Today CloudRail, a current Bolt Capital portfolio company, announced the the closing of a €540k seed round of VC investment from a terrific set of value-add partners in Leonardo Venture, Beteiligungsfonds Wirtschaftsförderung Mannheim GmbH, and strategic angels. This funding round provides an opportunity to highlight why Bolt Capital is excited about CloudRail.
1. Large Problem. CloudRail is tackling the interoperability facing the Internet of Things (IoT) industry. This problem has plagued many technology sectors before, forcing developers to hard code stitch applications and devices together; or use expensive, bloated middleware that 'never really works'. Interoperability issues are going to be 1000's times more complex in IoT due to the number of vendors, different data formats, and lack of standards. Vendors and software developers alike won't be able to realize the value for users until they can dynamically and automatically connect multiple ecosystems together.
2. Real Pain. Creating a vibrate ecosystem around a product can be an essential requirement in driving growth, sustainability, and market share. While the ecosystem is critical it is not the core features of a product. Thus the problem lies is deciding how to allocate engineering resources to support the ecosystem versus core product features...on initial release, future releases and sustaining engineering.
This was one of the major issues faced at the last company I co-founded called PacketTrap Networks (acquired by Dell). PacketTrap's customers required a connected ecosystem of products so they could truly automate IT service delivery. But vendors considered the integrations a checkbox feature not a priority feature. Thus many of the integrations were hacks in hopes of satisfying the customer need. But customers were never happy with the integrations. They broke, were incomplete, and barely maintained. Vendor on the other hand felt they spent way too much engineering time on with one off efforts building and maintaining the connections. No standards, poor communication amongst vendors, no incentive. It got to the point where 50% of PacketTrap's development team was on fixing and maintaining 'incomplete' integrations. (This is pain!)
3. Talented People. Co-founders David and Felix graduated for the local university in Mannheim, Germany. Prior to CloudRail, Felix and David learned the ropes at various technologies companies including Deutsche Telekom. In addition they have built a product called licobo that attempted to aggregrate and organize contact information from multiple address books. The licobo product had very similar challenges we faced at PacketTrap. Connecting disparate applications and ecosystems together. After many meetings and whiteboard sessions on the technology, I realized they had a very unique approach to the problem. These guys are smart, think outside the box, and think big.
Bolt Capital is proud to be working with CloudRail, helping them connect the unconnected.
Read more about the funding here.