Backup Service Providers Swell

Online backup service providers are on a roll: As AmeriVault announced a small round of funding today, competitor LiveVault Corp. said it's the first company in this space to support Microsoft Corp.'s (Nasdaq: MSFT) Windows Server 2003 (see AmeriVault Pockets $1M Funding and LiveVault Recovers Win2003).

First AmeriVault, based in Waltham, Mass., announced today that it has received a staggering $1 million in funding. The pocket change comes from the startups only current investor, Boston-based Alta Communications, which has already handed over $6 million to the company.

"They continue to make good progress and continue to grow," says Lane MacDonald, a general partner at Alta. "We’re just happy to support them... They don’t need any more funding beyond this capital."

Although $1 million may not be the most impressive sum, AmeriVault, which was founded in 1998, is in one of the only categories of storage companies that are getting any funding at all these days: online backup service providers. Since the beginning of 2003, AmeriVault, Arsenal Digital Solutions Worldwide Inc., EVault Inc., LiveVault, and ManagedStorage International Inc. (MSI) have raised a combined total of $49.5 million (see Arsenal Restocks Its Coffers, Startups Tap VC Reserves, LiveVault Locks in $10M Series B, EVault Raises $6M Series C, and MSI Springs on $22M).

AmeriVault, which has about 350 customers, claims it’s already cash-flow positive and only needs the additional cash to help it launch new replication and high-availability services by the end of this year. "This fully funds our business plan," says AmeriVault CFO Brian Jacobson. The company has no immediate plans to add to its headcount of 30 employees, he says.