I think this is one where Josh really wants to build a Fortune 500 company. I think he's going to do it. This is one where you put the money in and ride it for the long haul. —Todd Chaffee, general partner at IVP
Domo Technologies Inc., the newest venture from Omniture Inc. co-founder Josh James, raised $20 million from Institutional Venture Partners to help it expand its business intelligence company.
Menlo Park, Calif.-based IVP's equity stake is part of a so-called Series A-1 round of financing. In July, Lindon-based Domo said it raised $43 million from angel investors and Benchmark Capital.
"We're getting a lot of feedback from the market place," James said in an interview with the Deseret News. "We've started our beta program and the initial feedback from customers has been extremely strong. [IVP] has been following up with us for every week since we closed our last round."
Domo has received several offers from venture capitalists wanting to invest, including three this past week. The company went with IVP because of James' connections with the firm and because it gives the company options.
"It gives us more runway and more strategic alternatives," James said. "It's kind of like being a public company while being private."
Todd Chaffee, general partner at IVP, will assist the company on the board level and "help open doors," James said.
Chaffee led the public equity investment in James' Omniture in 2008. The firm has invested in other major technology companies like Twitter, Netflix and Living Social.
"Josh has all the attributes to look for in an entrepreneur," Chaffee said in a phone interview. "Those of us who have been doing this for a while know that it's all about management. If you find really good managers and back them, you'll generally do pretty well."
Domo has created an enterprise dashboard for executives that allow them to aggregate information from all branches of their company. IVP was attracted by the different approach that Domo is taking to business intelligence, especially after its representatives visited the company.
"It's got all the characteristics of an attractive investment," Chaffee said. "That's why we proactively sought out Josh and put together this investment.
For typical investments IVP wants to make three to five times the investment in three to five years, which is roughly a 40 percent internal rate of return, Chaffee said. But IVP sees Domo as a longer hold of about five to 10 years.
"I think this is one where Josh really wants to build a Fortune 500 company," Chaffee said in a phone interview. "I think he's going to do it. This is one where you put the money in and ride it for the long haul."
Domo received $43 million in seed investments including $33 million from Menlo Park, Calif.-based Benchmark. The other $10 million came from angel investors including Salesforce.com Chief Executive Officer Marc Benioff and John Thompson, chairman of Symantec Corp.
Almost all of the company's expenses have been on research and development, James said. Domo's product is in beta and is attracting a large amount of companies and revenue.
There are over 1,000 people or companies who want to demo the product, with about 75 percent asking to install it, James said. These companies are starting to generate revenue, with contracts ranging in price from $50,000 to more than $1 million.
Domo plans to continue its recruitment campaigns as long as they are capable. Most of the company's 100-person workforce comes from inside Utah and consists primarily of engineers and developers.
James will maintain control of the company even after all the investments that have come in.
"I control the company," James said. "The investors understand that and they like it frankly because they know how committed I am to this."
There are no plans on raising additional money at this time. The company may seek for more in the future, James said. James told the Deseret News in July that the $43 million it had raised should be enough to hold them unless they see more opportunities.
"You hope that there is not another raise," James said. "If there is, it is maybe because there is market opportunity."
The company plans to release names of large global customers and details behind its products and strategy within the next few months.
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