Brickstream Charges Up With $6.2M

Matthew L. Sheahan (PRIVATE EQUITY WEEK), March 2003

Fairfax, Va-based Brickstream, which provides software to companies that operate retail stores, closed $6.2 million in Series A financing. Columbia Capital and Mohr Davidow Ventures co-led the round, investing $3.1 million apiece.

Co-founder and CEO Amir Hudda says that Brickstream took approximately 20% more than it originally sought from investors. "When we had started the fund-raising in September of last year we were expecting a significant amount of traction," he says. "An extra cushion would allow more aggressive growth.

"The company plans to invest most heavily in its sales and marketing efforts. Hudda expects Brickstream to grow from its total of 15 employees to between 25 and 30 by the end of the year. "We need to be able to keep momentum from the marketing perspective," says Hudda. "Making sure we continue to close the types of deals we've have done in the past." Those past deals include January's deal with convenience store chain TravelCenters of America and other top 100 banks and retail companies.

Brickstream System, the company's suite of software, uses video technology and image recognition, allowing retail companies to anonymously track customer movement in individual stores and analyze the data to improve customer service, in-store advertising, promotions and store layout. Brickstream seeks out large companies with multiple retail locations as customers and says its services are most applicable to companies that do at least $100 million in revenue.

"This is the first technology beyond sampling and surveying. They can tell managers exactly what's happening in their store," says Erik Straser, a general partner with Mohr Davidow, who worked on the deal with MDV general partner Mike Sheridan. Sheridan has joined the Brickstream board of directors with Arun Gupta of Columbia Capital.

Brickstream launched in January of 2002 after raising $1 million in seed funding from its founders and an angel investor. The company expects its Series A funding to last it to profitability, which it expects to reach by the second half of 2004. Brickstream may raise a Series B round in late 2004 or early 2005 for company expansion focused on North America.

"We've got the funding in place," says Hudda. "That itself was a key challenge given the environment. Now the challenge is going to be primarily based on execution of our strategies on the sales and marketing front."

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