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Qumulo closed a $93 million funding round today, giving the scale-out file storage vendor “fuel” to compete with the established players in a rapidly expanding market.
BlackRock Private Equity Partners led the Series D round, which brings Qumulo’s total funding to over $220 million. Goldman Sachs and Western Digital also participated in the funding, along with previous Qumulo investors Highland Capital Partners, Kleiner Perkins Caufield & Byers, the Madrona Venture Group, and Valhalla Partners.
Qumulo CEO Bill Richter hinted that this may be the last venture funding the company will need.
“This will fuel the company’s growth for many years to come,” Richter said. “This is enough fuel that we need for the foreseeable future, which is important in this industry.”
He said Qumulo will use the funding to add sales and marketing people, and “especially code-writing engineers” to enhance the Qumulo File Fabric (QF2) software. He sees the market as ripe for software-defined and cloud-based NAS storage in the wake of fast-growing file data driven by technologies such as artificial intelligence, machine learning and 4K video.
Richter said Qumulo is innovating with QF2’s analytics and the ability to run in the cloud, while the established NAS products from NetApp and Dell EMC Isilon are stagnating. Qumulo’s founders were original Isilon developers, and Richter was president of EMC’s Isilon division for three years. He became Qumulo CEO in November, 2016.
“The last generation of storage was all about the box,” Richter said. “The next generation is about the data and the place where data lives. How can we allow customers to interoperate between the public and their private cloud for a true hybrid experience? And how can they really understand their data and not just their storage? Legacy guys, which I was part of for many, many years, were just churning out more boxes.”
Richter said Qumulo has hundreds of customers, including nine leading movie studios and Fortune 500 companies. He said Qumulo will use the funding to grow aggressively from its current 180 employees, although he declined to share specific hiring goals.
Richter also said the funding from Black Rock and Golden Sachs does not mean an initial public stock offering is a short-term goal.
“Eventually that might be in the cards, but now we’re focused on growing Qumulo and creating a long-term sustainable business,” he said. “Don’t expect us to try and put ourselves out to the public market at the first opportunity.”
Despite the cash infusion, Qumulo still faces large challenges. The vendor is far from profitable and is battling giants NetApp and Dell at the top of the market as well as other cloud file system startups such as Elastifile, WekaIO and Quobyte. Object storage vendors are increasingly adding file systems to their products as well.
And despite citing multi-cloud as a big selling point, Qumulo only supports AWS now. Richter said Microsoft Azure and Google Cloud Platform support is on the way. Qumulo is also exploring more hardware partnerships, such as its deal to sell its QF2 on HPE Apollo servers.
“Customers want a better, more modern choice,” said Richter, who now has the funding to fuel those code-writing engineers to help develop that modern file system.