Storage Provider Nutanix Raises $33 Million And Shows Signs Of Readying For An IPO

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Nutanix has raised $33 million in a Series C funding round. The investment comes from investors Lightspeed Venture Partners and Khosla Ventures along with new investors Battery Ventures and Goldman Sachs.

The round gives Nutanix a total of $71 million in funding and positions the company for a potential IPO.

Nutanix plays in the software defined storage space — a relatively new category that reflects the considerable disruption in the overall storage market. Virtualization is so predominant that new forms of storage are required that can store the data from virtual machines.

Enterprise customers have long kept storage separate from the servers – faceless in many respects, administered by different teams that allocate storage as needed. Nutanix takes a different approach. It wraps that storage into commodity x86 servers, helping reduce the space needed for big box storage attached networks (SAN) and networked attached storage (NAS) environments.

Nutanix is riding a wave in convergence that comes as companies seek to consolidate their data centers while also increasing the speed and efficiency needed as data volumes increase in deeply virtualized environments.

The compute, the networking and the storage will increasingly be integrated right into the box itself. The new workloads demand it. Data increasingly moves from virtual machine to virtual machine as loads are directed across vast networks.

SAN and NAS systems from companies like NetApp and EMC have their strident followers but the new requirements of virtualized environments leave an open market for providers like Nutanix.

CEO Dheeraj Pandey said in an interview yesterday the company had a choice to package its technology itself as Apple does or make it available through original equipment manufacturer’s (OEM). They chose to take the Apple route. That has meant building out their own sales network. According to Pandey, the strategy has made it the fastest growing infrastructure startup of the past decade with 150 systems sold and 600 servers deployed with more than 3.3 petabytes of storage.

That growth is in part due to the relationship that Nutanix has with Fusion-io, the wildly popular server attached flash storage provider that is integrated into Nutanix systems.

Fusion-io had its IPO last year. Pandey said you can read between the lines about an IPO for Nutanix. Hiring Goldman Sachs says it all.

Nutanix still faces a steep battle. It will use the $33 million in funding to build a sales and marketing channel network. The company will need it. Nutanix will compete with multi-billion dollar companies such as IBM and EMC. These are companies which have their own plans for the new storage market and the channels to bring those products to market.