E-mail specialist M3 Technology Group raised $6.5 million

E-mail specialist M3 Technology Group raised $6.5 million in expansion funding from Charlotte, N.C.-based Frontier Capital in the first outside equity investment in the five-year-old company's history.
The new investment will allow M3TG to expand new deployments and ongoing service of enterprise class e-mail systems featuring customized access, security and reliability features.

The new capital gives Charlotte-based M3TG a post-money valuation of $21 million and is expected to be the final outside equity the company will raise.

M3TG founder and CEO Michael Byrnes said the company has been profitable since its inception in 2002 and that he has rebuffed previous offers of expansion capital in favor of internal growth. But the company currently has annual sales of about $12 million, and Byrnes said he saw an opportunity to accelerate growth with additional capital as more companies require customized e-mail deployment and maintenance.

"When we started, we saw that e-mail was the heartbeat of any corporation and saw an opportunity to put a laser focus on that," Byrnes said. "Because it has become so mission critical, more companies recognize that it has to be up 100% of the time and has to be monitored for security and reliability."

Andrew Lindner, managing partner of Frontier Capital, said the firm had been following M3TG since its formation. Frontier was attracted by the capital efficiency the company demonstrated in building sales above $10 million and saw opportunity to bring capital and management experience to maintain growth, which has averaged around 50% annually.

"As e-mail systems get more complex when you add mobile devices and they become even more critical, companies increasingly need somebody to manage systems," Lindner said. "We like their scrappiness in getting to where they are on bootstrap financing, but this capital will allow them to hire bodies ahead of the curve and to build out the management team, and with extra cash on their balance sheet they can be more disciplined in the customers they take on and on pricing."

Byrnes said M3TG currently has about 100 employees, with operations throughout the U.S. and Europe, and he said there would be no need to make acquisitions for geographic expansion. He said the company will use the new money to fund product development initiatives, to expand its professional and enterprise services teams and to boost sales and marketing.

"Over the past two years, we have experienced phenomenal and consistent growth. In the process, we have become a go-to partner for some of the most trusted and influential technology companies in the world," Byrnes said. "With this round of funding, we will be able to add more resources to enhance our innovative technology processes, build out our operations and increase the testing and implementation of new technology solutions that continue to improve the way our communications information is stored, secured and delivered."
More at:http://www.m3tg.com/