The venture capital firm launched by former Quest Software Inc. Chief Executive Vinny Smith has invested in its second local company.
Toba Capital last week joined SAP Ventures in Palo Alto in a $12 million second round of financing for Irvine-based Alteryx Inc., a fast-growing software company led by industry veteran Dean Stoecker.
“We are investing and looking to help him push his company to a national and international leader in analytics,” said Smith, who cashed out some $800 million last year after Dell Inc. acquired his Aliso Viejo-based business software maker for $2.4 billion. Smith wasted little time in establishing Irvine-based Toba with former Quest colleagues after the deal, setting out to invest in the “next generation of IT infrastruc- ture.”
Alteryx seems to fit the bill.
The company develops data analytics software and has earned a roster of notable clients in the retail, restaurant, financial, real estate and telecom sectors, among others.
Information services company Experian PLC, which has its North American headquarters in Irvine, uses Alteryx’s software to integrate data and monetize content on its family of websites.
Lake Forest-based Mexican-style fast-food chain Del Taco Holdings Inc. uses its product for financial and human resources analytics. Walmart and Best Buy use the software to forecast sales at existing and future locations, allocate space in stores, and map out expansion plans.
The software also allows retailers to compare sales and product placement across departments and analyzes whether certain products will sell better on shelves in Garden Grove or Newport Beach, for instance.
“We humanize big data,” Stoecker said. “There needs to be a place to store this big data, and you have to have an analytics platform that allows business users to get it.”
Alteryx has hundreds of customers in the U.S. that pay a subscription fee to use its software.
Marlborough. Mass.-based tech industry watcher Wikibon estimated Alteryx’s annual sales at $36 million in 2012 and ranked it No. 9 among global companies that derive all revenue through big data services and products.
It pegged global sales in that emerging segment at $11.4 billion last year, up 59% from 2011. Revenue is forecast to grow at a 31% clip annually through 2017 to $47 billion.
Alteryx projects a similar percentage spike in its sales this year.
The company was founded in 1997 as SRC LLC and took the name of its core product in 2010, a common move in the software industry.
Alteryx doubled its workforce last year to about 130 people, with most based in the company’s tech center in Boulder, Colo., near Stoecker’s hometown of Bloomfield in suburban Denver. It has about 20 employees in Irvine, which is pegged to grow headcount, with an inside sales team in the works and an existing 15-person marketing team in San Mateo.
The company has raised about $18 million to date.
The latest investment primarily has been earmarked to fuel growth through added sales, marketing and products, along with expansion plans in Europe.
The Alteryx investment is at the least the sixth for Toba, which has participated in funding rounds that have raised a combined $49 million.
“They’re going to bring great operational insight,” Stoecker said.
The venture firm, which has established outposts in New York, Texas and Minnesota, has been the lead investor in at least four deals.
The latest funding round was split between Toba and SAP Ventures, an investor in 2011.
In December, the Business Journal reported that Toba led a $4.5 million funding round for Irvine-based security software maker SecureAuth Corp. in its first Orange County play.
