Accel Debuts $100M Fund To Invest In Disruptive Big Data Companies

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Accel Partners has steadily been making investments in infrastructure and companies looking to manage big data for the enterprise, including funding Cloudera, CouchBase, and even Fusion-IO. But there’s no doubt that more and more startups are launching to help businesses manage massive amounts of data as technologies like Apache Hadoop become more popular. Today, Accel is launching a $100 million fund dedicated to investing in entrepreneurs who are building disruptive big data companies.

This is actually the first dedicated fund to a specific vertical in Accel’s history as a venture firm. The fund, which is made up of Accel’s existing capital, will be devoted to funding innovation across entire “big data stack” from infrastructure (storage, security, management, etc.) to enterprise applications (business intelligence, collaboration, mobile, vertical apps, etc.).

The ‘Big Data’ fund will be managed by multiple Accel partners in US, Europe, China, and India, including Ping Li, Rich Wong, and Andrew Braccia. Accel will also be partnering with thought leading big data advisors such as data scientists, software entrepreneurs, technologists and researchers to serve as a ‘guiding light’ to help think through investments and track entrepreneurs doing interesting things in the space.

Lee expects the fund to make eight to ten investments in big data companies. The investments will include everything from seed stage, Series A to growth funding in later-stage companies. The fund will also be working with Accel-backed Cloudera, which commercially distributes products using Apache Hadoop, and their partners to foster a community around big data. And Accel will be holding a gig data conference in the Spring of 2012 to network and drive deeper discussion on technology trends in the space.

There’s no doubt that venture investment has picked up in big data companies of late but data-focused enterprise companies have been around for some time. So it’s interesting that Accel chose to launch the vertical-specific fund now.

Li compares to evolution of big data to the iPhone ecosystem. Apple created the phone, built iOS, developed the platform, and then this huge app ecosystem was born. He says that the big data space is at a similar stage where the foundational technologies such as Apache Hadoop have been built, and now companies have been given new way to manage big data.

Li says that although consumer internet companies are more “visible”, there’s a real undercurrent of “picks and shovel” innovation to tackle the big data problem for these companies. As data volume is exploding and new data types, such as unstructured and semi-structured, are breaking traditional data platforms like existing relational databases. Lee says frankly, “Data now comes from all directions and this massive amount doesn’t necessarily fit nicely in an Oracle database.”

Technologies like Hadoop are becoming mainstream and providing a platform for more of these “native” big data applications and services to emerge and attract attention from companies that are producing this massive amount of data. And there’s no doubt that there is a flux of data, especially as user-generated data continues to grow as well as machine generated data. For example, the rapid adoption of smartphones and mobile platforms is producing massive amounts of machine generated data.

Basically, Accel’s belief is that there is a huge market opportunity still on the table in building transformative big data solutions. And new applications such as mobile, commerce and gaming will require data-intensive platforms that didn’t exist in the past. Lee explains that this Big Data wave will usher in a new era of multi-billion software companies, similar to the Symantecs of the past, that solve existing problems differently or new problems previously unthinkable.

Photo Credit/Flickr/Kevin Krejci