New Round Led By Split Rock Ventures and Rho Ventures; Capital Will be Used to Accelerate Company’s Leadership Position in Carrier-Delivered, Location-Based Mobile Applications
MINNEAPOLIS – February 21, 2007 – Gearworks, a leading provider of location-based mobile business applications, today announced it has raised $21.4 million in growth capital. New investors Split Rock Partners and Rho Ventures led the financing. Michael Gorman of Split Rock Partners and Ben Terk of Rho Ventures will join the company’s board of directors. Bluestream Ventures, an early supporter of the company, increased its position through this financing.
“This capital comes at an exciting inflection point for Gearworks and will enable us to drive growth by expanding our products, sales channels and wireless carrier partnerships,” said Todd Krautkremer, president and chief executive officer of Gearworks. “I’m pleased our business has garnered the support of Split Rock Partners and Rho Ventures, and I look forward to their collaboration as we build Gearworks into a location-based, mobile application powerhouse.”
Gearworks provides on-demand mobile applications that enable businesses of all sizes to cost-effectively supervise and optimize their mobile workforces and field-based activities. By delivering its Software-as-a-Service (SaaS) solution across the internet and on a monthly subscription basis, customers can start using it right away to better manage their mobile workforces without significant upfront costs and complexity. Gearworks partners with wireless carriers across North America that distribute and bill for its mobile applications under the etrace® (e.g. Sprint® and Southern Linc) and carrier-labeled brands.
The market for handset-based LBS (location based service) applications is forecasted to grow significantly over the next three years, and Gearworks believes it is well-positioned to take advantage of this growth. According to a recent study by ABI Research, worldwide carrier deployments of LBS handset applications will top 144 million subscribers by 2010, with 76 million expected to be deployed within business customer environments. Since the launch of its carrier-driven strategy in 2004, Gearworks has secured more than 2,500 customers, including some of the nation’s leading service-oriented brands like Pepsi Bottling Group, Select Comfort and Roto-Rooter. In 2006, Gearworks achieved more than 152 percent year-over-year growth in new deployed mobile users.
“Rho has been following the emergent LBS mobile business application market for several years with keen interest and believes Gearworks is best positioned to win based on its team, technology and traction with wireless carriers in North America,” Terk said.
“By combining off-the-shelf mobile applications with a carrier-grade application delivery platform that enables rapid development of new and carrier-branded solutions, we believe Gearworks is poised to become the leading provider of carrier-delivered, LBS mobile business applications,” Gorman said. “Gearworks has established a phenomenal foundation from which to build upon.”
BlueStream Ventures is an early-stage investor in Gearworks and current board member Travis Winkey, managing partner of BlueStream Ventures, commented, “With this round of funding and the resource and relationship assets that Split Rock Partners and Rho Ventures bring to the table, Gearworks is in a great position to capitalize on its momentum and accelerate growth.”
Gearworks (www.gearworks.com) provides location-based mobile business applications – in collaboration with wireless carriers – that enable customers to better manage their mobile resources. Today, Gearworks-powered solutions are used by service-driven companies of all sizes to supervise and optimize their personnel and activities in the field as easily as they do in the office. The company partners with leading wireless carriers across North America for distribution and billing, and leverages its carrier-grade, Software-as-a-Service (SaaS) platform to ensure high reliability and a seamless customer experience. Gearworks’ mobile business applications serve thousands of small-to-medium sized business and enterprise customers across a broad range of industries — including construction, healthcare, field service, home and store delivery, utilities and government services.
About Split Rock Partners
Split Rock Partners, with offices in Minneapolis and Menlo Park, seeks emerging opportunities in software, internet services and healthcare primarily in the Upper Midwest and West Coast. Split Rock Partners was formed in June 2004 by the software and healthcare investment teams of St. Paul Venture Capital and continues to manage St. Paul Venture Capital’s existing software and healthcare portfolio. Representative software and internet services companies in the Split Rock Portfolio include Compete, LowerMyBills (sold to Experian in 2005), SPS Commerce, and QuinStreet. In May of 2005, the firm announced the closing of Split Rock Partners L.P, a $275 million venture fund. Additional information about Split Rock Partners can be found at www.splitrock.com.
About Rho Ventures
Rho has been backing venture-stage companies in the U.S. since its inception in 1981. Venture capital funds under management currently exceed $1 billion. Rho Ventures has invested in over 165 venture stage companies and helped build market leaders across many high growth industries. Previous investments include Ciena Corporation, Commerce One, Compaq Computer Corporation, Diversa Corporation, Human Genome Sciences, Inc., iVillage, Leukosite (currently part of Millenium Pharmaceuticals), MedImmune, Inc., NitroMed, Senomyx, Tercica, Tripod (currently part of Lycos), Vanda Pharmaceuticals and Vicuron. More information on Rho can be found at www.rho.com.
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