Cloud service marketplace AppDirect raises $35M

AppDirect will put the funding toward platform development and international expansion

Financial trends and news by Steven Loeb
April 10, 2014
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AppDirect, a cloud service marketplace and management company, has raised $35 million in Series C funding, the company announced on Thursday. The round was led by new investor Mithril Capital Management, with existing investors, including iNovia Capital and Foundry Group, also participating. 

The new funding comes only seven months after AppDirect last raised funding, a $9 million Series B this past September. The company has now raised a total of $60 million.

Founded in 2009, works with channel partners, such as large telecommunications companies, hosting providers and retailers, including Comcast, Deutsche Telecom, Rackspace and Staples. It then white labels app stores for them to offer apps to their business customers.

For example, a  business will go to Staples and, instead of buying Microsoft or Google apps on the shelf, will be able to select the apps they need, then offer them to employees to manage them all with a single password, Daniel Saks, co-founder and co-CEO of AppDirect, explained to me. Ultimatelty, this saves businesses both time and money, in that they will often get a discount, as it is cheaper to buy apps as part of a bundle. 

"They also don’t have to use additional services that then require a need to hire an IT administrator or support person," said Saks. 

The funding will go toward two goals. The first is platform development, including going deeper into billing and enterprise apps. The money will also go toward international expansion, notably countries in both Asia and Latin America, Saks said. 

"Right now AppDirect makes it easy for businesses to find buy and use tools they need," said Saks. "We want to get distribution around the world so we can continue to provide to that to the developer community."

AppDirect has seen a lot of growth in the past year, going from 12 to 20 million worldwide, and expanding from 80 countries to 150. The number of business users grew by 200%, and app sales on the AppDirect Network have grown by more than 25% month over month. The company also doubled the size of its team to 150 employees

"We see a world where businesses can access everything they need from trusted devices, and that we area critical piece toward enabling that," said Saks. "Without AppDirect there would be huge fragmentation. It would be hard to secure, and access, all these great tools from a single platform."

The San Francisco-based company's clients include Samsung, Staples, Deutsche Telekom, TeliaSonera, Rackspace, Swisscom, Cloud Foundry. Its solutions include Microsoft Office 365, Box, and Google Apps.

Last year AppDirect bought Boulder, Co-based Standing Cloud, a startup founded in the same year with a similar-though-complementary offering targeted at the same small- to medium-sized businesses (SMBs). Standing Cloud had raised $10 million in venture financing, from top VCs, such as Foundry Group.

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