Cloud services firm Cradlepoint raises $89 million funding from TCV

Cradlepoint, which sells routers and services for cloud-managed networks, today announced that it has received $89 million from new investor TCV. With cloud, mobile, and the Internet of Things (IoT) exploding, the need for businesses to manage these networks is keeping pace. Cradlepoint has already sold 1.4 million devices worldwide to help address this growth.

“As more traffic shifts from private MPLS (multiprotocol label switching) networks to the public Internet, and from wired to wireless access, legacy WANs (wide area networks) are falling short from a connectivity, security, and cost perspective,” wrote Cradlepoint CEO George Mulhern, in an email to VentureBeat. “Connected enterprises require a next generation WAN that is software-defined, cloud-agile, and wirelessly-pervasive.”

The company’s 4G LTE routers, which are powered by the Cradlepoint NetCloud, serve 15,000 customers across multiple industries, claims Mulhern. These include retail, transportation, education, healthcare, financial services, and insurance. Customers purchase the router and buy a subscription to the company’s cloud-based network management tools in either one, three, or five-year increments.

Mulhern considers Cisco his primary competitor, but he also views SD-WAN players — VeloCloud, Viptela, Silver Peak, and CloudGenix — as competing for the same market. “But they are focused only on branch networking and offer consumer-grade 4G LTE support,” he wrote.

TCV has participated in more than 100 initial public offerings (IPOs) and strategic acquisitions, and its new involvement with Cradlepoint begs the question of whether the company is on the brink of an exit.

“Our goal is to create an IPO candidate company because if we have the customer loyalty, market success, and financial performance to support doing an IPO, we will have a good outcome whether we do an IPO or some other form of exit,” Mulhern wrote.

Ted Coons, general partner at TCV, and Doug Gilstrap, venture partner at TCV, have both joined Cradlepoint’s board of directors. No other investors participated in this round.

Cradlepoint has raised a total of $157 million since its foundation in 2006. The new cash will be used for continued sales expansion and to further product development in advanced 4G and 5G wireless broadband, Software-Defined Networking (SDN), and enterprise Internet of Things (IoT).

Headquartered in Boise, Idaho, Cradlepoint has 450 employees worldwide. Office locations include Silicon Valley, Canada, the U.K., Australia, and Japan.