The list of big Israeli exits for 2008 keeps growing: IBM is buying start-up FilesX for an estimated $70-80 million, though the sides have refused to disclose the price.
Investors, employees and the founders will all share nicely in the proceeds, as only $19.75 million has been invested in the company so far, according to data from IVC-Online. This will give investors a 3.5 to 5 times return on their investment, if price estimates are correct.
At the same time, there are those in the venture capital industry who say that since the sum involved was less than nine figures, the company was in a rush to cash out.
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FilesX develops software for continuous data protection and recovery management for Microsoft Windows software. IBM will make FilesX technology part of its Tivoli Storage Manager product line, its flagship data infrastructure product.
FilesX, founded in 2000, has a research and development center in Haifa and headquarters in Massachusetts and has over 100 customers in the U.S. and Israel. It has 44 employees.
The deal will make a few new millionaires: CEO Jimmy Garcia-Meza is one of them, as is co-founder Jacob Herbst, who is expected to pocket about $2 million.
The other two co-founders, Asaf Tzarfati and Irit Mani-Meitav, left FilesX three years ago, but they probably still have holdings in the firm - though these have been diluted during various fund raising rounds.
The biggest winners will be a number of venture capital funds, with Genesis Partners being the oldest and largest shareholder. Index Ventures and Benchmark Capital are also major investors.
This is not IBM's first purchase in Israel. A few months ago it bought XIV for over $300 million, and it has been reported that the company is negotiating to buy Diligent. Both companies are in the data storage technology field.
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