Groove cuts staff

Collaboration software maker Groove Networks has cut 20 percent of its workforce and closed a $38 million financing round, the company said this week.

Groove Networks laid off 58 workers in a reorganization of its sales, marketing and services units that is intended to cut costs. The majority of the cuts were made at its Beverly, Mass., headquarters, the company said.

Groove Networks cited extended software sales cycles for large enterprises as a catalyst for the layoffs. Founded five years ago by Lotus Notes creator Ray Ozzie, Groove Networks develops desktop software for sharing information such as e-mail, documents and application data throughout an organization.

The company also announced the new funding round, its fifth. All existing investors participated in the round, including Microsoft, Intel and Accel Partners, Groove Networks said.

The new funds, which will be used for ongoing operations, bring to $155 million the total invested in Groove Networks since its creation.