Investments

Investment Picks Up And Aria Systems Cashes In

The world of B2B payments management may not get all the breathless and elegiac press that there counter parts at financial services technology get.  But while praise is pleasant of course, and correlated to investor interest, at the end of the day for emerging start-ups how much enthusiasm one can elicit is not nearly important as how much investor interest.

Case in point , Aria Systems – a little billing platform of B2B transactions that is not exactly a household name at this point.  Which is not to say its function is no very important – particularly to the businesses it serves. Aria is dedicated to helping enterprise clients increase recurring revenue streams through the power of its cloud based platform.

Aria’s best known clients are in the SaaS or PaaS (platform as a service) businesses such as Adobe, Red Hat and VMware – though its recent expansion efforts have seen the firm move into new verticals such as automotive, media, entertainment, health care and telecom.

“We’ve seen really nice diversification across other verticals in the last couple of years,” noted Aria Systems CEO Tom Dibble noted in an interview.

And those new frontiers have paid off for Aria – the firm is reporting 145 percent growth over the last year – as well as a bump up in the revenue it is part of managing by several billion.  Next up for the from – says Dibble – is the wonderful and wild world of the Internet of Things  and helping those enterprise clients regularize and increase the revenue they take in from the wonderful world of connected devices.

It’s a bright future the company envisions for itself – and one that is wracking up investor interest, even in the current environment of 2016 when VCs and private equity funds are suddenly a lot less interested in throwing big checks at big ideas (that don’t have big profits behind them).  Aria Systems just bagged $50 million in Series E funding in a round led by Rembrandt Venture Partners, Madison Bay Capital Partners, and Hercules Technology Growth Capital.  The join a rather illustrious investor list that includes (as of their last funding round in 2013) Bain Capital Venture, VMware, Hummer Winblad Venture Partners, and Interwest Partners.

“If you have a good business model and a real technology that you are selling to very real customers that are paying very real dollars, that’s compelling in any environment,” Dibble said. “We did not have a challenge raising this funding. Our customers are very viable and here to stay.”

Investments for the week ended 2-19-16

If two weeks ago was anemic in terms of investment activity, this week just grew a few red corpuscles. But not many. The period that ended Feb. 19 saw total investment of $233 million, quite a bit better than the roughly $130 million seen previously, but not exactly scintillating. The week saw an interesting bifurcation. Whereas previously, and over several weeks, the FinTech space had dominated the investment landscape, with, say 90 percent, and more, of investments in a given period, this past week showed a bit more balance.

Of the $233 million garnered in the week, this time around B2B grabbed 38 percent of the tally.

The deal sizes may remain rather small. But looking with some granularity on the week, we can see there have been some votes of confidence in the B2B space. Most notably, FTV put up $76 million in StoneEagle Services, where the latter has been pushing ahead with its VPay Cards that seek to help replace paper checks, that time-tested but largely inefficient medium of exchange. The $42 million invested in Sprout Social via Series C round gives the nod to the growing importance of data and social media analytics in a financing round led by Goldman Sachs. Below are the Top 5 deals for the week that ended on Feb. 19. Also within the data space, but this time with a focus on security, Vera, a startup, grabbed $17 million in financing through a Series B Round that was led by Sutter Hill Ventures.

The best way to envision the investment landscape thus far into a new year, is that the investments have been as up and down as has been seen in the public markets. The “normalized” level on a week-to-week basis — notwithstanding a few multibillion dollar deals that marked a peak last month — seems to be a few hundred million dollars weekly.

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