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Andreessen Horowitz Doubles Down On Enterprise Mobility With $23 Million Re-Raise For Capriza

When companies sign up for big contracts with companies such as SAP to manage their financial planning and inventory, they soon hit a common problem, says investor Ben Horowitz: workers are increasingly on the go and working from their phones, but to move an application from a desktop computer to an iPhone can blow out an IT budget. "Nobody actually wants all 300,000 screens on their phone," says Horowitz. "They want what they would actually need to do."

To make that transition possible on a budget requires outside help, and Horowitz's firm Andreessen Horowitz has bet heavily on a startup with long expertise in the space to figure it out. Capriza announced on Tuesday that it has raised $23 million in a Series C extension from Andreessen Horowitz and fellow existing investors CRV, Harmony Partners and Tenaya Capital. The raise wasn't quite an inside round, with new investors Entre Capital and Vintage Investment joining. The funding should buy Capriza even more time for the market to catch up to its solution—the startup's raised a total of $73 million in five years—as others in the space go out of business or are gobbled up.

Capriza works with more than 100 customers such as DirecTV, Del Monte Foods and the city of Los Angeles. All in all, about half a million people are using the platform, says CEO Yuval Scarlat, who cofounded the company with some of the leadership team of previous company Mercury Interactive, whic HP acquired in 2006 for $4.5 billion. "They're all trying to figure out how they shift to a mobile-only world from an existing set of business app," Scarlat says.

At Volvo Financial Services, the financing provider for the Volvo Group , that has meant moving over a dozen apps that help handle credit checks, authorization and servicing for customers and collections for sales managers in Volvo dealerships, says CIO Adrian Samareanu. Using a solution like Capriza is much faster and cheaper in engineering cost than building a native app from scratch, Samareanu explains. "Rapid deployment and development is key," he says. "Speed is paramount these days."

The market for enterprise mobility is huge, Capriza and its competitors believe, but it's also early in its life cycle, perhaps dangerously so for startups looking to cash in. Competitor Appcelerator was acquired in January after raising nearly $88 million; another, StarMobile, was claiming technical superiority to Capriza in September 2015 only to have an acquisition offer from VMware reportedly fall through and cease at least some operations, according to a recent report which also named Reddo Mobility as another startup casualty of the category for 2016. New competitors such as SkyGiraffe claim to take their own approach to solving company's mobility problems.

Capriza's previous funding, the first part of its Series C, had been led by Andreessen Horowitz and CRV, both investors from early on. Horowitz says that Capriza is "doing very well" and simply didn't want to spend much time fundraising and thus went back to the well except for adding a couple new firms its team had gotten to know. "Being able to go in and take something that would be super costly and reduce the cost by 10x and deliver a solution that's more secure and more flexible, it's just such a compelling value proposition," he says.

The startup grew its customer base by 300% in 2015, says its CEO Scarlat. Capriza has 10 office locations and three hubs including Palo Alto and London. Scarlat says that Capriza continues to beat its investors' targets. "How can we turn a very complex environment of an SAP into an Uber-like experience?" he says Capriza asks prospective customers. "The CEO or business executive will just start smiling. But we found a way to do it without disrupting their business."

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