Hosted Groupware Firm Socialtext Talks Up Seed Round
By Lizbeth Scordo
PALO ALTO, CALIF. -- Socialtext, a provider of Web log groupware, said it has closed its seed round of funding with an undisclosed amount. Individual investors including Reid Hoffman, CEO of LinkedIn and former EVP of Paypal; Joi Ito, a venture capitalist with Neoteny; Mark Pincus, co-founder and former CEO and chairman of SupportSoft; and Erik Josowitz, former vice president of product strategy of Vignette, provided the funding along with Oakstone Ventures and Freedom Technology Ventures.
According to CEO Ross Mayfield, the company will use the new capital for product development and customer service. Socialtext has several paying beta customers, including cycling products company Zipp and Global Business Network, a network for exploring emerging issues and ideas and their implications for business and society. Socialtext will release version 1.0 of its software in about a month, he said. The company which was founded last December and incorporated this past May, has four employees.
Socialtext has developed groupware as a hosted service built on Web logs for workgroups. The groupware enables groups to organize themselves, have discussions, create documents together, and publish their work. The starter package for five users costs $995 annually. While the technology can be used across all industries, it is especially useful in the professional services and high-tech sectors, according to Mr. Mayfield. Mr. Mayfield said the company has begun raising a Series A round of funding.