JumpCloud raises $50M, plans Denver office

BOULDER — JumpCloud Inc., a directory-as-a-service platform, has raised $50 million and plans to open a new office in Denver.

General Atlantic, a Greenwich, Conn., growth equity firm, led the most-recent round. Existing investors Foundry Group of Boulder and OpenView Venture Partners of Boston also participated.

JumpCloud said in a press release that it will leverage the capital infusion to expand engineering, sales and marketing.

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“As JumpCloud’s business continues to expand globally, the company also plans on investing in establishing a physical presence in strategic areas around the globe in order to provide a deeper level of support for customers in those regions,” the company said.

One new physical presence will be in downtown Denver. JumpCloud co-founder and CEO Rajat Bhargava said in a blog post Thursday that the company will open a new office near Union Station.

“The office will be set up primarily to expand its presence in the Colorado community and add space for over 50 engineers in just the downtown Denver area,” Bhargava said. “With the Denver facility near Union Station, JumpCloud will now be able to attract talent from all across the Front Range with the benefits of public transportation. The Denver tech community continues to rapidly expand and grow with tremendous talent emerging from local universities, coding schools and academies, as well as transplants from other parts of the country.”

General Atlantic’s investment means that Gary Reiner, operating partner with General Atlantic, has joined the JumpCloud board of directors. Reiner was former chief information officer at General Electric Co. (NYSE: GE)  and a member of the Citigroup and Hewlett Packard Enterprise boards of directors.

JumpCloud Thursday filed a Form D with the U.S. Securities and Exchange Commission announcing that it had raised $12.5 million out of a $75 million equity offering. Greg Keller, chief strategy officer, said the $50 million raise is part of that $75 million offering.

“The $75 million is potential option to grow,” Keller said. “We have truly plenty of cash on hand, even prior to the raise. We’ll cross that bridge [additional fundraising] down the road if we need it. Right now, the $50 million is more than enough to amplify the business to where we need it to be.”

Keller said the “intersection” between JumpCloud and General Atlantic made the investment too good a deal to pass up. He said General Atlantic typically invests in “extraordinarily large scaling events” of “many hundreds of millions of dollars.”

Examples of companies that General Atlantic has funded include Uber, Alibaba Group and Airbnb.

But General Atlantic has broadened how they look at investments, considering more long-term plays. Enter Reiner, the former chief information officer for GE and operating partner with General Atlantic, who was enthralled with JumpCloud’s offering and “wished something like this had existed at GE,” Keller said.

JumpCloud’s technology securely connects and manages employees, their devices and IT applications. Reiner’s enthusiasm for that model, coupled with General Atlantic’s ability to scale, made the match make sense, Keller said.

He said the goal is to create a business of longstanding value. “The game here wasn’t how to build a strong idea with very limited vision. It was to build something of substance in Colorado with longstanding value,” he said.

“When they’re going to invest in something like an Uber or similar, they’re looking to scale something globally,” Keller said.

He added that in the history of JumpCloud, the company has “never made an outbound call to date to sell our software.”

Now, however, the company has an opportunity to “apply outbounding and a global presence without polluting what is an incredibly performing business model.”

Keller said the company still is determining where exactly it will locate its Denver office, which he said is “the obvious place” to grow in scale, as the company seeks to add product and engineering professionals.

Thus far, every JumpCloud employee works in Boulder, in “disparate offices downtown,” he said.

“This is a Colorado company, first and foremost,” he said, adding that JumpCloud has been approached about shifting some key resource centers to other parts of the country, “but it didn’t make sense.”

“The talent is moving here,” he said, noting that JumpCloud has attracted employees from the Bay Area and other parts of the country.

Additional operations could be established in India and the Asia-Pacific region as the need arises, he said.

As for the future, Keller said JumpCloud would ideally find one location in the Denver-Boulder area.

“As a Boulderite who has built roughly four businesses of record in town, our intention is to maintain a presence in Boulder until it can’t,” Keller said. “We definitely want to be as fluid as possible between these hubs (Denver and Boulder).”

As the company grows, issues such as a future location will be resolved, he said.

“Truly, everything is available for discussion by this team,” he said. “We will choose the best location in Colorado where we can grow the most and maintain the best quality of life for our employees. Idealistically, one location would be awesome.”