VC watch: StorageWay grabs $42 million

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Thursday's deals

• StorageWay said it received a $42 million third round of funding, led by Matrix Partners and Redpoint Ventures. StorageWay also attracted investments from GE Equity, Lighthouse Capital Partners, Montreux Equity Partners, Needham Capital Partners, Sands Brothers, Wheatley Partners and Worldview Technology Partners. The latest round is expected to take the storage-area network company to profitability by the end of next year, said Chief Executive Kim Fennell. StorageWay manages the storage and backup of its customers' data, and its technology allows them to put multiple customers on a single storage system while still maintaining customer security, Fennell said. The Fremont, Calif.-based company has raised a total of $98 million and received a decline in valuation with its latest round.

Wednesday's deals

• GiftCertificates.com, an Internet-based gift certificate company, said it secured $21.7 million and may receive more to help it become cash-flow positive by year's end. Of the $21.7 million in funding, $14.2 million is in cash form and $7.5 million is in the form of a credit line from Imperial Bank, a Comerica company. The Carlstadt, N.J.-based Web retailer said its latest cash infusion, which brings the total it has raised to $110 million in three years, came from four prior backers and one new investor. Mellon Ventures, SCP Private Equity Partners, Gotham Partners and Baron Funds were joined in the funding round by new investor W.R. Berkley, a Greenwich, Conn. insurance holding company, the company said.

• RadioFrame Networks said it has raised $11 million in two funding rounds. The Redmond, Wash.-based company, which makes equipment that extends wireless reception into buildings, said the $4 million first round was led by COM Investments along with Nicolas Kauser and Nextel Communications. COM Investments is the personal investment company of Craig McCaw, the former CEO of McCaw Cellular Communications, which is now AT&T Wireless. Kauser was the former chief technology officer at AT&T Wireless. The venture capital firm Ignition led the $7 million second round with Orange Ventures and Nextel also jumping on board. Orange Ventures is the VC arm of European wireless carrier Orange. RadioFrame's equipment acts as a miniature wireless site that boosts access within buildings and other structures which can often interfere with wireless coverage indoors. The gear can work with multiple communications protocols and can serve, for example, phones that run on different carrier networks.

• FFWD has received more than $12 million for its third round of funding. The Pittsburgh-based company attracted investments from PNC Technology Investors and previous investors Adams Capital and Mellon Ventures. FFWD has raised a total of $38.5 million and received an increase in valuation with this latest round. The company develops software designed to let customers create and manage online marketing programs and conduct e-commerce.

• SupplyWorks has received a $19.2 million second round of funding, which was led by Longworth Venture Partners. Other investors include Spinner Global Technology Fund and previous investors North Bridge Venture Partners and Atlas Venture. Bedford, Mass.-based SupplyWorks has raised a total of $26 million. The company develops software designed to help it customers manage relationships with suppliers.

Tuesday's deals

• Chip designer PetaSwitch said it raised a $4 million first round of funding. Wasserstein Ventures led the round and Draper Fisher Jurvetson also participated. Both venture firms will receive a seat on PetaSwitch's board. The San Jose, Calif.-based company designs chips for metropolitan and wide area networks.

• Vocus said it closed its $13.4 million second round of funding. The Lanham, Md.-based company has raised a total of $15.4 million and received nearly a 500 percent increase in valuation, CFO Stephen Vintz said. Lazard Technology Partners led the round and Sterling Venture Partners also participated, along with several previous investors. Vocus develops automation software for the public relations industry, which performs functions such as gathering articles from clipping services and storing them, to sending out copies of press releases in bulk e-mails. Public relations employees at Arthur Andersen, Southwest Airlines, Allstate Insurance and Nordstrom are among those using its software.

• Terraspring has raised a $28 million fourth round of funding and named former IBM executive Ian Bonner as its chief executive. Bonner, former IBM vice president of global business partner marketing, set up Big Blue's software distribution model in the early 1990s. Fremont, Calif.-based Terraspring provides software that allows companies to monitor and re-allocate their computer processing power to areas within the company where it is most needed. Investors in this latest round include Accel Partners, EMC, Hewlett-Packard and Mohr Davidow Ventures.

• Concentric Visions raised an $8.1 million second round of funding, led by Sigma Partners. Other investors included GrandBanks Capital, a new venture firm formed in partnership with Softbank Venture Capital. Concentric Visions has raised a total of $10 million and received an increase in valuation with its latest round. The Boston-based company provides software that allows corporations to build and manage rich media, such as video, audio, Flash and JPEG formats.

• BrightLink Networks said it raised a $35.8 million fourth round of funding, led by ePlanet, an affiliate of venture capital firm Draper Fisher Jurvetson. Other investors included Draper Fisher Jurvetson, The Goldman Sachs Group, Menlo Ventures, Mitsui, The Sprout Group and Vision Capital. Sunnyvale, Calif.-based BrightLink has raised more than $113 million. The company builds optical switches that can handle up to 2.5 terabytes of capacity on a network. The switches also monitor the network for such events as a fiber channel that fails and then can reroute a customer's data.

• Pactolus Communication Software raised a $6 million third round of funding. Commonwealth Capital Ventures led the round, with YankeeTek Ventures and Mid-Atlantic Venture Funds participating. Westborough, Mass.-based Pactolus has raised a total of $10 million. The company develops software designed to allow service providers to create their own XML-based applications.

Monday's deals

• Zolo Technologies said it raised $32.5 million in a second round of funding, which was led by Canaan Partners. Other investors included 3i Group, Infineon Ventures and previous investors Crescendo Ventures, Morgenthaler Ventures, Anschutz Investment and Telecom Partners. The Louisville, Colo.-based company has raised a total of $50.5 million. Zolo has developed hardware to split light coming down fiber optic networks. Zolo's customers can then redirect the light into various channels, or monitor the performance of the light.

Friday's deals

• ZettaCom expects to announce Monday it closed its $47.5 million second round of funding. Investors include Norwest Venture Partners, Granite Global Ventures, Venrock Associates, J.&W. Seligman, Development Bank of Singapore, J.P. Morgan Partners, k1 Ventures, Vertex Management, Crimson Ventures, Infineon Ventures, U.S. Bancorp Piper Jaffray, Banc of America Securities and United Investments. The Santa Clara, Calif.-based company has raised a total of $58.5 million, of which Norwest contributed a total of $10.2 million. ZettaCom is a networking semiconductor manufacturer for the optical and multi-service network industry.

• InsightShare announced on Friday it raised $2 million of its anticipated $3 million second round. The Andover, Mass.-based company has raised a total of $13.8 million with this latest investment. Investors in the latest round include Pearson PLC, The Forum Corp. and private investors. InsightShare provides customer relationship management software and services, which allow companies to have real-time online discussions with their customers.

• Cycolor closed a $13.5 million mezzanine round, marking the last round of funding the company anticipates before eventually launching an initial public offering. Miamisburg, Ohio-based Cycolor declined to list investors in this latest round, but noted previous investors have included CP Holdings and Softbank. The company, which has raised a total of $68.5 million, manufacturers and sells digital imaging print media that acts like film and offers software to convert digital images into color prints. Softbank is an investor in CNET Networks, publisher of News.com.

• iVita announced on Friday that it received an additional $6 million for its second round of funding. The Houston-based company attracted investments from Austin Ventures, J.P. Morgan Chase and Sternhill Partners, bringing its second round to $21 million. iVita, which has raised a total of $25 million, has developed software designed to help companies determine what assets they own and how to improve the financial decisions behind those assets. The company's software, for example, could suggest the best time to sell existing servers, to buy the latest and greatest equipment on the market, and offer the fair market value of those assets.