Demandware, Inc., provider of the Software as a Service (SaaS)-based ecommerce platform that offers merchants the optimal combination of control, flexibility and a usage-based pricing model, announced that it has raised a $12 million Series B round of funding, bringing its total raised capital to $22 million. This round was co-led by both of Demandware's Series A investors, General Catalyst Partners and North Bridge Venture Partners, with participation from Demandware management. The financing will be used to support the continuous enhancement of Demandware's ecommerce solution functionality, support its hiring plans, and expand the Company's sales and marketing activities in order to capitalize on the market opportunity for ecommerce solutions.

"We are pleased to have received a vote of confidence from both of our Series A investors through this latest round of funding," said Stephan Schambach, CEO of Demandware. "Both Larry Bohn of General Catalyst Partners and Michael Skok of North Bridge Venture Partners are experienced and knowledgeable investors in this market space. Our management team is looking forward to working with Larry and Michael to build on our mutual success, leveraging the tremendous knowledge, experience and network of contacts that they offer." Demandware's SaaS-based ecommerce solution enables retailers to meet their ecommerce revenue and profitability goals with a unique combination of merchandising control; the flexibility to adapt ecommerce functionality to meet changing business needs; and the optimal profitability that only a usage-based, Software as a Service-enabled pricing model can provide.

"The Demandware team executed on its vision of developing the first fully customizable, on-demand ecommerce solution," said Larry Bohn, managing director, General Catalyst Partners. "This is a tremendous accomplishment that is further complemented by a terrific customer list that includes Vermont Teddy Bear, Gardener's Supply, Zabars, Ansel Adams and Goldspeed.com, among others. Undoubtedly, Demandware has made significant progress since our initial investment and we look forward to working with the team to increase the company's footprint and continue to deliver the best on-demand ecommerce product in the marketplace." "Delivering an eCommerce platform using a Software as a Service model presents clear benefits to the rapidly-expanding online retail market," said Michael Skok, general partner of North Bridge Venture Partners. "Demandware is spearheading the movement by providing merchants with the merchandising control, flexibility, functionality and interoperability of a full ecommerce application suite with a usage-based pricing model. Demandware's excellent customer traction gives us further confidence in this delivery model and this team's ability to execute." According to Gartner, Inc.'s research report, "Software as a Service Will Be Business Model of Choice by 2008," more than 50 percent of software purchased will be via service by 2008.