American Statesman: Innography Raises More Money
Author: Lori Hawkins - American Statesman Staff
Austin-based Innography Inc. has raised $3 million in venture capital to ramp up marketing and development of its intellectual property software.
Founded in 2006, Innography sells software services that help companies manage, protect and leverage their patents.
Austin Ventures and Covera Ventures made the investment. The two firms have previously invested $6.5 million in the company.
CEO Rob Lynch said the money will help position Innography for expansion next year.
"We have enough cash in the bank for 2010, but this lets us make some hires now, in order to significantly accelerate our growth in 2011 and 2012," Lynch said. "We're going to be making investments in the product, and we'll focus on raising the awareness by spending time with industry analysts. We're also going to be putting money into business development, generating the right types of partnerships with larger companies."
Innography's software lets companies track and keep inventory of their patents, find potential licensing partners and follow competitors' patent activity.
Innography uses a software-as-a-service model, with customers paying between $40,000 and $500,000 for an annual license.
Lynch said Innography tripled its client base last year to more than 100 customers, including Eastman Kodak Co., General Electric Co. and Kellogg's. "Last year was a tough year in the market because of the recession, but we actually had a very good year," Lynch said. "We increased our revenue by five times, and we are planning to double our employee base this year."
Innography has 35 employees and is adding workers in all areas, Lynch said.
Austin Ventures general partner Chris Pacitti said his firm approached Innography about taking additional investment.
"This is one of those happy circumstances where the venture guys are begging the company to take more money," Pacitti said. "They had a burst of growth over the past year, and given the challenges of the economy, it was a unique breakout story.
"This money will give them some cushion, so they can feel comfortable making some additional hires and achieving more substantial growth than might have been possible otherwise," Pacitti said.
For Innography, accepting additional funding now means not having to devote time to fundraising later, Lynch said.
"It requires a substantial amount of time to raise financing," he said. "Now, instead of spending six months on the road, which means potentially taking your eye off the ball, we'll be focused on signing new customers."