Case Studies
CyberPath
Background
With the rapid growth of telecom in the late 1990's, OpenCon Systems quickly developed from a start-up to a major industry player. The company was well regarded by many large telecom equipment manufacturers for its contract software code development, and prepackaged software modules. In 1996, Inc. Magazine recognized OpenCon as one of the fastest growing companies in its annual Inc. 500 Ranking. Among its many successes, OpenCon's work helped Fujitsu grow its SONET business by hundreds of millions of dollars.
The Opportunity
Despite the company's success in contract software development, OpenCon realized the need to develop higher margin telecom equipment that could be marketed to telecom service providers. The move into equipment development however required an entirely different business model and skill set.
Success would require that OpenCon (i) understand the economic drivers of telecom service providers in order to identify specific market needs, (ii) ensure a unique competitive advantages of its product over competing technologies, (iii) design a hardware platform and software solution, (iv) build a marketing / sales force targeted to new customer groups, and (v) raise sufficient capital to finance the project.
The Solution
Recognizing the challenges associated with raising capital, OpenCon turned to the partners of Conexus for help in funding its expansion plans. Conexus helped to analyze the target market / competing products, and developed a business / marketing plan it believed would be well received by the venture capital community.
Within six months, OpenCon via its CyberPath subsidiary developed the concept of a second generation Voice-over-DSL Gateway that captured the attention of some of the country's leading venture capital firms. The company ultimately secured product design support from Fujitsu as well as $21.4 million in first round financing by Acorn Campus - a firm founded by one of the leading venture capitalists in telecommunication network equipment - Wu-Fu Chen - who has sold a number of telecom companies to Cisco Systems for billions of dollars.