Meraki Raises $20M Series B

[qi:045] Meraki Networks, the startup that makes mesh networking gear and is building an ad-hoc San Francisco Wi-Fi network, says it has raised $20 million in a Series B round. While San Francisco’s official Wi-Fi network is MIA, Meraki has been building out a distributed Wi-Fi network by providing residents with free, low-cost repeaters and funding the network out of its own pocket.
And initiative like that needs funding, as does Meraki’s main goal of selling its Wi-Fi hardware. The Mountain View, Calif.-based company’s backers in this latest round include Sequoia Capital, DAG Ventures, and Northgate Capital. Back in February of last year, Sequoia led a Series A round investment of $5 million, and Google and angel investors gave Meraki a seed round in November 2006.
Last October the company launched a three-tiered business model that could boost revenues but also effectively alienated some of its existing customer base. The problem was a doubling in price of some of its gear, to $150 per wireless router. Sanjit Biswas, co-founder and CEO of Meraki, explained to us that the price increase was just ‚Äúpart of the business evolution of the company.”
Though we understand that the company needs to charge enough to make enough margin off its products, perhaps these funds can help Meraki, which has morphed from the open-source MIT Roofnet project into a well-funded startup, keep its lower price tag.