When Craig Malloy pitched Silicon Valley venture capitalists with his idea to buy a six-person company in Salt Lake City, Utah, and move it to Austin, Texas, they looked at him like he was crazy. Ultimately, though, one venture firm, Redpoint Ventures, got on board, and with support from Austin Ventures, Malloy got his way. Armed with $10 million of funding, he moved out of a hardware world in which he was a successful serial entrepreneur and became the new proprietor of Bloomfire, a cloud collaboration software company for enterprises.
Today, the Austin-based company is announcing an additional $8 million in financing from Redpoint and Austin Ventures as it prepares to grow its market footprint. Bloomfire, which counts Etsy, Kellog’s, Comcast, and Exelon among its customers, offers a range of cloud-based enterprise collaboration products, including a Yammer-like communications tool, a Q&A forum, and a learning management system that helps companies on-board new employees.
Malloy found support for his model of acquiring an early stage company and moving it to another city from Austin Ventures, which has an unusual structure in which it behaves much like a private equity company, in addition to having a venture arm. The venture firm, for instance, used a similar “roll up” model with another Austin tech company, HomeAway, an Airbnb competitor which it created by combining existing vacation rental sites.
Malloy decided to buy Bloomfire from its previous owners because he wanted a change of scene from the hardware industry, and because he didn’t want to endure the grind of starting a new company from scratch. He sold his previous company, a video-conferencing hardware firm called LifeSize, to Logitech for $405 million in 2009. Redpoint, which is one of Bloomfire’s major backers, had also invested in LifeSize. Prior to that, Malloy had founded high-tech video company called ViaVideo, which he sold to Polycom in 1998.
New features that Bloomfire announced today include a multimedia content engine that allows drag-and-drop editing, a social engagement system that integrates with LinkedIn, an analytics dashboard that evaluates engagement among contributing members, and improved iOS and Android functionality.
Bloomfire’s product updates and funding announcement come as the company has reached milestones of acquiring more than 200 paying customers and serving more than 65,000 users. It will use its new funding to build its engineering, sales, and marketing teams, and bolster its go-to-market strategy.
[Picture by Akakumo]