Verari Speeds Off With $20M

Blade startup's coffers top $50 million as CTO plans power savings

June 6, 2007

4 Min Read
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Blade server and SAN startup Verari continues to pull in the cash, picking up $20 million in funding earlier today as it attempts to make its technology more environmentally friendly. (See Verari Picks Up $20M.)

The C round was led by Carlyle Venture Partners, along with Voyager Capital, Sierra Ventures, and an unnamed strategic investor, bringing the startup's total funding to more than $50 million. (See Verari Bags $13M .)

Verari CTO David Driggers told Byte & Switch that the Series C could also swell to $25 million. (See Wright to Lead Verari.) "The main reason will be to allow room for a second strategic investor," he says, adding that the additional $5 million, along with the identity of the mysterious backer, will be made public within the next 30 days.

A sizeable chunk of the cash influx has already been earmarked for what Verari describes as "energy-saving technologies". Specifically, the startup is planning to overhaul the power module that fits into its blades and storage systems. "The current one supports high voltage A/C, [but] the follow-on product will support both high-voltage A/C and high-voltage D/C," says Driggers, adding that this could shave 10 to 15 percent off users' power consumption when launched early next year.

Blades have been a source of concern for many IT managers, with users citing power and heat issues associated with their high-density form factor. (See Blades Still Too Hot, Summer Storage Survival, Data Center Heat Wave, and Vegas Blade Warning.)A number of vendors are focusing their attention on this issue, such as Sun, HP, and IBM, which recently launched "Project Big Green," an initiative to improve data center power and cooling, tied closely to virtualization and blade servers. (See Green Grid Addresses Efficiency, HP Boasts Cooler BladeCenter, Big Blue Launches Big Green, and IBM Deploys 'Low Carb' IT.)

Other firms have forged alliances with power companies, such as Copan and Pacific Gas & Electric, offering financial incentives to PG&E customers that buy MAID gear from the storage vendor. (See Copan Pushes Power Savings, Copan Validates MAID, and SNW: First Take.)

At least one analyst warns that it will take more than just a single box to solve firms' data center energy issues. "A lot of vendors are trying to approach this in a point-product kind of way, [but] it needs a much more holistic approach," says Charles King, principal analyst of Pund-IT Research, adding that firms need to think about their overall data center design.

Other products on the Verari roadmap include a workstation blade slated for launch later this month and a desktop blade in Q3. The vendor is also planning to increase its headcount from 250 to over 300 by the end of the year, largely in sales and support.

The last year has been a busy one for Verari, which has fleshed out its blade family, added 4-Gbit/s connectivity for its storage systems, and announced an OEM deal with PolyServe (See Verari Adopts AMD, Verari Intros VB5150, Verari Goes 4-Gig, and Verari Teams With PolyServe.) This followed moves into the InfiniBand arena and OEM deals with Engenio and Panasas. (See InfiniBand Natives Stirring, Verari Ships InfiniBand SAN, and Verari Goes Off the Rack.)In the blade arena, Driggers says that Verari's main rival is HP, suggesting that users are buying into the idea of servers and storage in the same blade chassis. (See HP Brandishes Blades, HP Adds Storage Blade, HP Announces Win, HP Gets Blade Switch, and HP Storage Sneaks Up.) "Without question, it's HP and the c-Class," he says. "It's the only other product on the market that is trying to do what we do, which is to put servers, storage and workstations in the same form factor."

This could represent the biggest challenge for Verari, despite its claims to possess the highest density storage on the market. (See Verari Intros VB5150.) Although Verari has over 100 customers, the startup lacks the market reach of HP, which offers a slew of printing, laptop, and workstation technologies in addition to servers and storage.

Undeterred, Driggers told Byte & Switch that Verari is within striking distance of profitability. "The company will be cash flow positive in the second half of '07," he says, adding that no other funding rounds are planned.

James Rogers, Senior Editor Byte and Switch

  • The Carlyle Group LLC

  • Copan Systems Inc.

  • Engenio Information Technologies Inc.

  • Hewlett-Packard Co. (NYSE: HPQ)

  • IBM Corp. (NYSE: IBM)

  • Panasas Inc.

  • PolyServe Inc.

  • Pund-IT Inc.

  • Sierra Ventures

  • Sun Microsystems Inc. (Nasdaq: SUNW)

  • Verari Systems Inc.

  • Voyager Capital

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