Investors Bet Big on with $48M Round may just have shattered the notion that you can build a successful Web 2.0 company without much capital.

Aiming to redouble its already startling growth rate, the Palo Alto, CA-based online document sharing startup said today that it has collected a whopping $38 million in Series D funding from six top Silicon Valley venture firms. First-time investor Meritech Capital Partners led the round; it was joined by new investors Andreessen Horowitz and Emergence Capital Partners. Previous investors Draper Fisher Jurvetson, Scale Venture Partners, and US Venture Partners also chipped in.

In addition to the equity-based financing, said it has arranged for a $10 million secured capital line from Hercules Technology Growth Capital (Nasdaq: HTGC), a specialty venture-debt provider.

In its previous three rounds of venture fundraising, collected only $30 million in total. So this big new cash infusion—raised against a valuation that was “significantly higher” than the company’s Series C valuation one year ago, according to Aaron Levie,’s co-founder and CEO—is an important sign. It means the investors are even more confident than before in’s technology, which allows individuals and companies to share and annotate documents stored in secure online folders on cloud servers owned by “We’re obviously very bullish about what we’re building, so we wanted to make sure that we had the financial capability to really see this mission through,” says Levie, 25.

What is that mission? Matt Holleran, a venture partner at Emergence Capital, says “has the chance to be the cloud content management service provider” for businesses. That’s an audacious goal, given that giants like Microsoft and EMC would also like to own the market for enterprise document sharing. Those companies have spent many years and hundreds of millions of dollars developing and marketing systems like SharePoint, Microsoft’s server-based document sharing system, and Documentum, EMC’s own platform for content management and collaboration.

But is a child of the Web and the Facebook era, rather than an earlier age of desktop and server-based enterprise applications built to work only inside corporate networks. That means it’s less intimidating to use—and it also means word about the service spreads more virally. “You don’t get to the 5 million users they have today and the 60,000 businesses without users actively introducing it to others in their workflow, and that is a fundamentally different model from SharePoint,” says Holleran. “ has the opportunity to grow that market substantially and become the leader.”

Sustaining’s current growth rate—the company’s revenues grew by 340 percent in 2010—is going to take money and people. In 2010, doubled its head count from 70 to about 140, in part by hiring senior talent away from established tech strongholds like EMC, Google, Intuit, Oracle, and Now the company must … Next Page »

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Wade Roush is a contributing editor at Xconomy. Follow @wroush

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