Acton Firm Gets $18M, Looks For New Customers
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Eric R. Schnadig, CEO of Acton-based Tervela Inc.
Eric R. Schnadig, CEO of Acton-based Tervela Inc. has raised $18 million in venture capital so it can expand into new markets with its hardware-accelerated computer messaging systems.
The company’s existing customers are investment banks, hedge funds, automated trading houses and exchanges, and other data-intensive companies that need to move data around quickly and reliably to complete hundreds and thousands of transactions.
Tervela’s product addresses the information bottleneck in data centers with its combination of hardware and software, which speeds up the movement of data within applications. This can be crucial for financial institutions where time really is money.
“There’s a market opportunity here, and our investors see that,” said Eric R. Schnadig, Tervela’s CEO, who was appointed two weeks ago. “This is obviously a sizeable investment by blue chip investors, and there’s a lot of excitement around that.”
The investors were Goldman Sachs of New York City, Sigma Partners of Boston and Silicon Valley, Acartha Group of Missouri, and North Hill Ventures of Boston.
Looking For New Markets
The new infusion of money will be used in part to crack other markets, such as telecommunications, Schnadig said. The company is also investigating video gaming applications as well as government and health care sectors, he said.
“In telecommunications you’ve got huge data challenges...” Schnadig said. “We have some customers that are using Tervela to configure and send applications to millions of set-top boxes simultaneously.”
The potential of breaking into those other markets interested at least one investor.
“Any time you establish a beachhead in financial services with impressive results, it makes it easier to enter other vertical markets,” said Robert Davoli, a partner at Sigma Partners.
Tervela’s engineering and corporate headquarters are in Acton, where two thirds of its 50 employees are located. The remaining workers are in New York City, in sales and service positions for Wall Street customers.
Hardware v. Software
The company’s product is successful because it uses hardware to solve the increasingly common problem of moving around huge amounts of data quickly and consistently.
“Hardware delivers faster performance in terms of speed and throughput,” Schnadig said. “Equally important is reliability.”
Hardware breaks less often than software and there are more reliable options to fix it, he said.
Hardware is better able to expand a system over time, as well.
Schnadig hasn’t been with the company long, but he already envisions a promising future for it.
“I see the opportunity to build a significant company that has hundreds of customers and hundreds of employees, and that solves challenging application problems,” he said.
Despite Tervela's success, venture capital investments have been down. Venture capitalists invested $5.27 billion in 595 deals during the second quarter, a steep drop from the $8.33 billion and 726 deals recorded during the second quarter of 2008.
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