Silverback Hoists $16M

Network Appliance joins Intel in bankrolling the storage processor and HBA startup

April 26, 2006

4 Min Read
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Processor startup Silverback Systems has clinched $16 million in new investments, with Network Appliance jumping on board to help fund 10-Gbit/s enhancements to the vendor's adapters and chips.

Today's investment brings Silverback's total funding to $51 million since the Campbell, Calif.-based firm was founded in 2000. Silverback clinched $15 million in Series C funding back in 2003, and landed an undisclosed sum from Intel the following year.

It's not done yet. The startup's CEO Ahmet Houssein told Byte and Switch that today's round is part of an ongoing push to bring in more cash. "We have another round that we will raise shortly as part of the process of getting funds into the company," he said. "I suspect that in the next six to nine months we will be driving at closing that extra funding.

Harry Petty, Silverback's VP of strategic marketing and business development, says the new funds will be used to boost the firm's marketing and development efforts, with the launch of new 10-Gbit/s adapters, chips, and software expected by the middle of this year.

"This ensures that Silverback has the financial strength to deploy the ten-gig technology we have in development," Petty explained. He added that the new 10-Gbit/s iSnap technology will essentially "slide" into the vendor's existing designs as a hardware upgrade.As to customers, Silverback has already signed OEM storage deals with vendors such as Vitesse, Qsan, and Montillio, with Network Appliance potentially joining the list. (See Silverback, Vitesse Support iSCSI, Silverback Powers Qsan, and Silverback, Montilio Join Up .) "They've been evaluating and looking at our product," said Petty. "Netapp recognizes us as an ecosystem partner trying to make ten-gig iSCSI possible."

Despite the big plans, though, Petty confirmed that Silverback has not realized much revenue from its products at this point. The startup is clearly counting on the emergence of the 10-Gbit/s market within the next few months.

It's not alone in this. Other component suppliers, potential competitors, are also keeping up the 10-Gbit/s drumbeat. (See iVivity Unveils 10-Gig HBA, and NetXen Singles Out 10-Gig.) Last week, Emulex flashed its cash to acquire Aarohi, in part for its 10-Gbit/s technology, and SolarFlare announced a merger with Level 5 Networks, which will result in a new company focused on 10-Gbit/s development. (See Emulex Buys Aarohi and SolarFlare, Level 5 Team.)

Network Appliance is not the only big-name vendor with a financial stake in Silverback's future. Intel is already an investor in the startup, along with Gemini Israel Fund, Newbury Ventures, Pitango Venture Capital, and U.S. Trusts Excelsior Venture Partners.

Silverback's flagship technology is its iSnap 2110 processor, a network acceleration chip the startup is aiming at vendors of iSCSI storage devices, NAS appliances, blade servers, and multiprotocol storage routers.In addition to the processor, the startup also offers an iSCSI HBA for server and workstation applications, which is built around the 2110 iSnap technology.

"With ten-gig, there's certainly a network acceleration problem that needs to be solved," said Petty. "Storage over Ethernet in ten-gig is something we think we can do really well."

This could be a good move. The storage processor and TOE market is an elephant's graveyard for startup firms, with the likes of Xiran, iReady, and Trebia all biting the dust. (See Xiran Gets Crossed Out, iReady to Go, Nvidia Buys iReady, and Trebia Croaks.)

Silverback has also struggled with 1-Gbit/s TOE chips, mainly because there has been little need for those products, thanks to the fact that Microsoft has a free software initiator that does the same thing.

The market for 10-Gbit/s technology, however, could be a different matter, and there's expected to be more need for offload cards with 10-Gbit/s capabilities. Though "when" remains a question. Despite a flurry of activity among component vendors, actual market demand appears to be hesitant. Users at this stage aren't quite ready to pony up to 10-Gbit/s Ethernet storage networking. (See 10G Supply Exceeds Demand.)— James Rogers and Dave Raffo, Senior Editors, Byte and Switch

Organizations mentioned in this article:

  • Aarohi Inc.

  • Emulex Corp. (NYSE: ELX)

  • Gemini Israel Fund

  • Intel Corp. (Nasdaq: INTC)

  • Level 5 Networks Inc.

  • Microsoft Corp. (Nasdaq: MSFT)

  • Network Appliance Inc. (Nasdaq: NTAP)

  • Newbury Ventures

  • Pitango Venture Capital

  • Qsan Technology Inc.

  • Silverback Systems Inc.

  • SolarFlare Communications Inc.

  • Vitesse Semiconductor Corp.

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