Mason Raises $25M to Help Software Firms Deploy, Manage Applications

Amazon Web Services and other businesses that charge customers to host their software applications have become a popular option for tech startups. Part of the reason for the popularity of using AWS and other cloud computing services is because it allows employees at early-stage businesses to focus on their products and customers, rather than server space and processing loads.

Mason, a Seattle-based startup, is seeking to carve out a niche in an area of the software industry it calls “mobile infrastructure as a service,” according to Jim Xiao, its founder and CEO. That could involve deploying and managing software applications across thousands of connected devices—networks of credit card readers or shipping label scanners, for instance, Xiao says.

On Wednesday, Mason announced it raised $25 million in new funding to support product development and make new hires. New York-based Coatue Management led the Series A financing round, which Xiao says gave Mason a valuation in the range of $100 million to $125 million. Other participating investors included GGV Capital and Base10.

To explain how businesses might use Mason’s software to build and scale their own applications, Xiao uses the hypothetical example of an established bicycle manufacturer that decides it wants to create a stationary bicycle to rival those sold by Peloton, the popular indoor bike company. Peloton outfits some of its training cycles with large, Internet-connected displays, which it says blends the feel of an in-person exercise class with the convenience of not having to leave the house.

“If you wanted to compete against Peloton, you’re already tens of millions of dollars behind” when it comes to investing in research and development, Xiao says. “You’d need to hire dozens of engineers, and you’re probably two to three years from actually going to market. By then, Peloton would have left you in the dust,” he says.

If Mason were to team up with a bicycle manufacturer to try and build a Peloton competitor, the startup would likely focus on developing the display screen and the equipment’s software-enabled parts, while its client would stick to its bread and butter, designing and building the frame, wheels, and other traditional bicycle components, Xiao says.

Another real-world example that illustrates the importance of mobile infrastructure is the software upgrades Tesla (NASDAQ: TSLA) gives its cars periodically, Xiao says. These tweaks can make the cars faster, improve battery life, and make the software systems less vulnerable to hacks, among other improvements.

Xiao founded Mason in 2015. He’s a University of Washington graduate who worked for Microsoft (NASDAQ: MSFT) in Beijing before returning to the US and taking a job as an analyst at Detroit Venture Partners, where he worked until 2014. Xiao says Mason gets a lot of electronics and other supplies from China, which it uses to build products for customers.

Mason allows customers to pick from what Xiao calls a “portfolio of hardware” that encompasses different screen sizes and types of equipment. The company has plans to expand its hardware offerings by adding smart watch components and “embeddable devices you can put into vehicles or grocery carts,” he says.

Mason is not seeking to displace services like AWS, Google Cloud, and Microsoft Azure, which have low-cost, low-hassle cloud hosting offerings, Xiao says. Instead, he predicts services like Mason that provide mobile infrastructure will sit alongside the tech giants as smartphones and other mobile devices proliferate and more attention turns to “edge computing.”

“We see them as future partners,” he says of the leading cloud services. “They are the divines that we dance among. [Cloud computing services] are hungry for more compute on the edge, to make need of the cloud. We see this symbiotic need for devices on the edge to complement what the innovations in the cloud have created.”

Xiao declined to name any of Mason’s customers. The startup’s revenues in the first three months of this year were more than $5 million, he says.

Mason currently has 24 employees, and Xiao says he expects the company’s headcount to double by the end of 2019.

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