VentureBeat

Corrected

Mimosa Systems, a startup that helps companies archive emails and other files, has raised a $17 million fourth round of funding. Mimosa calls the latest financing a “mezzanine round,” meaning it should be the last round before an IPO.

The kind of comprehensive archiving that Mimosa offers is necessary for the “eDiscovery” process — namely, the process of searching through a company’s electronic records. With the growing number of legal requirements for corporate record-keeping, including the Sarbanes-Oxley Act, there’s been a lot of money entering this field. Last June, for example, Automatic acquired market leader Zantaz for $375 million (although the startup’s founder and early investors didn’t see much of a payoff). Correction: The company that acquired Zantaz was Autonomy.

When we wrote about Mimosa a year ago, we portrayed the company as playing second fiddle to Zantaz, but the Santa Clara, Calif. startup seems to be doing pretty well for itself. It has raised a total of $51 million and has offices in Germany, the United Kingdom, Japan, China, Australia and India. Mimosa recently moved beyond emails, attachments, instant messages and backup tapes and now says it can archive any file. Even more interesting, chief executive T.M. Ravi says Mimosa will make its application programming interfaces (APIs) available to third-party applications later this year.

The recent funding was led by Focus Ventures, with participation from existing backers August Capital, Clearstone Venture Partners, JAFCO Ventures and the Mayfield Fund.

Updated

Job site Jobster has raised another $7 million in a fourth round of funding. It’s not a huge amount of cash, but it comes on top of the $48 million that Jobster previously raised at a $100 million-plus valuation.

With all the job sites out there, we’ve been skeptical about Jobster’s (and other sites’) ability to be heard above the noise. Since we voiced that concern more than a year ago, even more sites have emerged — for example, I’ve covered NotchUp, which has the novel hook of paying job seekers for an interview, and there were two very different job sites making their pitch at the most recent Y Combinator demo day.

Some of our concerns were assuaged by chief executive Jason Goldberg’s salesmanship, and the fact that Jobster has signed up a bunch of corporate customers. But Goldberg actually left in December, replaced by Jeff Seely, who helped sell trading site Sharebuilder. Presumably, the new funding is part of Seely’s efforts to revitalize the Seattle startup. Investors included Ignition Partners, Trinity Ventures, Mayfield Fund and Reed Elsevier Ventures.

Update: I asked Christian Anderson, Jobster’s director of corporate communications, what the funding means for the company, but he told me he can’t say anything. It sounds like there may be more news (perhaps some new features, or a new focus?) in the pipeline.

Gigya, the Silicon Valley company that lets companies including RockYou track how advertising performs on their widgets across the Web, has raised $9.5 million in a second round of funding from Mayfield Fund and existing investors Benchmark Capital and First Round Capital.

Gigya, based in Palo Alto, Calif., offers ad-monitoring technology among a number of other tools it supplies to widget-makers like RockYou. Gigya helps companies make widgets, but its real focus is on helping those companies — clients include Toyota, Sprint and MTV — spread the widgets across the web and track their performance.

Among other things, it provides drop-down menus that lets users select which social networks they want the widget on (see image at the bottom of the page). This lets widget owners make, say, Orkut the first choice, if the owner wants to market the widget among Brazilian users, or Facebook the first choice if the owner want to market to Canada 20-somethings.

Gigya’s technology is used to install hundreds of thousands of widgets per day, the company says. It tracks more than three billion widget impressions per month. It says it is the largest widget distribution network (for proof, check out the logo-cloud above, which shows the companies it serves).

However, large widget companies like Slide use their own internal technology for distribution and tracking advertising impressions. Clearspring is another competing company, but Clearspring hosts widgets on its own servers, and so maintains more control over the widget making and distribution process. Gigya, by contrast, simply provides a code that is inserted into widgets, and customers like Toyota can choose to run the widgets from their own servers.

Gigya hasn’t focused too much on making money too date, instead it seeking to become the distribution standard on the Web. But it does plan to make money from revenue shares, for example from a company like Toyota, which might pay Gigya a fee for help in distributing its widget to third-party sites.

Co-founder Rooly Eliezerov told me he hopes the company will reach break-even within the next year and a half.

Mayfield’s Navin Chaddha joins Benchmark’s Michael Eisenberg on Gigya’s board.

Adchemy, which uses “predictive algorithms” to help companies place online ads more efficiently, said it has raised $19 million in a third round of funding.

