Austin’s Volusion raises $55 million, preps for IPO

Jan 30, 2015
Austin American Statesman

Fast-growing Volusion Inc. has raised $55 million to expand its e-commerce software business and ramp up for an IPO

The Austin-based company received the funding from Houston-based Main Street Capital Corp

Founded 11 years ago, Volusion develops software that lets merchants build online stores. They can update product information, offer online coupons, handle credit card transactions and track inventory all in one place

Customers also can add online stores to their Facebook pages and offer daily online deals

Volusion has traditionally targeted small and mid-sized businesses, allowing mom-and-pops to quickly set up a website and begin selling their products

Last year, Volusion launched a new e-commerce platform called Mozu to target large merchants. CEO Clay Olivier said Mozu, which the company spent $50 million to build, has beaten out offerings by major players including Oracle, eBay and SAP to win new clients

Mozu customers include Jelly Belly, online fashion retailer Bluefly and fitness gear maker GoRuck

“Supporting Volusion’s vision as they generate significant growth with the Mozu platform is a natural fit for us,” said Dwayne Hyzak, senior managing director of Main Street Capital. “Not only do we look forward to Mozu creating even more waves in the enterprise commerce space, we are very excited about the opportunity to expand Volusion’s proven model of success and profitability.”

Originally based in both Simi Valley, Calif., and Austin, Volusion consolidated its offices in Austin in 2011

The company has 450 employees, most of them at the company’s headquarters on Kramer Lane in North Austin.Volusion added 200 employees last year and plans to add up to 150 new workers, primarily in development and professional services, in 2015

During its first 10 years, Volusion turned down venture capital, saying the company was profitable and officials didn’t want to dilute employees’ stock options

Last January, in a deal that allowed Volusion to grow without giving up ownership, the company received $35 million in debt financing from Silicon Valley Bank

Now, the company has decided to raise private equity to accelerate Mozu’s growth, Olivier said

“There are different strategies at different times,” Olivier said. “At this point we’re comfortable taking on equity because of where we are in the marketplace and where we’re headed.”

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