microsoft's behalf in its landmark antitrust trial, in which Barksdale testified against the software behemoth.

Nielsen said that despite having warred on separate sides of the browser and antitrust battles, the former adversaries found they had much to gain from each other in launching the start-up.

"When they first approached us, they wrote a memo that blew us away," Nielsen said. "They really got the business model and the technology. And also their approach to problems was so different from the Microsoft playbook."

Crossgain aims to be an all-encompassing toolshed for commercial software developers, providing a framework that will take care of some behind-the-scenes infrastructure elements that the start-up is betting developers don't want to rewrite with each new application.

These include Web site challenges such as load balancing, or distributing traffic and tasks evenly among multiple Web servers; fault tolerance, which lets one server take over when another goes down; data center capacity management, which provides for the seasonal ebb and flow of demand; and Web site security.

Nielsen likens his site's aim with the early goal of Microsoft's Windows operating system: taking care of fundamental plumbing to let developers focus on the outward utility of the application.

"In the good old days of developing for DOS (Microsoft's Disc Operating System), developers spent time writing printer drivers," Nielsen said. "Then they thought, 'Why are we writing printer drivers when we're a spreadsheet company?' So Windows came along and extracted printer drivers from developers. Crossgain is trying to remove the complexities of infrastructure in the same way."

Crossgain's goals appear to dovetail--or perhaps compete--with other start-ups that have gotten into the business of providing infrastructure for Web businesses, including Netscape co-founder Marc Andreessen's Loudcloud.

Nielsen took charge at Crossgain this summer, following a group of founders culled from Microsoft's engineering ranks. These include Crossgain chairman and chief technology officer Adam Bosworth--who represented Microsoft's interests in Extensible Markup Language (XML) and database technology with standards organizations and who helped engineer key Microsoft software products, including its Web browser and Web server--and Rod Chavez, who worked on the browser and on Microsoft's XML efforts.

XML is a World Wide Web Consortium (W3C) recommendation that lets developers write Web applications that communicate more fluently with databases, servers, search engines and other back-end systems and applications. Crossgain's service is built around XML.

"If we're trying to be a technology framework that works with Web applications, XML has to be built into what we're doing natively to easily exchange data and information," Nielsen said. "The world is heterogeneous, and we have to link up with all kinds of things. XML is the standard for doing that."

Founded in February, Crossgain was originally funded by its first 12 employees, who raised $3 million among them. Those employee-owners, and now Nielsen as well, collect salaries of $24,000 per year.

"Our burn rate is rather low," Nielsen remarked, referring to the rate at which new businesses go through their cash.

Originally named Succendo (pronounced "soo-shen-doe"), Crossgain ultimately took its name from a horde of non-trademarked names that Benchmark Capital has registered as Internet domains and stashed away.

Crossgain is testing its service among 10 trial, or "alpha," customers. A launch is scheduled before year's end.