Huddle Lands $51 Million D Round

Huddle, the enterprise cloud collaboration service, has landed a $51 million D round, bringing total investment in the London and San Francisco based company to $89 million, the company announced Thursday.

Mitchell: IPO ‘a couple of years off’

The round was led by Zouk Capital, a London-based private equity company that typically specializes in cleantech, with participation from the Hermes GPE Environmental Innovation Fund, managed by Hermes GPE. Nathan Medlock, a partner in Zouk’s Growth Capital Team, has joined Huddle’s board.

Existing investors, including London-based Eden Ventures as well as U.S.-based Matrix Partners, DAG Ventures and Jafco Ventures, also participated in the round. The company has also received investment from In-Q-Tel, the VC arm of America’s Central Intelligence Agency.

No valuation of the company was given. The company’s last funding round was a $24 Million Series C Round on May 24, 2012.

IPO plans

According to CEO Alastair Mitchell, who co-founded Huddle alongside Andy McLoughlin in 2006, the money will be used to continue the company’s global expansion and double the size of the product team. Despite Mitchell saying two years ago that an IPO was “on the plan perhaps in a couple of years,” he said there was no immediate plan to go public.

“We are still working away at it,” he said. “It is still a couple of years off. We don’t have to go out early and we will chose the time when the markets are ready. We are not there yet.”

CIA Backing

Mitchell said having the CIA’s In-Q-Tel on board as an investor had opened up “the entire US government market. They are a very helpful partner in that process. This is a multi-billion [dollar] space.”

About 30% of Huddle sales are in the public sector in both the U.S. and UK with a small number in the Far East and in Europe, Mitchell said. The company is a major supplier to the UK government’s G-Cloud. That figure is up from about 20% two years ago. According to Mitchell 30% is typical of large software companies.

UK Ministry of Defence

Nathan Medlock, a partner in Zouk’s Growth Capital Team, joined the board of Huddle back in July according to data from Companies House. Medlock, a former British Army officer who has previously worked for the failed U.S. bank Lehman Brothers as well as time as CEO of a Swedish mining company and CFO of a U.S. biotech company, also spent five years working for the UK’s Ministry of Defence as “an analyst on the Middle East … and a staff and liaison officer.” Medlock declined to go into detail.

Huddle’s Chief Financial Officer John Quarles served with the US Navy’s SEAL special forces unit.

Although Zouk has invested in payments company iZettle, most of its portfolio is in cleantech. According to Medlock, Huddle fits in with its general strategy. “Zouk’s investment focus is resource efficiency – the ideas of doing more with less,” he said in an email reply. “Resource efficiency is a mainstream technology concept which covers most sectors of the global economy. Huddle is cloud based, secure external collaboration software that improves productivity and reduces server costs and energy usage, which positions it squarely within Zouk’s resource efficiency strategy.”




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