Data analytics firm Mu Sigma raises $108 million [Chicago Tribune]

Dec. 29--Mu Sigma, a Northbrook-based firm that helps companies analyze massive amounts of data, said Wednesday it raised $108 million in fresh capital.

Private equity firm General Atlantic, which is headquartered in Greenwich, Conn., was the lead investor. Sequoia Capital, a Silicon Valley venture capital firm that has funded technology stalwarts such as Google and Oracle, also participated in the round. Sequoia led a $25 million investment in Mu Sigma in April.

Mu Sigma, which was founded in 2004, undertakes large-scale and complex data analytics on behalf of clients such as Microsoft and Dell. Put simply, analytics helps a business understand "why something happens, what will happen, so what and now what?," said Dhiraj Rajaram, Mu Sigma's founder and chief executive.

Analytics underpin marketing, supply chain and risk management decisions in industries such as insurance, pharmaceuticals, retail and financial services. Mu Sigma has helped a consumer electronics company calculate the cost of each phone call to its customer support line for a specific product, for example. In another case, the firm used medical patient data to help a pharmaceutical company design a program for distributing free product samples that wouldn't cannibalize revenue from prescriptions.

"Analytics is pretty much in every case that you can imagine," Rajaram said.

Mu Sigma's expertise lies in tackling "Big Data," or data sets that are too large and complex for the current generation of database technology.

"The Big Data phenomenon is creating huge challenges for corporations as they look to better harness information to accelerate and improve decision making, and Mu Sigma is an excellent antidote," General Atlantic CEO Bill Ford said in a statement.

Mu Sigma has about 1,500 employees, mostly located in Bangalore, India. It employs about 50 people in the Chicago area and plans to hire 100 to 150 additional U.S. employees over the next six to 12 months, with the majority of the new jobs located in Chicago.

Part of the $108 million investment will be used to buy shares held by existing shareholders, all of whom are retaining stakes in the company, Mu Sigma said in a statement. The company said it is profitable and its revenue grew 886 percent between 2008 and 2010.

Data analytics is an active industry in Chicago. In 2009, IBM acquired Chicago-based analytics firm SPSS in a deal valued at $1.2 billion. A year later, DePaul University opened the Center for Data Mining and Predictive Analytics with funding from IBM and began offering a new masters of science degree in predictive analytics.

Rajaram said he would not be seeking additional funding or contemplating an initial public offering in the short term.

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