Israeli storage management company SANRAD has completed an $8 million financing round. Sequoia Capital Israel led the round, with previous investors participating. SANRAD develops technology and products for data management and storage on IP networks. The company’s product makes it possible to connect different systems from different manufacturers.
Eyal Felstaine, formerly of Allot Communications, and brothers Yehuda and Zohar Zisapel of the Rad group founded SANRAD in 2000. Financed by the Rad group, the company raised $5 million from the Zisapel brothers. SANRAD CEO Shaul Gal-Oz moved to California in recent weeks in order to establish and develop the company there. SANRAD has 50 employees.
SANRAD VP R&D Gadi Erlich, who manages the company’s center in Israel, said, “After two years in which we did not raise capital, the financing round was aimed at obtaining capital for developing markets and enlarging our marketing and sales apparatus. Our focus is in the US, but we also work in other places around the world.
”We have previously signed deals in China, but two thirds of our sales are in the US, so we’ll focus on where our market is, and where there is demand for our new technology.”
The company has already sold products in China. In the first quarter, it installed them at three customers, including a Chinese Army base and a polytechnic institute in Shanghai. Ehrlich says that the development center in Israel will also hire more staff.
”Globes”: What are your expectations?
Ehrlich: ”Our goal is to break even by the end of 2005. This money is intended to help us achieve that. We’re optimistic, because our sales are growing by 50% a quarter.”
What about the competition?
The segment that the company addresses is small and medium-sized businesses. Two companies sell a similar product, or alternatives, but they are also start-ups. The large companies, such as Brocade Communications Systems (Nasdaq: BRCD), McData (Nasdaq: MCDT), and Cisco Systems (Nasdaq: CSCO), focus on the large enterprises segment. We chose this niche in order to minimize competition with the major companies, and the major companies aren’t in our niche at the moment.”
Published by Globes [online] - www.globes.co.il - on August 2, 2004