ASP gets $30 million antidote
Despite troubles in the application service provider market, NetLedger says it has secured $30 million in financing from investors led by Oracle Chief Executive Larry Ellison.
StarVest Partners joined the Oracle chief in funding the San Mateo, Calif.-based company, which provides services to the small-business sector, the company said in a statement.
NetLedger plans to use the funds to further product development and marketing efforts and to broaden its distribution channels through strategic business partnerships.
ASPs host applications that customers can access from a desktop for a fee, making money from businesses that want a low-cost, low-management way to use software.
The funding comes as the ASP market is in a state of flux and consolidation, with many players rushing to fine-tune their business models and achieve profitability. Services have gotten a big push from many technology providers, but slow acceptance by customers has vanquished such start-ups as Red Gorilla and HotOffice.com, and sent more-established companies such as J.D. Edwards into retreat.
But NetLedger's financiers may have their eyes on eventual market gains. According to a recent survey by Jupiter Media Metrix, ASPs have a bright future as Web-based software becomes more common and the flow of business data and information continues to get automated online.