Ennovate Networks, a 4-year-old New England company developing IP (Internet Protocol)/MPLS (Multi-protocol Label Switching) switches for the edge of service provider networks, has shuttered operations.
The company failed to raise additional funding and ran out of money, says Ian Mashiter, an Ennovate founder and senior vice president of strategic marketing. Ennovate rang up US$81 million in total funding but has not received any additional funds since a $59 million round in February 2000.
The company's only announced customer, PSINet Inc., went bankrupt earlier this year.
"That was a big blow for us, obviously," Mashiter says.
Ennovate's Envoy 1600 and 700 switches were in trials at two other "major" customers, Mashiter says, one of which was to turn up service in February 2002.
Despite that, "there was no willingness from investors" to provide additional money to the company, Mashiter says.
Analysts say Ennovate's Envoy switches could not stack up against the competition in the IP/MPLS edge switch business.
"They had good ideas but they had a fairly weak initial product that didn't evolve and no customers," says Zeus Kerravala, a research director at The Yankee Group. Companies such as Shasta, Cosine and others stepped up with products that scaled and performed better, he says.
Mashiter declined to respond to Kerravala's comments. "It's not useful at this point in time," he says.
Ennovate employed about 220 people at the beginning of this year. In April, it laid off 90 employees, and the remainder are now out of work.
The company's investors included Lehman Brothers Venture Partners, Pequot Capital Management, Kohlberg Kravis Roberts & Co., Tudor Investments, PSI Ventures, Enron Ventures, The Sprout Group, Marquette Venture Partners and Spectrum Equity Investors.