Looking Glass Comes into Focus
Battery Ventures http://www.batter.com also contributed to the round, along with some smaller, unnamed investors.
What drew so much money to Looking Glass? The metropolitan area service provider has assembled a hard-hitting team of WorldCom Inc. http://www.wcom.com (Nasdaq: WCOM) execs. And in the start-up world, a winning team with a proven track record goes a long way. "There are few people who know how to build networks like this," says Andrew Sinwell, director at Madison Dearborn. "This is an experienced management team that knows the demand of the market and how to build the networks. It's a great opportunity."
Lynn Refer and Sunit Patel, the two co-founders of Looking Glass, have deep roots in the local market. Before coming to MCI WorldCom, both men worked for local fiber provider MFS Communications Company Inc., which merged with WorldCom in 1996. The two were instrumental in developing MCI WorldCom's metropolitan-area strategy. Refer, CEO of Looking Glass, was a VP of engineering and reported directly to Ron Beaumont, president of network services for WorldCom. Sunit Patel, CFO of Looking Glass, was treasurer at WorldCom.
The two have also recruited more talent from WorldCom and MFS. Stacy Jenkins, ex-president of MFS network technologies, is now the VP of Network Deployment for Looking Glass. And John Carruth, a former VP of engineering at WorldCom, is heading up the engineering team.
Not only has the company assembled an impressive team, but its plan to sell lit and dark fiber to Competitive Local Exchange Carriers (CLECs), Application Service Providers (ASPs), Internet Service Provers (ISPs), and even to Incumbent Local Exchange Carriers (ILECs) is on track, say experts. Using high-capacity fiber and next generation equipment from startup optical companies such as Cyras Systems Inc. http://www.cyras.com, which recently announced its Sonet platform, the service provider says it will be able to provision services and capacity much faster than is currently possible (see Cyras: The Next Cerent? ). Where it might take three or four months to set up an OC-12 connection on a legacy network, Looking Glass aims to do it in a matter of days or even hours.
While the huge investment in Looking Glass is certainly a good vote of confidence for the start-up, investors shouldn't forget that other local providers like GST Telecommunications http://www.gstcorp.com (Nasdaq: GSTX) and e.spire Communications Inc. http://www.espire.com (Nasdaq: ESPI) have gotten themselves into severe financial troubles recently (see GST Files for Bankruptcy) and (see e.spire's Finances Raise Flags)."
Looking Glass' $200 million investment may indicate that regardless of woes elsewhere in the carrier space, venture capitalists aren't ready to stop betting on startup fiber providers.
by Marguerite Reardon, senior editor, Light Reading