Melbourne-based Open Software Associates (OSA) has secured $7.2 million in new equity, more than double its initial expectation of $3 million.
The equity came soon after the release of its netDeploy Global software management suite.
"We actually went out to the market to raise $3 million. The market appreciated our plans so much that we upgraded our term sheet to a maximum of $5 million part-way through. In the end we were forced to scream 'Stop!' at $7.2 million," said John Cromie, OSA's chief executive officer.
The lead investor in the uptake is Technology Venture Partners (TPV), followed by stockbroking firms J.B. Were and Deutsche Bank, and private investor groups Aegis Partners, Tigela and Seafirst Australia. TPV's executive director, John Murray, will take a seat on OSA's board.
OSA's intends to use the $7.2 million to forms its netDeploy Global business plan, which includes expanding its marketing capability and future capital-raising activities.
"Specifically, we are investing almost all of it in a major, rapid expansion of our worldwide sales and marketing capability. Some of the new capital will be utilised in further capital-raising activities, and we have retained Deutsche Bank, one of the new investors, to advise us on our options," said Cromie.
While Cromie said that OSA's new product drives investors' enthusiasm, he acknowledged that the company's history of stable returns was just as important. "It is one thing to sell strategy without history, and another to back up your strategies with a solid account of stable, profitable growth."
Incorporated nine years ago, OSA has been profitable in the last six years, achieving average growth rates of 40 per cent annually. It was also the recent winner of the Victorian Government's export award for information industries, and the recipient of a Federal Government grant of $6.25 million for R&D.netDeploy Global allows large enterprises to provide single-point management of all its software, including software used in remote offices and by mobile workers and business partners. It supports all major applications and operation systems including Windows 2000, legacy Windows, Macintosh and Unix.