"The fact that Tejas could get Goldman gives a good sense that people are willing to bet on India-based telecom equipment companies," boasts CEO Sanjay Nayak, adding that the firm's other investors include big names like Battery Ventures , Intel Capital , and Gururaj "Desh" Deshpande, the chairman of both Tejas and Sycamore Networks Inc. (Nasdaq: SCMR).
Tejas has also expanded its team of independent directors in recent months, signing up Mohandas Pai, director of human resources and former CFO at IT software and services giant Infosys Technologies Ltd. (Nasdaq: INFY), and Professor J. Ramachandran, professor of business policy at the Indian Institute of Management.
The new investment brings the total amount Tejas has raised to $73 million, most of which it's scored in the last year. Prior to its $20 million round in November 2006, it had raised $29 million in the six years since its launch in 2000. (See Tejas Scores Another $20M.)
"From a financial point of view it's important because of the capital efficiency in India," Nayak says. "It gives us the opportunity to quickly scale up."
The cash will allow Tejas, which makes next-generation SDH multiservice provisioning platforms (MSPPs), to ramp up its product development more quickly. Nayak says the company is putting a lot of investment into carrier Ethernet and will be announcing new products "in the not too distant future." Earlier this year the company announced it had shipped its 100,000th Ethernet port. (See Tejas Ships 100K.)
The vendor has been roughly doubling its revenues each year and has been profitable since early 2006. It's also doubled its headcount in the last year or so to 500 in offices across India and in Dubai, Singapore, and Boston.
Table 1: Tejas Networks' Revenue Growth
|FY (April � March)||Revenues in millions of Rupees||Revenues in US$M (INR40=US$1)|
|2006 - 2007||2,340||58.5|
|2005 - 2006||1,280||32|
|2004 - 2005||470||11.8|
Tejas has been among a raft of Indian companies looking to expand internationally, so its flurry of new funding rounds will help there.
"We're mostly eyeing emerging markets -- that's where a lot of growth is," Nayak says. "The way they build networks is very similar to the way we build networks in India."
In India, Tejas has more than 20 percent market share in the overall optical networking space, ranking second behind ECI Telecom Ltd. , and Nayak claims his company is No. 1 in its "addressable market" for edge gear. Tejas has contracts with all the major domestic operators, and with network buildouts accelerating, it's well positioned for further growth.
"We're starting to see more broadband penetration and multiplay services," the latter expected to really take off "probably towards the second half of next year," Nayak says. We expect a lot more need for bandwidth with so many bandwidth-hungry applications coming into the market."
— Nicole Willing, Reporter, Light Reading