Copan Sweeps Up $25M

Maker of enterprise backup array secures generous second round of funding

August 31, 2004

3 Min Read
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Who needs a MAID? Copan Systems Inc. hopes data centers do, now that it has bagged a cool $25 million in Series B funding to more aggressively peddle its MAID (massive array of idle disks) enterprise backup device.

The round was led by Pequot Ventures, which is a new Copan investor and will pick up a seat on the company's board. Also participating in the round were two holdovers from Copan's $14 million first round, Austin Ventures and Globespan Capital Partners, as well as Pinnacle Ventures.

The company's flagship product, the Revolution 200T, is a high-density disk device that aims to replace tape libraries for data backup and archiving (see Copan Takes Aim at Tape). The device began shipping for early adoption in April and is now generally available (see Copan Launches Disk Backup and Copan Announces GA for Revolution ). So far, according to Copan, 11 Revolution 200Ts have been installed by customers in the financial, federal government, service provider, and media sectors.

Much of Copan's new funding will be used to improve on that number. The company plans to expand from 52 to 80 employees by year's end, largely through the addition of sales and support staff in the U.S., Europe, and Asia.

"Our investors want us to get out to market rapidly," says Camberley Bates, VP of business development and marketing at Copan. "We're looking at how we scale the company."To carry out that mandate, Copan will have to sell not only its product but also a concept. The MAID approach was developed by computer scientists at the University of Colorado. The idea is to power the drives in an array up and down to save energy costs and extend the life of the disks.

Copan's MAID architecture relies on proprietary algorithms to monitor and minimize activity of drives in the array, thereby reducing power consumption and implementation costs, according to the company. The Revolution 200T is priced at $3.50 per gigabyte, compared with $8 to $30 per gigabyte for other disk-based products, says Bates.

However, MAID vendors have yet to make significant inroads. "Acceptance has been slower than we had hoped," says Chuck Larabie, VP of marketing and sales at Asaca/Shibasoku Corp. of America (ASA), which uses MAID in its Firefly DM series.

Larabie blames the declining cost of all disk-based products as an inhibitor to MAID adoption. "Disk is cheap," he says. "Until customers start feeling the pinch of power costs, we're not going to fight in the gutter with those products."

Copan execs insist that demand for their product is high. "The pipeline is strong -- it's a list of Who's Who in Fortune 500 companies and government institutions," says Bates. "We have several multi-petabyte opportunities."Copan's hefty B round would seem to validate that claim. Pequot Ventures drew the same conclusion on the product's potential as Copan did, says Eric Sumpter, founder, COO, and VP of manufacturing at Copan. "The implied message is to execute well and capitalize on that."

Beyond that, Copan will use its second round of funding to ramp up product development and manufacturing. Product plans include new software for data and policy management, enhancements to existing functionality, and, eventually, smaller versions of the product.

The company hopes these plans will take it through profitability, rather than requiring additional investment.

Brett Mendel, Senior Analyst, Byte and Switch Insider

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