FOSTER CITY, Calif.–(BUSINESS WIRE)–June 30, 2003–BA Venture Partners, a leading venture capital firm, today announced it is actively seeking new deals with companies offering software as aservice. “Software as a service” is an application delivered to customers over the Web from vendor-hosted infrastructure as opposed to traditional software licensing models that put the burden oncustomers. Leveraging its success as the lead investor in PlaceWare Inc., which was recently acquired by Microsoft, BA Venture Partners is looking to extend its presence in this increasingly highgrowth, profitable and attractive market.<\/p>\n
“Our successful exit on the PlaceWare deal has intensified our focus on the “software as a service” market and we are aggressively pursuing and looking for new companies in this space,” said Rory O’Driscoll, managing director at BA Venture Partners. “We were active investors in PlaceWare and supporters of this model since 1999 because we believe it is an attractive model for companies trying to control costs and improve their bottom lines.”<\/p>\n
Advantages for Customers<\/p>\n
Software applications offered as a service deliver a number of advantages over traditional software licensing models. Customers, typically business executives, do not need to rely on IT to spec, purchase, implement and integrate diverse technologies to deliver a solution. Businesses save money by eliminating maintenance, service and training agreements while reaping the benefits on instant access to the service with the flexibility of paying only for the amount of services they use on an ongoing basis.<\/p>\n
Advantages for Investors<\/p>\n
The “software as a service” business model is attractive to BA Venture Partners for several key reasons. Portfolio companies can gain customer acceptance rapidly based on low entry costs, relatively fast sales cycles and quick implementations. Service providers can build a predictable book of business and grow revenues with increased customer penetration. As fixed infrastructure costs of hardware and software have declined, and as scale increases, companies in the “software as a service” sector benefit from gross margins comparable to the traditional software licensing model, but without the margin drag of costly professional services.<\/p>\n
“Our specific focus on this market has allowed our software group to invest in two companies that offer “software as a service” already this year, Biz360 and Bellamax,” said Sharon Wienbar, director at BA Venture Partners. “Both of these investments were competitive deals with other venture capitalists and one of the key reasons the companies chose to work with us is because we have experience in the space, we understand it and most of all, we don’t try to change who or what the company is. We don’t try to convert them into the traditional software licensing model.”<\/p>\n
Key software as a service sectors where BA Venture Partners actively seeks new investments include business applications such as: sales\/marketing; collaboration; analytics; and customer service to name a few, as well as applications for end-users such as: communications\/messaging; media; games; imaging; and advertising.<\/p>\n
About BA Venture Partners<\/p>\n
BA Venture Partners, a venture capital partnership, leads start-up to expansion stage investments in networking, semiconductor, software, medical technology and biotechnology companies. The firm closed BA Venture Partners VI, a $500 million fund, in 2000. BA Venture Partners’ sole limited partner is Bank of America. Visit their website at www.BAVenturePartners.com.<\/p>\n","protected":false},"excerpt":{"rendered":"
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