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BTI Systems gets $10 million from Bain Capital, reveals cloud strategy

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BTI Systems, a growing packet optical network platform vendor, on Monday received $10 million in new funding from Bain Capital Ventures to expand its operations and its new Intelligent Cloud Connect offering.

Joining Bain this recent funding round are existing investors BDC, Covington Capital and GrowthWorks. Last month, Bain invested $8.5 million in the company.

At the time it secured the initial funding from Bain, BTI said a big piece of it would be dedicated to driving its cloud initiative.

"The focus of this funding, which we closed last month, in addition to our existing and growing business is to accelerate the launch of Intelligent Cloud Connect," said Sally Bament, senior VP of global marketing for BTI Systems, in an interview with FierceTelecom.

Since Q1 2011, the optical vendor has raised over $33 million in funding.

The vendor expanded its West Coast presence by opening a second office in Silicon Valley.

"Our new West Coast office in Palo Alto is located near a lot of our content and Web 2.0 providers, some of which are our existing customers [that] are based on the West Coast," Bament said.

To enhance its operations, BTI also named Crossbeam veteran Thomas Nolette as its senior vice president of global operations. Nolette joins BTI from Blue Coat, which acquired Crossbeam last December.

The new funding will also enable it to build up Intelligent Cloud Connect, a software defined networking (SDN)-based offering that addresses inter-data center network traffic driven by business and consumer demand for cloud services.

While there has been a lot of focus on the network traffic issues inside the data center, BTI said that Intelligent Cloud Connect can address four other issues: optimizing network traffic bottlenecks from data centers to users; data centers to peering points; data centers to data centers; and data centers to partners.

"There has been a lot of work and even some new companies, even in the Boston area, focused on innovation inside the data center, but not a lot of focus or innovation on how you connect these data centers together, whether it's between each other with access networks, peering points, or even partner networks," Bament said. "It's really about how we allow content service providers like Amazon (Nasdaq: AMZN), Facebook or Linked In to continue to expand to support this dramatic transition and adoption of cloud services in a way that adds bandwidth and in an intelligent way that allows the network to adapt to the needs of the cloud applications."

In recent years, BTI has been gaining momentum in the emerging Packet Optical Transport Systems (P-OTS) segment of the optical networking industry, winning a number of contracts with a number of Tier 2 telcos and CLECs, including Consolidated Communications (Nasdaq: CNSL), Frontier Communications (Nasdaq: FTR), and CBeyond (Nasdaq: CBEY).

The Intelligent Cloud Connect product, while still new, could help strengthen its relationships with its existing customer base that's expanding or introducing their own cloud initiatives, particularly Frontier (Nasdaq: FTR) who revealed in its Q4 2012 earnings call that it would debut its own cloud offering in April, for example.

For more:
- see the funding release
- and the ICC release

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