mesosphere

Mesosphere raises $73.5M Series C led by HPE, with Microsoft as strategic investor

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Mesosphere, the container-centric company that aims to help enterprises better utilize their data centers with the help of its Data Center Operating System (DCOS), today announced that it has raised a $73.5 million Series C funding round.

The round was led by Hewlett Packard Enterprise (HPE) and also includes previous investors Andreessen Horowitz, Khosla Ventures, and Fuel Capital, as well as new investors A Capital and Triangle Peak partners. What’s maybe even more interesting than this rather impressive list of backers, though, is that Microsoft is also joining this round as a strategic investor.

Both Microsoft and HPE would make logical acquirers for Mesosphere — and there have been reports that Microsoft was interested in acquiring the company last year — but so far, it seems Mesosphere has resisted these advances. While having HPE and Microsoft invest in the same company may seem a bit odd at first, the two companies have recently been working closely together and even announced a formal partnership last December.

We previously reported that Mesosphere was raising this round (and including Microsoft as a strategic investor) at a $600 million valuation. The company has now raised a total of $126 million.

As Mesosphere CEO and co-founder Florian Leibert told me, the company plans to continue to heavily invest in engineering. “That said, traditional enterprises are moving from the ‘old stack’ to the ‘new stack,’ even more rapidly than any of us predicted,” he added. “Take for example, [TechCrunch and AOL parent company] Verizon. They selected the DCOS as their global platform for data center orchestration. These Global 2000 companies demand enterprise-grade sales and support. So while a lot of Series C will fund our deep investments in engineering—to automate every aspect of the datacenter—we will also be investing in our sales and support teams.”

As for choosing HPE as the lead investor, Leibert noted that “combining the Mesosphere DCOS with HPE hardware is an unbeatable proposition and will accelerate the transformation of the datacenter from the old world to the new.” In addition, he also stressed Microsoft’s involvement in this round. “Microsoft, undeniably, has strong commercial relationships with nearly every large company in the world, and we see Azure as one of the key technologies their customers will bring large enterprises to the cloud with hybrid deployments,” Leibert said.

In addition to announcing this new funding round, the company also today launched a new product: Velocity. Velocity is a continuous integration/continuous development tool that was built around the open source Jenkins automation server. Velocity essentially takes Jenkins and combines it with Mesosphere’s  Marathon container orchestration platform to create a highly scalable continuous integration platform. The company argues that a number of companies have already rolled their own platforms based on this combination of Mesos, Docker, Jenkins and other tools and Velocity will now bring this capability to “every type of company.”