Networking start-up raises $59 million

Networking start-up Ennovate Networks today announced it has raised $59 million of additional funding, another sign of booming times in the networking industry.

Ennovate executives said the additional money will help the company build up its sales and support staff internationally as it heads toward a likely initial public offering (IPO).

The start-up builds networking gear that allows service providers to offer businesses Internet-based services, such as Virtual Private Networks (VPNs). The technology gives businesses an inexpensive and secure high-speed connection to corporate networks over the Net.

The $59 million augments $22 million Ennovate previously received. In all, the $81 million in funding is one of the largest investments for a network equipment start-up based in New England, the company claims.

"This is the amount of money we need to expand our organization quickly and build a revenue stream," said Ian Mashiter, Ennovate's founder and senior vice president of marketing.

Ennovate's technology competes with larger firms such as Cisco Systems, Ericsson, Nortel Networks and Siemens, as well as smaller firms such as Spring Tide Networks and Cosine Communications.

Mashiter declined to comment on when Ennovate plans to go public.

Eight investment firms, including Lehman Brothers Venture Partners and Pequot Capital Management, sunk money into Ennovate in the latest round of funding. Two partners--PSI Ventures and Enron Ventures--also helped fund the company.

PSINet recently became Ennovate's first customer when it signed a multimillion-dollar, multiyear deal in December.