General Atlantic, Sequoia Invest $108 Million in Mu Sigma

December 29, 2011, 3:19 AM EST By Danielle Kucera

(Updates with comment from General Atlantic in the fourth paragraph.)

Dec. 28 (Bloomberg) -- Mu Sigma, a company that helps businesses make decisions by analyzing data, attracted a $108 million investment, the largest round of private-equity financing in the analytic-services industry.

The funding was led by General Atlantic LLC and followed a $25 million round in April, Northbrook, Illinois-based Mu Sigma said today in a statement. Sequoia Capital led the earlier investment and participated in the new round, raising its stake in Mu Sigma, according to the statement.

Mu Sigma will use the capital to add 600 to 700 employees to its 1,500 within the next year, said Dhiraj Rajaram, chairman and chief executive officer of Mu Sigma.

“The whole area of big data and data analytics and support, we think, is very large and will continue to grow,” Pat Hedley, a managing director at General Atlantic, based in Greenwich, Connecticut, said in an interview. Mu Sigma has a great client base and a strong management team.”

The deal is the largest investment on record by a private- equity or venture-capital firm in the data-processing and enterprise-software services industries, according to data compiled by Bloomberg. The second-largest is Penta Capital LLC’s $94 million investment earlier this year in Six Degrees Technology Group Ltd., a company that specializes in cloud computing.

Board Seat

William Ford, General Atlantic’s CEO, will join the Mu Sigma board.

Mu Sigma’s revenue will increase 35 percent to 40 percent in 2012 and profit will “dip slightly” as the company increases investments in a training program, marketing and services for clients such as Microsoft Corp. and Dell Inc., Rajaram said. The money raised will also be used for hiring and to buy out early investors, he said.

Mu Sigma helps clients analyze larger sets of data than software tools ordinarily are capable of handling. The amount of data in the world is doubling every two years, according to EMC Corp.

“It’s a big problem that we’re trying to solve,” Rajaram said in an interview.

--Editors: Jeffrey Tannenbaum, John Lear

To contact the reporter on this story: Danielle Kucera in San Francisco at dkucera6@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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