Hewlett-Packard Acquires Redmond, Wash., Software Company

Feb. 5–Privately held Consera was bought by Hewlett-Packard yesterday, only five months after it started shipping its first product.

The Redmond company develops software to help information-technology professionals within an organization manage servers automatically.

Palo Alto, Calif.-based HP acquired Consera to help complete a corporate initiative to expand its management-software portfolio.

“We’ve been talking to them (HP) for quite a while about partnering or bringing joint products to market together. We decided that this would make the most sense,” said Pamela Roussos, Consera’s vice president for marketing.

Consera was founded in March 2002 and raised one round of venture capital for $8.5 million. Including a seed round before that, the company raised a total of $10.4 million. Investors include Ignition Partners, Matrix Partners and Intel Capital.

HP would not release financial details of the transaction. But Cameron Myhrvold, a partner at Bellevue-based Ignition, said that when a startup uses only a small amount of money before being purchased, “You don’t have to pay a gigantic amount for the company to get a healthy multiple (on the investment).”

The company realized that to sell the software it would need a strong connection to a strategic partner like HP.

HP and other computer giants, including Sun Microsystems and IBM, have made a number of acquisitions in this sector, Myhrvold said. HP said yesterday it also acquired Mahwah, N.J.-based Novadigm.

“Together, (Consera and Novadigm) put repetitive, error-prone IT management tasks on cruise control and free up IT time to focus on innovation,” said Nora Denzel, a senior vice president at HP.

Myhrvold said Consera software is designed to help a company manage multiple servers. If each is built for peak capacity, for instance, it can be a waste of resources. Instead, when e-mail or Web traffic creates an unusually heavy load, the software helps the system to shift resources dynamically to ease peak periods.

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