With 40 Million in the Bank Meraki to Expand
July 17, 2012
Josh Constine of Tech Crunch recently reported on wireless provider Meraki’s plans for expansion in the article “Meraki Plans to Conquer Enterprise Wi-Fi, Hire Like Crazy With $40 M in New Funding.”
According to the article, Meraki, a retailer of wireless LAN devices, security appliances, and the cloud architecture software, is using the $40 million that it has raised from investors and debt financing to keep a cash cushion, pay for its new headquarters, and aggressively hire in sales so it can break away from competitors.
“A source close to the company says Meraki was spending around $65 million a year, and Q2 2012 saw the company rake in over $20 million — more than it was shooting for. The $40 million cushion will protect it in case expenditures rise for supporting its 20,000 customer networks or if it wants to rapidly pursue a new market as it competes with dedicated companies like like Aerohive and giants like Cisco.”
Our own Stephen Arnold, wrote about Meraki back in 2010 in one of his for fee columns “Google Broadband: Is There an Enterprise Angle?” At that point, the company was an unknown start-up that had received interest from Google.
After discussing the pros and cons of Google investing in Meraki and offering high-speed wireless connectivity with bundled applications at a competitive price, Arnold concludes:
“Another likely impact is that telecommunications companies, network equipment vendors and enterprise software vendors like Microsoft, Oracle and their partners will have to respond. Increased competition is often a benefit, setting off even more innovation. Bottom line: Google, Kansas, may only be the tip of a large, virtual iceberg floating in the cloud drifting toward the enterprise.”
Fast forward two years and it appears that Meraki is preparing for the very competition that Arnold predicted. Funny how things come full circle.
Jasmine Ashton, July 17, 2012
Sponsored by PolySpot