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Tuesday, Feb 7, 2023

StoneFly to Stay Under New Owners

StoneFly Networks, a San Diego-based provider of storage area networks using Internet protocol, was acquired by Dynamic Network Factory Inc. of Hayward for an undisclosed price.

StoneFly, founded in 2000, attracted four rounds in venture funding for $34 million but was seeking even more investment funds when it struck the deal.

Among the primary venture funds invested in StoneFly are Eldorado Ventures, Palomar Ventures and Rustic Canyon Group.

DNF said it would maintain StoneFly’s current offices in Sorrento Mesa, where it recently signed a three-year lease, and operate the firm as a wholly owned subsidiary.

Jame Ervin, a DNF spokeswoman, said the unit expects to expand its sales team as well as hire additional engineers and support personnel.

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DNF, a venture investor in StoneFly last year, was talking about another round of investment when StoneFly agreed to sell the entire firm. The deal entailed all of its assets and was for cash and stock, Ervin said.

Mo Tahmasebi, the president and chief executive officer of DNF, said he anticipates expanding upon StoneFly’s proven technology while adding customers both in the original equipment manufacturing and reseller channels.

Dennis Hergert, a four-year StoneFly executive, was named the firm’s director of operations.

DNF has some 20,000 customers, including Fortune 500 companies, hospitals, financial institutions and government agencies. The company would not disclose its revenues, or the number of employees at DNF or at StoneFly, but said sales had doubled during the last five years.

, Mike Allen


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