Dow Jones VENTURE WIRE
Sept. 19, 2007
By Ty McMahan
Mimeo Inc. says the number of documents it prints each week could be stacked twice as high as the Empire State Building, an appropriate comparison for a company that has just secured $25 million in venture capital and sees the sky as the limit.
Goldman Sachs Principal Strategies Group was a new and lead investor in the recent financing for the online printing company. Prior backers Draper Fisher Jurvetson, its New York affiliate Draper Fisher Jurvetson Gotham Ventures, HarbourVest Partners LLC and Hewlett-Packard Co. also participated in the round.
Founded in 1998 and based in New York, Mimeo provides an on-demand Web-based service for remote document printing and delivery. The company produces and fulfills orders from a centralized production facility, which it calls a document superhub, located in Memphis. The company prints 3 million pages each night and will likely produce 5 billion documents this year, Chief Executive Adam Slutsky said.
Competitors include VistaPrint USA Inc., a unit of online graphic design and printing service VistaPrint Ltd., which went public in 2005.
Slutsky said the company has been profitable for two years. He declined to provide specific figures, but hinted at annual revenue approaching $100 million. While the company has raised more than $75 million from investors, Slutsky said the company is not worried about producing a return for investors in the short term.
“These guys, at one moment, will want an exit,” Slutsky said. “But this round proves that a strong company has multiple exits. If any of those guys wanted to part with their shares there are possibilities beyond a public offering.”
And that’s exactly why Mimeo raised the $25 million. Rather than making a move toward a public offering, the company is staging a big push in the market. Slutsky said the recent round of funding will be used for sales and marketing and rollout of new products and services. The company also is looking at expansion opportunities outside of the U.S.
“We know the business model works and we know from our current customers what they would like from us,” Slutsky said. “We know the size of the opportunities and all we need is more money for business growth.”
Slutsky said a fresh round of capital was the fastest way to get the company to scale.
“We understood the size of the opportunity and we know we can deliver,” Slutsky said. “Doing it from our own free cash flow, we would have been done with the first part of the plan in three years. This way, we’re able to roll it out immediately.”
Slutsky said there was a great deal of interest in the company’s sixth round of funding.
“We saw north of 10 of the top late-stage VC and private equity guys and received term sheets from each of them,” Slutsky said.