3ware Set for Fourth Round

IP storage startup set to close fourth round of funding as it releases second-gen product

August 3, 2001

3 Min Read
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3ware Inc., an IP storage vendor, expects to close a fourth round of funding within the next 30 to 45 days, the company told Byte and Switch today. The financing will come as 3ware releases the second generation of its IP storage system, retuned in response to customer feedback.

The Palisade 100 is essentially a miniaturized version of the older Palisade 400,” says Beau Vrolyk, CEO of 3ware. “We made the box much smaller and reduced the power and heat, as this is what companies asked us for."

Like the 400, the Palisade 100 contains an Ethernet switch and the capacity to hold multiple terabytes of storage. It can be used as a network-attached storage system on an Ethernet network or form part of a SAN.

Like the highly anticipated second album from a favorite band, 3ware has a lot riding on its new product. It has listened to all the positive and negative criticism from its fans and created what it hopes will be a good follow-up. Now it has to wait and see if anyone likes it.

So far, the reviews have been favorable, 3ware says. It claims to have installed 50 Palisade 100s at customer premises, including Conservor, FinTech, and the University of Utah -- though it is worth noting that not all of the boxes were shipped for revenue, and some are trial units.3ware appears to be months ahead of most of its major competitors. Hewlett-Packard Co. (NYSE: HWP) and IBM Corp. (NYSE: IBM), for instance, are not expected to start shipping iSCSI-based storage boxes until early 2002.

3ware's engineering team had to compromise on some features in order to get the size of the new product down. For example, hot-swappable disk drives are not available on the new version. Getting rid of this and other minor features meant 3ware could reduce the physical size of the box by 75 percent (from 4U down to 1U).

The vendor also reduced the power consumption of the system by 50 percent by “spinning down disks” -- shutting them down temporarily when they are not in use.

The new product burns 250 volts of power. That's around half as much as the 400 -- and one quarter of the current required by conventional high-end storage arrays, 3ware says. That can lead to substantial savings in power costs, says Vrolyk. "In California, you would save $37,000 over five years. The [Palisade 100] costs $20,000, so it pays for itself in electricity savings."

For anyone who’s really keen on having hot-swappable disks, 3ware plans to continue selling the older system as well.The company still faces a challenge on the standards front, as iSCSI (SCSI over IP) has yet to be ratified. But with Cisco Systems Inc. (Nasdaq: CSCO), HP, IBM, and Intel Corp. (Nasdaq: INTC) behind it there’s little doubt it will be.

Still, Vrolyk contends these big companies slow down the process. “They don’t want the standard to be finalized yet, as they haven’t got a product to market until early 2002,” he says. Once it is approved, 3ware’s current “best approximation” of iSCSI will be upgraded to the standard version for free, the company says.

The funding round is expected to include all 3ware’s current investors: New Enterprise Associates (NEA), VantagePoint Venture Partners, and Veritas Software Corp. (Nasdaq: VRTS), among others, plus some new ones.

— Jo Maitland, Senior Editor, Byte and Switch http://www.byteandswitch.com

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