Adchemy is a relatively quiet Silicon Valley company that has been studying what makes ads more effective. It has built a library of data that shows how things like ad size, ad keyword structures, genre of web site, and the anchor text of a page all affect how well an advertisement performs. It has found, for example, that ads for universities don’t do very well on career sites, but do better on weather or astrology sites.

Moreover, the company tracks data not only on how many people click through on ads, but how many actually follow through and buy something. Finally, by tracking action over time, the company says it can tell what sort of leads are likely to be more lucrative than others. So the company can charge different prices per lead, depending on whether they are promising or not.

To begin with, the company has focused on two industries, career/education and financial services. CEO Murthy Nukala is keeping the ingredients of his secret sauce to himself, but said his approach is much more helpful to advertisers than that of competitors. For example, Quinstreet, one of the larger players in the online career/education advertising market, uses few of these measurable approaches, he said.

The Redwood City, Calif., company has ambitious plans for 2008, Nukala told VentureBeat, which will likely include the unveiling of new products and a doubling or tripling of its workforce.

Customers like Charter One and The Art Institute of Pittsburgh’s online division hire Adchemy to identify the most effective types of ads and the best locations for them. According to Adchemy, the company’s customers receive an average return of two to five times their investment.

Nukala founded the company 2004, and has now raised a total of $27 million.

Nukala likes to compare his scientific approach to Google’s focus on technology. “We’re the only company in the market that has what we call a high science approach,” Nukala said.

Comparing Adchemy to Google seems pretty grandiose, but Nukala didn’t pull it entirely from thin air: Stanford Prof. Rajeev Motwani, who co-authored the PageRank paper laying the foundation for Google’s search engine, is on Adchemy’s board, Nukala noted.

Leading the recent round of investment is the Mayfield Fund of Menlo Park, with additional investments from Hellman & Friedman and August Capital.

Adchemy has 70 employees, up from 50 in just a month, said Nukala. The company will be announcing more products later this year, but he said it’s too early to offer any details.

Updated

Widget-maker Slide has raised nearly $50 million at a $550 million valuation from two private equity funds, Fidelity and T-Rowe Price, according to the New York Times, with the two firms buying a total of around a nine percent stake in the company.

San Francisco-based Slide has more than 144 million users of its widgets on Myspace and other social networks, and another more than 50 million total (not necessarily active) users of its Facebook applications, according to Kara Swisher at AllThingsD, who first reported that a large round was in the works earlier today.

However, Slide hasn’t, as far as I know, publicly stated significant revenue streams — as is the case with many other Myspace widget and Facebook application companies. A large funding round could mean that the company has proven to investors that it can monetize.

On the other hand, investors may just be impressed with the number of eyeballs Slide has attracted. The company’s Top Friends Facebook application, which lets you designate and display your favorite Facebook friends on your profile page, has 2,483,760 daily active users. Its FunWall application, which replaces Facebook’s “Wall” of messages from your friends on your profile with its own features, such as video-sharing, has 2,762,039 daily active users.

Note: Facebook applications give third-party developers direct access to user data, such as your list of Facebook friends, which companies like Slide can use to make more compelling applications, like Top Friends.

Slide sees itself as a “distributed media company,” relying on its widgets and applications to create new forms of entertainment for social network users. For more, see my interview with chief executive Max Levchin from last June. Its latest efforts include involvement in Open Social (our coverage), a Google-led effort that’s in development, that intends to create a standard means of implementing social networking applications on Facebook rival sites, including Myspace.

Main competitors to Slide include RockYou, which also has popular Facebook applications as well as widgets on other social networks. RockYou claims to have passed Slide as the most popular Facebook app company, as I wrote last month, although it’s not clear if that’s still the case. In late August, Slide claimed the number one spot.

Slide would use the money to expand as well as buy other companies, Swisher says, and has hired investment bank Allen & Co. to help raise the round (the bank, among other things, is also helping Digg shop itself around).

Slide’s previous valuation is based on the approximately $20 million that it raised in 2006 from Khosla Ventures, Mayfield Fund, BlueRun Ventures and Founders Fund (our coverage).

PlayFirst, the publisher of the popular online game, Diner Dash, has raised an eye-opening $16.5 million in its third round of financing.

The company stands out because it’s one of the first mainstream American online game publishers to embed micro-transactions, small payments for access to new game content, into its game. The marquee title, Diner Dash: Hometown Hero involves controlling a waitress who runs around a restaurant trying to keep her customers happy. PlayFirst offers one playable restaurant and a standard avatar for free, but to soup up your avatar or get access to new restaurants, you pay small bits of cash.

