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Networking - Monday, December 21, 2009

Wireless Networking's Meru Files $86M IPO

Meru Networks files for an IPO worth up to $86.25M in common stock. The wireless LAN company in the past month retooled its exec team, adding SVP of Marketing Ram Appalaraju and SVP of Worldwide Sales Glenn Cross.

Meru was founded in 2002 and has had its hear set on an IPO for at least the past two years. Its rival Aruba Networks had a nice IPO in March 2007.

Meru's products pool wireless LAN resources into a single virtual cell that can span a whole office or campus. We understand the market is hot now as final approval of the IEEE 802.11n specification in September helped release demand for wireless LANs in enterprises. Sales to enterprises rose about 20 percent between the second and third quarters of this year and continued to rise into the current quarter,

Meru reported $50.24M in revenue for the nine month period ending in September 2009, with a net loss of $9.43M -- up from the net $24.6M loss from a year earlier. Meru has done well selling to corporations but given various stimulus funds that have gone to schools and health care, it is also selling well in those sectors as well.

Meru has raised a total of $116M to date including a Series E round this year that weighed in at $57M.

Earlier in 2009, Meru raised $30M in private equity funding led by Vision Capital Advisors. Prior investors include Clearstone Venture Partners, NeoCarta Ventures, The D.E. Shaw Group, Evercore Partners, BlueStream Ventures, Monitor Ventures and Tenaya Capital. The startup was co-founded by Dr. Vaduvur Bharghavan, who remains the company's CTO.

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