Fundraising Notes: Xenon Arc, Concurix, Red Loop
Xenon Arc, a semi-stealthy provider of software services for materials manufacturers, has filled out its Series A fundraising to a total of $22 million, CEO Chad Steigers says. The Bellevue, WA-based company had previously reported a $15 million commitment from private equity firm Weston Presidio. Steigers says new cash came in the form of options that were extended by the private equity investors.
Xenon Arc was founded in the fall of 2010, and its online presence is still pretty bare-bones. Steigers tells me that the company does, however, have an initial product in the field with a customer, and is aiming to have a couple more customers in the coming months.
“This conclusion of the Series A is basically going to get us through the first phase of the growth. And who knows, maybe after that we’ll be self-sustaining on cash. We’ll have to see,” Steigers says.
Xenon Arc is targeting big companies that produce materials which other businesses use in manufacturing—plastics, for instance, that could be used in consumer electronics or airplanes. Those companies are often huge enterprises that have focused most of their technology spending on their core business of producing materials, and much less on helping find efficiencies in running the business itself.
“The industry is very advanced form a technical standpoint, in terms of the product itself. They invest a lot in R&D,” Steigers says. “But when it comes to business process, they haven’t invested as much in that, so they tend to have a fair amount of legacy infrastructure that makes it difficult for them to adjust and change and adapt.”
Specifically, Steigers says those big suppliers often have outdated or pretty inflexible software that is dedicated to running the accounts of their biggest clients. Xenon Arc sells software services, including sales and customer-relationship management products, that target those niches in a big materials business. The startup also supplies someone to run the software and keep everything operating. The idea is that, by tracking these smaller sales channels, Xenon Arc can help its large customers get more profits from their sometimes far-ranging businesses.
That fits well into the overall trend of efficiency and business process improvements that companies around the world have been reaching for in the aftermath of the Great Recession. And as businesses and governments everywhere look for more efficiency and less waste in products, materials suppliers are having to ensure that they are making as much money as they can on all of their accounts, Steigers says.
Xenon Arc now operates out of its own headquarters at the Key Center building in Bellevue, having previously been incubated with Microsoft BizSpark, the software giant’s startup program. Steigers says Xenon Arc now has about 20 people, and could see the staff double by year’s end.
A few other notes from the SEC filings:
—Concurix, an enterprise IT software startup, has raised a $1 million seed round as it continues developing its product. The company is headed by Alex Gounares, a veteran of AOL and Microsoft who once served as Bill Gates’ right-hand technical assistant.
As Gounares recently told me, Concurix is revisiting some older concepts of operating system design to help big datacenters get the most out of modern computer chips that are packed with multiple processing cores.
Gounares says the money came from angels and GSharp Ventures, the new “venture equity” firm headed by Voyager Capital co-founder Enrique Godreau and Luis Salazer, a former Microsoft and Yahoo executive. From the looks of this SEC filing, it appears that GSharp’s investment may be $400,000.
John Cook at GeekWire spoke with Red Loop Media Chairman Chairman Harel Kodesh, who says the company has about 50 people spread between offices in Redmond, China, and Israel.