VC Firm .406 Ventures Invests in RatePoint $7 million

.406 Ventures is a Massachusetts VC that invests in early stage innovative IT, financial, web infrastructure, digital media and next generation software companies. The company goes back to 2005, when its three founders, who had been working together with another company for years, decided to address a new segment on the market and which had a different approach.

The company, along with Prism VentureWorks and Castile Ventures, has recently offered a Series C round of investment to RatePoint Inc. The company made a total of $23.5 million out of 3 rounds of funding since its launching in 2007. All these rounds include an early seed investment, where many people started to finance small rounds in order to get the company on the right path. All these financings and also the Series A, B and C venture capital funds sum up to $23.5 million.

The $7 million funding comes with the selling equity from the company to the three investors. RatePoint’s Co-founder and CEO, Neal Creighton says that this is the most profitable way to manage this financing, not only for the company, but also for its investors. The investors put their faith in what they invested in and the company puts its faith in them in an equity form. The three investment sources haven’t come as a surprise or not even a novelty, as Neal Creighton has worked with them before and been invested in to put up other companies. So, from all parties they expect this transaction to be a fruitful one.

Jim Counihan, Prism partner, is confident that RatePoint will escalate significantly. RatePoint’s latest financing project was of $10 million in Series B funding at the beginning of 2009.

RatePoint, which was founded in 2007 by executives Chris Bailey and Neal Creighton, is making software for small businesses to manage and publish its customers’ reviews on the websites. The software responds to unhappy clients or bad feedback before they are posted online. The company verifies also the authenticity of the customers’ reviews so that the businesses are aware that they communicate with its client and not somebody else, and it helps businesses develop reviews in order to a larger number of potential clients by facilitating the postings of reviews on Twitter and Facebook.

Prism VentureWorks’s general partner, Jim Counihan, stated that they want to invest in such companies that can bring a unique approach and RatePoint is one of the companies that have proven to do that.