Volusion raises $35M in debt financing from Silicon Valley Bank
Austin, Texas-based Volusion has secured $35 million in debt financing from Silicon Valley Bank, VentureBeat reported. Volusion is a platform that allows merchants to set up their ecommerce stores online. The proceeds from the debt round is the first ever external funding that Volusion undertook since the company was began in 1999.
The report said Volusion has typically focused on small and medium sized enterprises that seek to bring their operations on the internet. In September, however, Volusion Chief Executive Officer Clay Olivier said his firm intends to compete in the enterprise market as well. This is where their latest product called Mozu will play a role. Mozu's API-first architecture makes it easy for clients to customize and integrate with other software and applications. The product is already available, the report said.
Online store building is not Volusion's only offering. It also helps clients with search engine optimization, order management, marketing and payments processing.
Last year, the estimated 45,000 merchants on the Volusion platform were able to process sales of over $2.8 billion. The company is a rival of Shopify which recently gathered $100 million to venture into physical retail. Volusion's other competitors also include BigCommerce and LightSpeed Retail, the report said.
Citing a company representative, the report said that the fundraising could open doors to a potential initial public offering in the future. A Volusion representative told VentureBeat, "With this funding, we are looking to launch and market our new enterprise platform, Mozu, while also further developing and enhancing the Volusion platform, which is built for the SMB market. The financing allows us to disrupt the enterprise commerce market and continue to grow our team."
In a TechCrunch report, CEO Olivier was quoted as saying that Volusion decided to raise debt in order to add value from investors without dilution. Olivier added that the credit facility will be utilized for the marketing and expansion of Mozu and prepare the firm for a possible IPO, perhaps next year.
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