EMC Invests In Partner MTI

MTI President and CEO Tom Raimondi said last week in a conference call on the company's fiscal 2004 results that EMC took part in a $15 million investment in his firm. The investment, led by Advent International, is slated to be used to help MTI expand its business, notably its EMC relationship. Of the $15 million, $4 million came from EMC, said MTI CFO Todd Schaeffer.

One EMC solution provider, who requested anonymity, said it's not the first time EMC has invested in MTI. "It's just the first time it was made public," the partner said. "Imagine what other resellers think."

Kevin Hoffman, vice president of sales at Hoffman Technologies, a Sacramento, Calif., EMC partner, said he's not too worried about the MTI investment. "They can invest in me," he said.

Yet the investment does raise the possibility of channel conflict, Hoffman said. "But it also shows [EMC is] interested in the channel," he said. "It's a corporatewide philosophy that is changing. There may be conflict, but it may be positive overall for the channel."

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EMC, Hopkinton, Mass., declined to comment.

EMC and MTI have a long history together. MTI originally built proprietary storage products, and it sold RAID intellectual property to EMC in 1996. About a year ago, MTI exited the manufacturing space to focus on EMC hardware and software sales and related services.

Schaeffer said one reason for EMC to invest in MTI is a mutual focus on information life-cycle management. "EMC's ILM strategy, we fold right in that," he said. "We have technology and sales resources that have grown up around ILM. We can take this complex ILM message to the masses."

Part of the $15 million investment will be used to expand MTI's sales capabilities, Raimondi said. At the end of its fiscal 2004 fourth quarter, MTI had 22 quota-carrying salespeople and five sales managers in the United States, but it aims to hire 40 more salespeople plus some new sales managers by year-end, he said.