Until Hometown Hero, the only way to play Diner Dash games was to drop $20.

The company is also announcing a partnership with widget-maker RockYou, to distribute one of PlayFirst’s games on Facebook.

The micro-transactions move has paid off: The company says it has doubled its revenues since 2006 and that Hometown Hero is on track to outsell its predecessors by a significant margin. The forums are more active, and 50 percent of the transactions involving the game are micro-transactions of $5 and under.

With this investment, the company intends to accelerate development of new games, extend its reach into consoles like Nintendo DS and Xbox360, and expand into international markets, especially those in Asia. The partnership with RockYou gives the company access to the so-called “social graph,” but the implications of this aren’t clear, and even PlayFirst says it is not exactly sure where this will lead.

However, PlayFirst says it will be releasing a steady stream of apps each quarter, starting with simple game widgets and expanding into richer content, but declined to offer details.

DCM led the investment, and previous investors Mayfield Fund, Trinity Ventures, and Rustic Canyon Partners participated in the round. The company has now raised a total of $26.5 million.

Two-and-a-half year old startup TimeBridge is launching its flagship scheduling product today, and it’s a product that shines with simplicity.

Plenty of internet startups have made a business out of saving time for busy professionals. TimeBridge’s niche is cutting down the time it takes to schedule meetings. It’s product, Personal Scheduling Manager, works on reaching consensus through a straightforward visual interface, a clear improvement over the process of emailing back and forth between all a meeting’s participants that most organizers use.

Here’s how it works: The program, which is a small download for Microsoft Outlook users or a web app for Google adherents, syncs with the user’s calendar to show which time slots are open. The user, who we’ll assume is initiating the meeting, can then highlight blocks of time that would be acceptable for a meeting.

Invitations are then sent off to the other participants, who can see all the times the organizer has available and choose their own set of open time slots. Through a process of elimination, the times that other participants can’t make it to a meeting are ruled out, and a confirmation for the best time is sent out to everyone.

TimeBridge’s CEO, Yori Nelken, says it took two years to build the product, a claim that’s hard to believe in light of how quick and simple it is to use. But that’s what a good web app does — fits in seamlessly with a user’s life, then stays out of the way as much as possible.

One caution — we’ve been skeptical before that yet another scheduling company might have a chance to make it. TimeBridge is clearly an additional feature for calendars, not an entire stand-alone product. If anything it’s the fragmentation of the market, with different users going to Outlook, Google, or their PDA for their calendar, that provides an opening for another service to tie them together for users.

The company plans to make money by making deals with other business programs, for instance, suggesting a web conferencing program to users who plan on holding a remote meeting. It could also offer a white-label version of its Personal Scheduling Manager to interested companies.

TimeBridge is based in San Francisco, Calif. The company raised $6 million last year from Mayfield Fund and Norwest Venture Partners, and plans to start raising another round in January.

 Updated

Consorte Media, a niche ad network targeting the increasing number of Hispanics online, has raised $7 million in its second round of financing.

While Latin America is slowly getting online, the overall Hispanic market on the web, estimated to be at around 20 million consumers, has been getting significant attention. In August, Batanga, a Hispanic entertainment portal, raised $30 million. In September, Wamba, a social network for Latin America, raised 3 million Euro, and Sienna Ventures has been building a $100 million fund to invest in Hispanic-focused companies.

The investment in San Francisco’s Consorte, which has recently added two former Univision sales directors to its team, is yet another example of interest in this market. It also indicates the momentum behind niche ad networks, spurned on by the success of Glam and Federated Media. The idea behind niche ad networks is that, unlike monoliths like AdSense, the more agile companies can bring extensive knowledge of a smaller corner of the web to attract content sites that fit the mold and deliver them directly to advertisers. Consorte has signed up around 300 Hispanic content sites that, together, deliver a billion impressions per month. Its customers include Best Buy and Monster.

Sutter Hill Ventures led the round, which included follow up funding from Mayfield Fund.

[Updated: The original post said that Consorte had around 50 sites in its network.  That number is now 300]

Here’s the latest action:
1) Brightroll raises $5M for video ads
2) LGC Wireless acquired for $169M plus
3) InterviewUp, answers for job interviews
4) Alibaba.com to go public
5) Yahoo’s CMO leaves, without explanation
6) Tesla’s shocking $1M crash tests
7) Tumblr, Collective Media, Veeker, MobileEye, BioFuelBox, GameLayers, Shooner, all raise cash
8) Boston’s Entrepreneur site

Brightroll serves billionth video ad, raises $5 million – The mark comes less than six months after serving half that number. The San Francisco company, which helps large ad agencies and brands sell video ads across leading web sites, has also raised $5 million from new investor KPG Ventures,
True Ventures and Adams Streep Partners.

