Startup Capriza scores $27M to Zapp legacy apps into mobile ones

Capriza, a startup that helps enterprises convert their legacy apps into mobile- and cloud-based ones, Thursday announced it has racked up an additional $27 million in venture funding. That should be enough to help Capriza scale its business on the marketing and sales side, and maybe even have enough left over to afford a drummer and bassist to form a company band (more on that later...).

The Palo Alto firm, which started in 2011 and now employs an engineering-heavy staff of about 60 people, has raised a total of $50 million. The latest funding comes courtesy of existing investors Andreessen Horowitz and Charles River Ventures, with Tenaya Capital now joining the party as well. Harmony Partners and Allen & Co., have also chipped in on this round.

One reason investors have faith in Capriza is that its founders previously were all top executives at Mercury Interactive, an enterprise management software company that HP bought for $4.5 billion in 2006.

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Capriza has been selling its software-as-a-service offering for about 10 months and now counts more than 100,000 end users, including at big name customers such as Brocade and DirecTV. A subset of the customers' employees use Capriza's Designer product to rework and extend existing apps, such as customer relationship management software from SAP as well as internally-designed custom apps, into what the company calls Zapps.

Zapps are lighter weight and cloud-backed versions of the original apps designed to work fast and simply for end users regardless of where they are, but often this means people in the field using iOS, Android and other smartphones and tablets. Capriza's formula allows for apps to be reworked for specific use cases, including for small and large groups (the product is licensed based on the number of enterprise users, not the number of apps deployed).

Capriza claims running Zapps is secure in large part because data is not stored on the mobile devices, and the company offers a slew of management and analytics tools for organizations to track how the mobilized apps are being used, how virtual machines are faring and more.

CTO and co-founder Oren Ariel took me through a demo of the product via screen sharing, during which he illustrated the dragging and dropping of only the most vital fields from the old apps to new mobilized ones that take advantage of web services, such as mapped addresses. Capriza customer DirecTV, he says, takes advantage of the mobile format to scan QR codes in the field, which eliminates mistakes from typing in information. End users get a "consistent, look and feel...mobile-first experience across any type of device," he says. But the apps also are rich, inheriting "years and years of business logic" from the original apps, and "injecting mobility in the right places in the business process," Ariel adds.

"The last 10 to 20 years of investment in enterprise systems really don't render themselves very well on these new mobile devices that are becoming very pervasive," Ariel says. Early adopters are frequently using Capriza to mobilize and make more efficient processes people otherwise hate to deal with, such as handling timesheets, he says. Line-of-business employees are always involved in purchases, though IT needs to be on board as well for data security and enterprise architecture reasons, Ariel adds. [Click "play" button on Audioboom module above to hear Ariel describe what he's seeing on the BYOD front at customer sites]

Though the "$64 million question," according to Chris Marsh, 451 Group Principal Analyst for Enterprise Mobile App Strategies, is whether organizations will really hunker down and retrofit many of their existing apps for the mobile world or just build new ones.

"My feeling is that while it may be appealing in the short term (because it seems straightforward conceptually) companies won't be migrating their legacy systems in a swap-in-swap-out or replace one-desktop process for one-mobile process arrangement," says Marsh, who late last year issued a report on Capriza. He expects more object-based and easy drop-and-drag development to emerge alongside a flatter data model that will allow organizations to create custom data mash-ups and apps.

But for now, given the new funding and growth plans -- along with solid partners such as Oracle, Citrix and BMC -- Capriza is on a roll.  Asked about the company's culture, Ariel said that Capriza like Mercury Interactive is very "in the trenches" customer focused, and that goes for the engineers. But he says the team also likes to have fun, noting that guitars are scattered around the office. As it turns out, three of the founders were musicians and would love to form a company band at some point, though Ariel mentions they need a bassist and drummer. That shouldn't be too hard to find as sales and marketing hiring ramps up.