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IN THE PRESS: A10 NETWORKS HAULS IN $23M FOR SERVER LOAD BALANCER

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By Scott Denne
Dow Jones/VentureWire
07/14/2008

A10 Networks Inc., a maker of Web application delivery equipment, has secured $23 million in its Series C round.

Existing investor Mitsui & Co. led the round, which gave the company a post-money valuation between $75 million and $85 million, said Lee Chen, the company's founder and chief executive. Also participating in the round were new investor China Investment & Development Co. and existing investors Triton Ventures, H&Q/Asian Pacific, Harbinger Venture and Enspire Capital.

A10 Networks, based in San Jose, has raised $39 million in financing since its founding in late 2004.

The company makes Web application delivery, or server load balancing, equipment that Chen said offers "twice the performance and half the cost" of its main competitor, F5 Networks Inc.

The proceeds of the round will be used to expand into the European market, which it expects to enter around the end of this year or the beginning of next year. Some of the capital will also be earmarked for additional research and development, Chen said.

The company sells its equipment to telecommunications companies and large enterprises including Toyota Motor Corp., NTT Plala Inc. and Gap Inc. About 45% of its revenues come from the U.S. and about 25% come from Japan, according to Chen.

Chen said he expects this round to bring A10 Networks to profitability sometime in early 2009.

In addition to F5 Networks, the company competes against Cisco Systems Inc.; Citrix Systems Inc., which acquired venture-backed NetScaler Inc. in 2005 for $300 million; and publicly traded Radware Ltd., with a market capitalization of about $160 million.

Kiichiri Takanami, a general manager of Mitsui's IT service division, will take a seat on the company's board as a result of the transaction.