LGC Wireless acquired by ADC Telecommunications – As we reported last week, LGC Wireless has been bought. Now its official by who. ADC picks it up for $169 million plus about $20.5 million in debt. LGC’s technology strengthens cell signal coverage in buildings, airports and other indoor areas. LGC Wireless had sales of $83 million in year ending Sept. 30. The 11-year-old company had raised $93 million in funding. Investors included Rembrandt Venture Partners, the Mayfield Fund, Allegis Capital, Crystal Ventures, Intel Capital, Hutchison Whampoa Ltd. and Dali Hook Partners.

InterviewUp is Q&A site for job interviews — The site is designed to help interviewers collect challenging questions and interviewees find good answers. We’re not sure the world needs another Q&A site, but a post discussing Google’s interview questions scored over 1500 diggs. If InterviewUp can deliver juicy tidbits like these, it has a shot. For more.

Yahoo’s chief marketing officer Cammie Dunaway leaves – She was head of the customer experience division, and there was no reason given for the departure (details here).

Alibaba Group, 39 percent owned by Yahoo, plans Alibaba.com IPO for Nov. 6th in Hong Kong – The IPO is expected to be the biggest ever by a Chinese Internet company, raising as much as $1.5 billion. Earlier story here from WSJ.

Collective Media, another online ad network, raises funds –The company says it reaches 120 million unique users per month. The round was led by Greycroft Partners, with iNovia Capital participating. More here.

Tumblr, offers you a lean Web site — The New York company offers you a personal site where can collect, share and discuss what headlines and other things found online. It lets you pull in your Twitter feeds, too. Other than that, its has few frills. It has raised $750,000 in a first round of funding from Spark Capital and Union Square Ventures.

Veeker, a mobile video and picture messaging startup, appears to be stuck — The San Francisco start-up raised $2.5 million from Labrador Ventures, but is struggling amid competition.

Tesla’s $1M crash tests — Ouch, at $1M each, no wonder executives at Tesla were gasping at the cost per crash for the testing of the anticipated all electric sports car. Apparently, though, the cost per crash is now a mere $300,000 (Earth2Tech).

Goldman Sachs invests $100M in Israel MobileEye, for driving tool — MobileEye’s technology calculates the speed and distance of a vehicle in front of a car, and alerts the driver when other vehicles are too close. The company raised the money at a pre-money valuation of $500M, reports Israel’s Globes. MobileEye, which has already raised $50M, plans an IPO for next year. The company says that it will have $10M in sales this year and that it will become profitable in 2008. Here’s its statement.

BioFuelBox, biofuel refining startup, raises $9.46M in first round — Backers of the a Hollister, Calif. start-up include Draper Fisher Jurvetson and DFJ Element. PE Hub has the scoop, reporting that the company’s technology is a “bio-refinery in a box — a modular, containerized innovation that produces biofuel cost-effectively and easily.”

GameLayers, a passive multiplayer online game maker, raises $500,000 — The San Francisco company is backed by O’Reilly AlphaTech Ventures, Joi Ito and Richard Wolpert, reports PEHub.Schooner Information Technology, secretive finance company, raises $3.33 million — The company plans a $15 million total first round, according to regulatory filings cited by PE Week. The round was led by CMEA Ventures. The Oakland, Calif., company is led by Richard Busch, formerly with Sun Microsystems as research director of computer system architecture and analysis.

Social networking site for VCs launching next month in Boston – TheFunded lets entrepreneurs talk about VCs. Next month, the New England Venture Network will launch venturenetwork.vc, a place for VC’s to talk about deals. A deals section will feature a Craigslist-like listing of investment opportunities, including a place for VCs to post about companies that are looking for funding, that they chose not to invest in. A questions section will let analysts query VCs. A jobs section will let VCs advertise openings at portfolio companies. Via The Boston Globe.

BlackArrow, a San Mateo, Calif., startup, is offering a new technology to help keep TV advertisers happy.

