SugarCRM raises $20 million in funding

SugarCRM, which makes open source customer relationship management software, said it has raised $20 million from New Enterprise Associates as well as its current investors.

To date, SugarCRM has raised $46 million. Investors include New Enterprise Associates, Draper Fisher Jurvetson and Walden International. With Sun's acquisition of MySQL it's becoming clear that open source applications companies can be solid takeover targets.

SugarCRM said it to expand research and development and efforts in Europe and Asia. On Wednesday, Paula Rooney reported that SugarCRM is now supporting Solaris and Blackberry smartphones. SugarCRM is holding it annual conference in San Jose.

CEO and co-founder John Roberts told my colleague Dan Farber that SugarCRM is on track to go public. "It's the end of the startup phase. We are clearly looking to and believe we can become large public company in the next couple of years" he said.

SugarCRM doesn't report its revenues, but it is hugely dwarfed by Salesforce.com, which is on track to top $1 billion in annual revenue and has over 38,000 customers. SugarCRM ended 2007 with over 3,000 customers in more than 30 countries and 100 employees, Roberts said. In light of the success of recent IPOs such as NetSuite and commercial open source exits such as Sun acquiring MySQL, Roberts has some reason for optimism.

Roberts doesn't plan to go beyond the CRM space at this point. "CRM is a large space. The market is just beginning, considering that 70 percent of CRM installations are customer built on site," he said. Some of the new funding will be invested in the on demand portion of its business, tripling the size of its data centers, including opening new facilities in Europe and Asia.

On the development front, Roberts said that the company is focused on wireless, including creating applications that run inside the forthcoming Google Android platform, and leveraging some of the social networking technologies in the second half of this year.