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Corona Networks Scores $40M

Light Reading
News Analysis
Light Reading
9/27/2001

Corona Networks Inc. is scheduled to announce today (9/27) the closing of a $40 million funding round, proof that some investors still think there's money to be made in the telecommunications hardware business.

Led by Merrill Lynch & Co. Inc. Ventures and New Enterprise Associates (NEA), Corona's third round of funding should be enough to see the company through to "a quarter or two of revenue," according to Ramandeep Singh, Corona's president and CEO.

Corona is developing an aggregation and IP services switch, called the ISP 12000 (see Corona Intros IP Service Platform), for the network edge market. Though not scheduled to ship until early next year, Corona says the ISP 12000 is already in trials with four carriers, which Singh declined to name, assuring only that, "They're very large carriers."

They would have to be, being that the ISP 12000 will likely cost in the hundreds of thousands of dollars per box. Though none of the carriers have signed pledges to buy the product, Singh says the trials are "a good first step" toward eventual revenues.

"We're very confident we'll have customers," says Singh, who believes the network edge will be among the first markets to see any pickup in capital expenditures.

"We've talked to the largest carriers, and they have spending plans in place for the [network] edge," Singh says. "Their cutbacks have mostly been in long-haul. The edge is where we expect to see a lot of [buying] activity." Additionally, he says, the latest round of cash gives Corona enough funding to get through developing and shipping the ISP 12000, a process Corona hopes to reach by early next year.

Tom McConnell, general partner at NEA, says he will likely take over as Corona's chairman, replacing Steve Pearse. Pearse, a friend of Corona co-founder Raj Singh, is currently a more active chairman with Inara Networks Inc., another startup (see Ex-Cyras CEO Joins Roshnee Spinoff) in the Raj Singh stable. McConnell, who says his firm has invested a total of $27.2 million in Corona to date, adds that he "really believes in this team," calling them a "focused group" with a solid core of engineers and executives.

McConnell says Corona's ability to secure carrier trials was "an important milestone" for the company's investors. "We're confident that this latest round will get [Corona] to revenue shipments, and maybe even cashflow break even." McConnell also praised Corona's ability to stretch budgets. "Every dollar this company has had has been well spent," he says.

The ISP 12000, according to Corona, is designed for central office or points-of-presence deployment, between carriers' edge access and core backbone connections. Though the company's website claims that the ISP 12000 can support interfaces from 10/100 Ethernet through OC-192, the fastest links available by early 2002 will only be at OC-48, according to Alex Henthorn, Corona's senior director of product management. Henthorn says support for higher speeds will be added over time. Corona also claims that the ISP 12000 will offer built-in firewall and VPN support.

- Paul Kapustka, Editor at Large, Light Reading
http://www.lightreading.com

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M$BIG
M$BIG
12/5/2012 | 12:04:05 AM
re: Corona Networks Scores $40M
test
M$BIG
M$BIG
12/5/2012 | 12:04:04 AM
re: Corona Networks Scores $40M
This thread forecasts a dismal future for Corona Networks. Where is the company now?
nixon
nixon
12/5/2012 | 12:04:01 AM
re: Corona Networks Scores $40M
Sounds like they are doing good. With rich features, off-shore development, and more funding, Corona may end up being a good bargain purchase for someone. --nixon
M$BIG
M$BIG
12/5/2012 | 12:03:58 AM
re: Corona Networks Scores $40M
Thanks, been searching for news/info, but cannot find much. Any ideas? M$
netpert
netpert
12/4/2012 | 11:55:29 PM
re: Corona Networks Scores $40M

"Sounds like they are doing good. With rich features, off-shore development, and more funding, Corona may end up being a good bargain purchase for someone. --nixon"

Just came back from vacations - couldn't stop laughing....

Can you elaborate how a company with no sales, no money, little engineering talent left, barely working product, and a very pathetic management team now can be a good bargain in a hyper competitive VPN, Edge Routing and BRAS market?

Also, what is the value proposition now that every one has BRAS integrated on their edge /VPN routers?
nixon
nixon
12/4/2012 | 11:53:58 PM
re: Corona Networks Scores $40M
How can a company last so long? Companies like Timetra didn't have any customers, nor hardened products either.

But with Alcatel grabbing Timetra, the glass seems 1/2 full, or more like 1/16 full for Corona. I must be an optimist.
TruthWillInfect
TruthWillInfect
12/4/2012 | 10:43:51 PM
re: Corona Networks Scores $40M
You miss the point about Joe Stanton. He was never hired to actually make sales. He was hired to convince the VC's to invest in Corona. You have to admit - he's been successful at that.

The real question is, why are the VC's still throwing money at a company that has no product, and, therefore no hope of making sales?




George Lucas
George Lucas
12/4/2012 | 10:29:12 PM
re: Corona Networks Scores $40M

I know for sure that the best team is about to dis-integrate.

I saw their lead software guy believed to be mainly responsible for all ip services software and VPN arch with our CEO last week. The rumours tell me that he will be joining us soon.

Looks like something is cooking there. Any insider?

ooGLoo
UncleBond
UncleBond
12/4/2012 | 10:21:23 PM
re: Corona Networks Scores $40M
its 5/21 today and no one from the software team has left/plans to leave. maybe the software guy was trying to hire your CEO for some marketing position :)

- Uncle Bond.
datacom
datacom
12/4/2012 | 10:10:09 PM
re: Corona Networks Scores $40M

The reliable sources tell me that the company is as good as dead with money to pay only for a few more weeks, and product is still months away. I am surprized that it lasted as long as this.

The ruthless duo of founder and CEO have faught more inside battles within management teams and vanquished more good people since its inception, than all other valley startups combined. According to insiders and company watchers, there has been nothing, but constant management wars inside. The founder versus engineering VP X Versus product director Y, or CEO versus director of product management versus engineering VP versus sales VP versus hardware VP. Each one attempting to fire one another depending upon percieved support from the board members. The board appears to be very weak otherwise it would not have allowed duos to screw the entire organization repeatedly.

According to insiders, the entire product management team has already left, and all product management directors have resigned and moved on. All the good guys returned back to Cosine. And so I am told are all engineering directors and leads either pushed out by infighting, or went away at their own. I feel sorry for those who are still there to see the slow death.

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