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Open-source start-up nabs $4 million in funding

MuleSource convinces two VCs that there's money to be made in bringing open source to integration software.

A start-up called MuleSource has convinced two venture capitalists that there's money to be made in bringing open-source methods to the software that ties together existing computer applications, CNET has learned.

MuleSource closed a deal Tuesday for $4 million in funding split evenly from Hummer Winblad Venture Partners and Morgenthaler Ventures, said co-founder and Chief Executive Dave Rosenberg. The company is aiming for a place in the market for integration software, sometimes called an enterprise service bus, that passes messages among different applications that often don't know how to communicate directly.

The company's technology is based on the Mule open-source software launched by co-founder and Chief Technology Officer Ross Mason, a consultant who specializes in integration issues.

San Francisco-based MuleSource, with seven employees so far, plans to formally launch in September, the same time it releases a new version of the Mule software. The company plans to sell recurring subscriptions for software support, Rosenberg said.

The start-up and its funding reflect the scramble to supply open-source server software. The Linux operating system, on display this week at the LinuxWorld Conference and Expo, showed that money can be made supporting open-source software, and now numerous companies are trying to reproduce its success with software for e-mail, Java, customer relations management, databases and more.

Rosenberg stumbled across Mule when looking for software to use on a project of his own. "I found it was the most robust, the best architected and had a large community doing support," he said.

But it's not the only option. In addition to established companies such as Tibco and IBM already in the market, there are several open-source alternatives. Among them are Celtix, part of the ObjectWeb project; and JBoss Messaging. And Sun Microsystems released an open-source project called the Java System Enterprise Server Bus in 2005.

Mason isn't worried. "Mule is more mature technology. It's been around for three years, but the other guys announced a year ago," he said. And Mule has not only a core engine but also numerous modules to communicate with various types of applications, he said.

And Mule is "on par with closed-source rivals," Rosenberg said, with several Fortune 1,000 customers. The company said it knows of more than 100 instances where companies are using, not just testing, the software.