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Monday, May 1st, 2017

Storage

HPE bankrolls software-defined storage startup

IBM, Box to provide enterprises with option to store data regionally in Europe and Asia

Hewlett Packard Enterprise (HPE) has bankrolled software-defined storage startup Hedvig, joining other investors in a US$21.5 million round to grow the new company.

The two-year-old vendor provides software-defined storage for enterprises building private, hybrid, or multi-cloud environments. The Hedvig Distributed Storage Platform consolidates block, file, and object storage into a single, API-driven platform.

With a total of US$52 million in financing to date, Hedvig said it will use the latest round of funding to expand into new markets, develop cloud and backup solutions for large enterprises and grow its engineering, sales and channel teams.

"All sectors of enterprise IT are being hit by new demands from the massive wave of emerging digital businesses. It's a wake-up call for the storage industry and a signal that a flexible, simple software-defined storage solution is needed for primary and secondary storage in the era of cloud," Hedvig founder and CEO, Avinash Lakshman, said.

"This investment round is a testament to the hard work and dedication of the Hedvig team. We'll build on our early customer success in key financial services, service provider, manufacturing, energy and retail markets by continuing to innovate in both cloud and backup capabilities. With this latest investment, we are poised to grab the No. 1 spot in the fragmented software-defined storage market."

The HPE connection is significant, with it’s CTO of the Data Center Infrastructure Group, Milan Shetti, serving as a technical advisor to Hedvig.

Shetti’s new advisory role marks the second time he has worked closely with a vendor start-up that HPE eventually acquired. In 2009, he was president and CEO of file-serving data management and protection software company, Ibrix, when it was bought by HPE.

HPE’s investment in Hedvig follows multiple storage vendor acquisitions made this year, including hyper-converged infrastructure company, SimpliVity in January and most recently, all-flash storage array developer Nimble Storage in March.

As reported by ARN, the planned US$650 million acquisition of SimpliVity was designed to expand the tech giant’s leadership in the growing hybrid IT industry, while tapping into a hyper-converged market expected to reach US$7 billion by 2020.

At the time, HPE president and CEO, Meg Whitman, said the transaction would expand HPE’s software-defined capability and the merger “fit squarely” within HPE’s strategy to make Hybrid IT simple for customers.

“More and more customers are looking for solutions that bring them secure, highly resilient, on-premises infrastructure at cloud economics. That’s exactly where we’re focused,” she said at the time. Technology Business Research, senior analyst, Krista Macomber, foreshadowed further vendor consolidation, in observing at the time that HPE’s SimpliVity buy reflected the need for agile innovation and selling models in a disrupted data centre market.

She said the two companies combined, generated approximately 20 per cent of global hyper-converged platforms revenues during 2016, trailing market revenue leader Nutanix but outpacing the remaining range of pure play and multiplatform peers, such as Pivot3 and Dell Technologies, on a combined basis.

Similarly, the recent acquisition of Nimble Storage reflects another significant notch of competitive consolidation in the data center space, according to Macomber.

“Immediately upon closing, Nimble’s all-flash array portfolio would fill a market gap for HPE between entry-level and enterprise-caliber offerings,” she said at the time. “From a longer-term perspective, HPE will tap Nimble storage innovation to significantly bolster its solution sets around hybrid IT.

However, while the ongoing acquisition spree is likely to quickly and significantly advance HPE’s market traction and innovation in critical corners of the data center market, Macomber warned such a strategy could create the potential threats of “scattershot” branding and customer and partner confusion that she suggests will be critical for HPE to manage.