Networking software startup DriveNets has emerged out of stealth with a $110 million Series A funding led by Bessemer Venture Partners and Israel’s Pitango Growth. The funding gives the previously bootstrapped company a valuation of more than half a billion dollars, according to reports.
The amount may seem high for a startup’s first round of funding but Israel-based DriveNets has been busy since it was founded in late 2015. The company won its first major contract in 2017 and has since “recorded revenues of tens of millions of dollars,” according to its own press release. DriveNets currently employs 150 and with the new financing, plans to hire another 50 people by year’s end. It also plans to use the new capital to expand its product portfolio and enter new markets globally.
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The company’s co-founders, Ido Susan and Hillel Kobrinsky, have had previous success in the space. Susan previously co-founded Intucell, which was also backed by Bessemer and ultimately acquired by Cisco for $475 million in 2013. And, Kobrinsky founded web conferencing specialist Interwise, which was acquired by AT&T for $121 million in 2007.
What makes DriveNets offering so compelling is that, the company claims, it is addressing one of the telecommunications industry’s biggest challenges: that demand for services continues to rise while customers’ costs are not climbing proportionally.
DriveNets says that its “Network Cloud” solution gives communication service providers (CSPs) a way to meet increased capacity demand without having it eat into their profits. Per the company, “Network Cloud radically simplifies network operations, as it can create any network function from the same software stack and only two generic hardware building blocks. And since the entire infrastructure is software-centric, Network Cloud accelerates new service rollouts at full network scale.” DriveNets’ software runs over what it describes as a “low-cost white box hardware” that can address any routing use case, helping CSPs open up and commoditize their physical infrastructure.
Aaron Mankovski, managing general partner at Pitango Growth, joins DriveNets’ board of directors as part of the funding.
“DriveNets’ Network Cloud does to service provider networks what Amazon, Microsoft, Google and Facebook have done to compute and storage in data centers,” Mankovski said in a press release. “It creates a unified shared networking resource that can deliver any service on any port – and at any scale.”
Illustration: Li-Anne Dias