The company, in secrecy until now, will announce tomorrow (Monday) that it wants to insert targeted ads into on-demand viewing by placing a piece of hardware between cable operators and consumers. Prior to the user watching an on-demand show, BlackArrow helps deliver a brief ad, tailored to the theme of the show and the user’s apparent preferences. For example, a teenage boy might be delivered an ad for an upcoming game like Halo 3.

The company isn’t just another video ad company. It is backed with a $12 million funding round, led by Comcast Interactive Capital, the investment arm of the cable giant.

While DVRs like the TiVo will still allow users to fast forward past advertising, BlackArrow will open up the field for cable companies to profit from acting as remote ad servers. BlackArrow will count on the cable companies to offer their own DVR technology. The advantage for the consumer is not having to worry about buying or installing a hardware DVR. A majority of viewers still haven’t.

BlackArrow is less revolutionary than we’d thought. The company spent more than a year in stealth mode developing its product, and good sources of ours originally suggested that the original aim of the company was to destroy the ad-skipping capabilities of the TiVo. That apparently is no longer the case, if it ever was.

Indeed, the amount of advertising you’ll have to put up with should decrease dramatically, sad CEO Dean Denhart. Advancing standards allow for targeting that is much more valuable to advertisers. Consumers who are dead-set against seeing ads will still be able to rely on their old workarounds.

Like some other advertising startups, BlackArrow can also work with broadband video delivered over the internet. Its best advantage is in its proprietary hardware. The company doesn’t yet have any notable competitors, Denhart claimeed. Large companies like Microsoft, hungry for advertising dollars, are likely to pile in.

Cisco, another investor, has also been testing the company’s equipment. Other investors in the round include Intel, the Mayfield Fund and Polaris Venture Partners. The previous round of $5 million, taken in 2006, was led by Mayfield. The company has raised a total of $17 million. (We’re still trying to reconcile this with our original report that it had raised $14.75 million).

With the profusion of video sharing services on the internet, a number of startups are helping produce professional online content. Every Silicon Valley venture capital firm, it seems, wants to back one.

DECA, a Santa Monica, Calif., studio that calls itself “the best of Hollywood, Madison Avenue, and Silicon Valley,” is the latest to bring professional production values to computer screens and mobile phones.

The company’s initial funding round of $5 million would cover only a fraction of the production costs for a modern Hollywood blockbuster, but its a start. Backers are Mayfield Fund, General Catalyst Partners and Atomico Partners, the fund led by the Skype/Joost co-founder Niklas Zennström. The company is still bare on details, but it says it wants to scout for video ideas, and then develop them, finance them, and distribute them across the Web.

It also wants to use social networking, user generated content and other community features to drive the process. But the company itself will probably not appear in its productions, CEO Michael Wayne told us. “DECA is not consumer facing — consumers may never know what it is. When we fund a project, we bring in producers or production companies.”

In comparison to DECA’s operating model, most internet video companies (YouTube, MetaCafe, etc) have relied on users to submit their own home-made videos, which the companies hope will then go “viral” and spread around the internet. But lately, start-ups like National Banana, Funny or Die, Rockin Cat (see coverage), Crackle (see coverage) and others seeking to produce professional content, designed for viral Internet distribution from the beginning. The model has yet to prove itself.

The best example of someone making a successful viral video is lonelygirl15, a fictional character played by Jessica Rose. The videos became successful enough that the creators were able to parlay their fame into an ongoing series and a company called LG15.

Although DECA is vague on its current plans, Wayne says the company will be making further announcements about its projects in the coming weeks.

WiChorus, a San Jose, Calif. maker of a device giving telecom providers better control of personal data on coming high-powered WiMax networks, has received $15 million in a second round of financing .

The company has been secretive until now, and hasn’t launched yet, but its plans are notable: Its hardware, called an “access services network gateway,” lets a telecom provider track a user’s location, among other things. This way, publishers or other services transporting data over the network can serve more relevant ads to the person, according to VentureWire (subscription required). It also allows the telecom provider to control traffic and manage its services more efficiently.

WiMax networks boost the performance of wireless broadband — WiMax’s range is is as much as 10 miles, compared to WiFi’s reach of a few hundred feet. Sprint and Clearwire are building WiMax networks for use as early as next year.

New investor Mayfield Fund led the round, which included existing investors Redpoint Ventures and Accel Partners. The company has now raised $25 million.

Jaxtr, a service for dodging international calling fees using your phone, has raised $10 million in series A round led by August Capital.

It says it has doubled in size in the last month to a million users.

The Menlo Park, Calif. company (more detail from our past coverage here and here [update: first comment below]) allows you to make free phone calls over the web or your mobile and landline phones, including low local rates for international calls.

