Software houses make moves that may be preludes to IPOs.

Two local software companies have taken steps that position them better for possible future initial public offerings. Canoga Park-based E Team Inc., a provider of crisis-management software, last week beefed up its management team, while El Segundo-based iRise Inc. received $15.8 million in late-stage funding and added a venture capitalist to its board.

E Team elevated John Tullie, who joined the company as a vice president in 2002, to chief executive, and named venture capitalist Lawrence Jordan as its board chairman. It also brought two other software industry veterans onto its board.

Top-loading the management team of a young company is often a signal that it's preparing to take its shares public, but Tullie--who helped bring Irvine-based Continuus Software Corp. to an IPO in 1999--said E Team has no 1PO plans at the moment. "Obviously at some point down the road, it's not out of the question," he said. (Continuus is now owned by Telelogic AB of Sweden.)

E Team's software allows emergency responders to coordinate with each other in times of crisis. The company points to its rapid expansion during 2004 as reasons for the management change: E Team was heavily involved in the Summer Olympics in Greece, and handled emergency coordination for the March G8 Summit in Sea Island, Ga., in addition to working both the Republican and Democratic National Conventions. It's expanding into the European market and has been working with the Thai government in its Tsunami disaster response efforts, Tullie said.

Though the company does not disclose financial information, Tullie said the company was profitable in all four quarters of 2004.

Meanwhile, iRise raised $15.8 million from Morgan Stanley Venture Partners and named venture capitalist Brooke Seawell to its board.

Based in Menlo Park, Seawell previously worked at Synopsys Inc., which he helped take public in 1992, and at NetDynamics, where he helped arrange an acquisition by Sun Microsystems Inc.

IRise makes products that allow custom software applications to be simulated and tested before clients have to invest in the expense and time of actually writing the software code. The closely held company does not disclose revenues or profitability numbers, but managed to raise $28 million in funding from 2001 to 2004. Its 100-customer portfolio includes Sprint Corp., Boeing Co., Bank of America Corp., AIG and Home Depot Inc. Morgan Stanley Venture Partners is its first institutional investor.

Gartner Inc. research director Matt Light said he expects the Morgan Stanley investment to spur other similar deals. "You see a substantial investment like this, and there will be a flurry of other small companies following on the heels of innovators like iRise," Light said.