Welcome back to Baby Breakerdom! This week's quest to uncover budding Rule Breakers finds cash in data appliances and Web 2.0.
First up this week is DATAllegro, which makes combinations of hardware and software, dubbed "appliances," that are used for data warehousing. Don't worry if that sounds utterly confusing; I'll explain in a moment. In the meantime, you simply need to know that the concept is drawing lots of investment.
On Wednesday, DATAllegro announced $22.5 million in third-round finding. Participating investors were JAFCO Ventures, Focus Ventures, Adams Capital Management, Palomar Ventures, Venrock Associates, and Intel's venture-capital arm.
Why all the interest? Appliances are arguably the new big thing in information technology. They save money and effort by combining a mishmash of hardware and software in one box, custom-designed to handle a single complex task. For IT managers, data warehousing is about as complex as it gets.
Data warehousing is the process of taking information from key operational systems -- including inventory management, finance, customer service, and the like -- and storing it offline for later analysis. That process involves many moving parts, including databases from the likes of IBM (NYSE: IBM ) , Oracle (Nasdaq: ORCL ) , and NCR (NYSE: NCR ) , and integration software from Informatica (Nasdaq: INFA ) and Embarcadero Technologies (Nasdaq: EMBT ) .
Once completed, data warehouses serve as the access point for business intelligence (BI) tools from Business Objects (Nasdaq: BOBJ ) , Cognos (Nasdaq: COGN ) , Hyperion (Nasdaq: HYSL ) , and others like them. But access can be hindered by the complexity of data warehouse design. DATAllegro addresses that problem by reducing the number of break points -- a smart idea.
Next up is Web 2.0, the confusing moniker that describes websites that combine aggregated content, community, and network effects. It, too, threatens to claim the title of "the new big thing," thanks in no small part to significant investments from the venture-capital community.
VentureWire reports that during the first half of 2006, investors supplied 49 U.S. Web 2.0 start-ups with $262.3 million. That's up more than -- wait for it --169% from last year at this time, when $97.2 million had been spent on 24 funding deals. I mean, wow.
I have no idea whether any of us at the Fool will have a chance to bask in the reflected glory. Ten days ago, we launched our own Web 2.0 site, Motley Fool CAPS, where Fools square off to compete for investing superiority. CAPS' community intelligence leads to unvarnished ratings on thousands of stocks.
OK, enough with the plug. The bottom line here is that Web 2.0 is capturing the imagination of those pulling the purse strings. Accordingly, rebellious growth investors would do well to follow the space in the coming months.
That's all for now. See you back here next Friday, when we continue the quest to find the next ultimate growth stock.
For more Rule Breaking Foolishness:
- Check in with our last round of infants.
- Is Googleworth buying? Or not?
- Learn to separate the baggers from the gaggers.
High tech. Biotech.Nanotech. Any tech. David Gardner and his Foolish band of analysts cover it all forMotley Fool Rule Breakersselection and they've unearthed four multibagger stocks in less than two years as a result. Want to find who they are? Try the servicefree for 30 days.
Fool contributorTim Beyersowns shares of Oracle and has been a contractor for Business Objects. Get the skinny on all the stocks he owns by checking Tim's Foolprofile. The Motley Fool'sdisclosure policyis a rebel with a cause.