For the transaction of the week we highlight Kentik, a provider of a network monitoring platform who announced a $23.5 million investment round led by Vistara Capital Partners
. This round brings the company’s total amount of funding to $61.7 million. Ketnik’s
platform enables customers to monitor the performance of their networks across the Internet, inside their own data centers, and/or in public clouds.
Kentik’s platform is capitalizing on a trend that we have highlighted in this section
before; network visibility. To optimize performance and security of any enterprise network IT operations teams need quality data and analytics in as close to real-time as possible. Kentik is focused on the performance side of the equation and that has never been more important due to the increase in internet traffic stemming from the Covid-19 pandemic. Enterprises need to ensure their web assets and SaaS apps are performing at a high level to ensure customer experience. The company has been successful capitalizing on this value proposition, as revenue has been growing 100% year-over-year since its founding 2015, and current customers include IBM, Zoom, Dropbox, eBay, Cisco and GoDaddy.
An additional interesting piece of this funding reported by TechCrunch
is that a portion of the capital was via growth debt. York IE
has written before on how startups should be sure to evaluate all the different ways to finance their business and choose the most responsible way. In this case, it is easy to assume that Kentik has achieved a financial profile that enables them to take on debt with attractive interest rates. This will help reduce the dilution from the round of financing leaving more equity in the hands of the founders and employees.