Andy McLoughlin: We took some angel money quite early on from a guy that I worked for. Charles McGregor had a business called Fibernet in U.K., which he eventually sold to Global Crossing. Bucking the trend in the U.K. where angel investments wasn’t a big thing, he bet his cash on us and that allowed us to accelerate the business. A year after that, we closed our first round of venture funding, which was led by Eden Ventures, which is an early-stage VC fund based in the U.K.
Sramana Mitra: How much was the first round?
Andy McLoughlin: First round was $4 million.
Sramana Mitra: You said you’ve raised $40 million. Has it been mostly from the U.K.? Have you then been raising money in California as well?
Andy McLoughlin: We raised our B round in early 2010 and that was led by Matrix Partners by Josh Hannah. That was when I moved out here. Our C round was done in the middle of 2012 and was led by Jafco with participation from Matrix, DAG, In-Q-Tel who are colloquially known as the venture of the CIA, and Subrah Iyar who was the founder and CEO of WebEx.
Sramana Mitra: WebEx was my client.
Andy McLoughlin: Interesting. After the first round, all of the money has been led out of the U.S.
Sramana Mitra: That gives us good context. Help me position Huddle. For a minute, let’s role play. Think of me as your investor. Help me understand the competitive landscape. Of course, it’s a very crowded space. It seems like you’ve found a positioning within that’s working. Explain to me what that is.
Alastair Mitchell: There are two mega trends at play in the software industry at the moment. One of them is cloud and with that comes mobile. The other is social. Those two trends are closely related. Basically, people are looking to share information and work together in new ways. They don’t want to be restricted to laptops and desktops. They want to work on mobile devices and they want to work on a much more social and collaborative way than they did before. You bring those two trends together and what is being demanded now by enterprises is a new platform – a new IT toolkit that helps them to do this. That’s the market that Huddle serves.
It’s a huge market. There’s everything from file sharing and storage in the cloud to social tools. Some very big businesses are being founded and built taking on Microsoft. Huddle is at the intersection of those two markets. We provide a platform for people to store and share information in the cloud and access it from any device. It also allows to collaborate on that content in a very easy and social way. We are used as a replacement for traditional systems like Extranet and Intranet. Sharing and working on information very securely in the cloud, primarily externally, is a particular niche and strong area where we’ve become a leader.
Imagine you are a lawyer’s firm, an accountancy firm, a government department, or a marketing agency and 90% of what you do is actually outside of your company. It’s not with your colleagues; it’s with your customers, partners, stakeholders, and suppliers. There are no tools to work with those people apart from email. We all know how that is. When you leave the office and get on a plane to go to a meeting with a client, there are no tools to access information once you leave that office. So what Huddle does is provide a really secure way in the cloud to access your information no matter where you are, and then share and work on that with anyone you need to.