When you sign up and make your first call on the web, you get a unique Jaxtr phone number and web address, such as www.jaxtr.com/mattmarshall.

People who want to call you can simply click on the web address link and get directed to your current phone number, as you have it pre-selected on Jaxtr — without you having to reveal your real number.

The company also lets you embed its widget on web pages so you can make or receive calls, say, on your Myspace account; it also launched a Facebook app in late May, but it only has a little over 12,000 users three months later.

Jaxtr has between 70 and 80 percent of its total users making and receiving calls from mobile phones simply because a Jaxtr number can be entered into a mobile address book like any other number, chief executive Konstantin Guericke tells us.

While Skype, Jajah and other internet-based phone services also provide ways to make free international calls, Guericke says this alternative phone number is more convenient for mobile users because they don’t need to download a mobile application, like Skype, or access a web browser, like Jajah. It’s similar to GrandCentral, the company bought by Google, which provides a single number you can use anywhere — although it gives you a single URL instead.

Eighty percent of total Jaxtr users live in 220 countries outside of the US, although Guericke says US users are three times as active, overall.

More than 16,000 users are now registering per day, the company says, with nearly three quarters of users in their 20’s.

Jaxtr was almost acquired recently, Dave Hornik of August Capital tells us — from another private company headed to an IPO (but not Facebook), he says.

While the offer would have been a good return for Jaxtr and its investors, Guericke says Jaxtr took the funding to try to replace the multi-billion dollar industry of selling calling cards with minutes for making international calls.

Jaxtr plans to make money by charging people who use more than their allotted 100 minutes per month; he hopes to get 20 million users in the next twelve months and is planning for only around one percent of these users to pay for additional minutes.

Other returning investors include the Mayfield Fund, The Founder’s Fund and three early Skype backers: Draper Richards, Draper Fisher Jurvetson and Mangrove Capital.

OnStor, a Campbell, Calif. company offering data storage for large companies, is the latest hoping to exploit a turn in fortunes in this once-dead sector. It has just gotten $27 million in more funding from venture capitalists who now have pumped $105 million into the seven-year-old company.

Storage companies are once again filing to public, despite very questionable fundamentals for many of them — but their private investors see a window of opportunity to finally get the companies off their hands. OnStor revealed its revenue growth to VentureBeat (see below), and it’s impressive. However it is still not profitable, it says, something it says will change over the next year.

Q1 2006 = $743,925 Q1 2007 = $3,778,911
Q2 2006 = $952,008 Q2 2007 = $4,322,575

Let’s rewind to 2002. This sector was filled with “walking dead” companies in this sector. After the bubble burst, Internet companies were reeling, the last thing peopled needed was more storage. Or if they did, they didn’t need 165 storage start-ups supplying it. That’s the number of companies venture capitalists funded in the preceding five years, as we cited at the time (sorry, article is long since buried in the Mercury News archives). VCs had pumped in about $2 billion into these companies amid a frantic lemming rush, and now if those companies weren’t dying, they were slashing their workforces in a desperate will to survive.

The need for storage always remained. Big corporations need help storing and securing the vast amounts of data they compile from managing business processes, from supply chains and inventory to customer relations.

Back to 2007. The public markets are doing well (or at least were doing well, until the shocks of recent days), and some storage companies are going public after hunkering down for years. And yet, some of the look worrying still. Isilon Systems, a similar company to OnStor, which went public in last year after $70 million in backing, has suffered recently, announcing greater than expected losses..

OnStor says it has 300 customers. Like other older start-ups, it’s discovering new sales pitches for new times. For OnStor, it’s the “greening of the data center,” in other words, making a company’s data infrastructure more efficient and thereby using less electricity helping save the environment. It does this better than big incumbents like NEC and Netapp, it says.

OnStor says its “storage arrays” offer a 95 percent power savings, 90 percent fewer devices to manage and 90 space savings (!). We haven’t verified this, but it’s a nice pitch, huh, given that many large corporations are issuing “green” mandates to do their part in fighting global warming.

The funding comes from Sand Hill Capital and existing investors Foundation Capital, Mayfield Fund, ComVentures, and Worldview Technology Partners. They’ve called this a “mezzanine” round, a term used as a clear signal to the market that this is the last round before going public.

The Taneja Group, a third party research group, is about to finish a white paper for OnStor about the greening of the data center.” It’s due out any day, and we’ll be interested in seeing what it says.