by Clifford Carlsen
[Posted on January 23, 2008 - 5:34 PM]
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DiggOnline meeting software maker Unisfair Inc. took advantage of the convergence of virtualization technologies from the gaming industry and the growth of online social networking to raise $10 million in a Series B funding led by Norwest Venture Partners of Palo Alto, Calif. Norwest was joined by previous investor Sequoia Capital of Menlo Park, Calif.
The round brings total funding in the seven-year-old company to about $19 million and is expected to take the company to profitability in 2009.
Unisfair rode strong adoption by enterprise customers including San Jose, Calif.-based Cisco Systems Corp., National Instruments Corp. of Austin, Texas, and Ottawa-based Cognos Inc.; along with early conference industry users including Manhasset, N.Y.-based CMP Media LLC, Toronto-based Rogers Publishing and New York-based Penton Media Inc. to land the funding round, which it believes will solidify its lead in hosting online "virtual events" as an alternative to large, actual, live, corporate or industry meetings.
Unisfair founder and CEO Guy Piekarz founded the company in 2001 to leverage the Internet and new media technology to offer hosted meetings, extending early efforts of trade shows to bring their offerings online. The company introduced its first product offerings in 2002, but Piekarz
said developments in technology for virtual worlds and in business networking trends have accelerated Unisfair's growth dramatically in the last three years.
"When we started it was mainly with a vision that this would be the way to do business powered by the Internet," Piekarz said.
"There were some Web sites that supported physical trade shows, and some 3-D engines for gaming, but we combined three trends in virtual worlds, social networking and Web conferencing," he said.
Unisfair hosts meetings of typically 3,000 to 4,000 users in a graphic environment similar to virtual worlds such as those inhabited by online game players. The virtual events house displays such as those that would be included in physical trade shows, and feature social networking capabilities to connect visitors to facilitate the type of networking that goes on at trade shows and corporate events.
Piekarz said the company aimed its products at event producers looking to save money on travel expenses and lost work time devoted to attending physical events, but that it also has benefited from increasing awareness of the environmental costs of staging and attending large shows.
Unisfair was founded in Israel and raised about $4 million from BCS Growth Fund (Israel LP), as well as individual angel investors, before raising $5 million from Sequoia in June 2006. Piekarz said the company
established its U.S. headquarters in Menlo Park shortly after that funding and the company targeted U.S. investors in the current round.
Piekarz would not disclose a valuation for the current round but said it came at a substantial increase to the 2006 round, reflecting a 350% growth in the number of events hosted by its customers last year.
Shmil Levy, an Israel-based partner with Sequoia Capital, said that the firm believes virtual events will have a large impact on the way companies conduct business by eliminating travel demands, and that Unisfair is the recognized leader of virtual events for businesses. "With its proven technology and growing customer base, Unisfair is on a path of continued success and leads the market in this important category," he said in a statement.
Unisfair did not use an outside adviser in raising the round and had legal work on the deal from Donna Petkanics of Wilson Sonsini Goodrich & Rosati PC in Palo Alto. Investors were represented by Cooley Godward Kronish LLP in Menlo Park.
