Palamida was founded in 2003, with venture financing of $5 million from Hummer Winblad Venture Partners. Founders Jeff Luszcz, Theresa Bui-Friday, and Ray Waldin had previously worked together at Cacheon, Inc. The team had experienced a situation in which open-source software was used within the product’s kernel, which required remediation in order to comply with a potential acquirer’s policy for use of open source. That experience culminated in the founding of Palamida Software. Mark Tolliver, formerly Executive Vice President of Marketing and Strategy at Sun Microsystems, joined Palamida in May 2005 as President and CEO.
