Cisco Beefs Up WebEx With $215 Million Acquisition of Email Startup PostPath

Cisco is getting into the Web e-mail game with a $215 million purchase of five-year-old PostPath. PostWho? The company sells a Linux-based e-mail service to enterprises somewhat like Zimbra (which Yahoo bought for $350 million last year). PostPath is a fully functional in-browser Ajax client, and on the back-end it is trying to take on Microsoft Exchange.
The software also works on mobile phones, including the iPhone. Cisco will add PostPath’s functionality to its WebEx collaboration service (it bought WebEx for $3.2 billion last year).

Not a bad outcome for a company whose software development team is based in Bulgaria. PostPath previously raised a total of $30 million. Its most recent round was a $15 million series C in January, 2007. Investors included JAFCO Ventures, Matrix Partners and Worldview Technology Partners.

As software moves to the cloud, Cisco wants to capture some of the higher margins that go along with that, as opossed to simply pushing boxes that quickly decline in value. Many of us already rely exclusively on Web-based email, but corporations are only now making the shift.