The Funding Faucet Is Wide Open for Hyper-converged Businesses

ESG Senior Analyst Colm Keegan and I have been furiously fielding inquires on whether to go converged or hyper-converged. The answer, according to SimpliVity CEO, Doron Kempel, is, well, simple: Why settle for an incremental approach to infrastructure convergence when you can achieve true IT transformation through a fully hyper-converged solution

Fresh off a $175M series D funding round and a $1B valuation, SimpliVity seems poised to potentially cause serious disruption to the storage industry. To be sure, SimpliVity is still a emerging company, however, in the 23 months that this upstart has been shipping product, it has had impressive success with companies of all sizes. SimpliVity's initial focus will be in mid-market accounts where they have been seeing an average sales cycle of approximately two months--a startlingly fast sales cycle given the impact and the long sales cycles we are seeing with other converged infrastructure vendors.

SimpliVity's success seems to be tied to two primary factors. First, the SimpliVity "Omnicube" offering can consolidate server compute, networking, storage, backup, cloud gateway connectivity, and WAN optimization resources into a highly compressed 4U form factor. Traditional IT architecture, by comparison, can typically occupy 10x the amount of space (20U) for the same capabilities. The second factor is savings--both from a CapEx and an OpEx standpoint. Kempel states that SimpliVity customers are typically seeing a TCO that is up to 3x less than legacy IT architecture. Moreover, with less physical infrastructure to integrate, deploy, and manage, overworked and understaffed IT departments can get more accomplished in less time and possibly even leave the office at a reasonable hour. 

Kempel attributes SimpliVity's unique hyper-converged capabilities to 43 months of concentrated product development. As an example, one of SimpliVity's big differentiators is its inline deduplication architecture. An onboard accelerator card enables the OmniCube appliance to deduplicate primary data inline without impacting application performance. As a result, IT organizations can store up to 10+ times more data on disk than conventional primary storage platforms. This data can then be leveraged for both primary data and backup storage retention to facilitate rapid data recoveries. An Omnicube system configured with 10TB of disk capacity is capable of storing up to a whopping 1PB of information. The Omnicube offering can also efficiently replicate data to a secondary facility, for DR purposes, by further optimizing deduplicated data transfers through the embedded WAN optimization technology on board the appliance. 

SimpliVity's market timing could be quite fortuitous. According to ESG research, many IT organizations still continue to struggle with managing data growth, improving backup and recovery, and increasing server virtualization density in their environments. The time and effort spent trying to keep the IT house in order not only has significant hard dollar costs associated with it but also lost business opportunity costs. If IT organizations have to spend the majority of their time managing infrastructure, it could leave little time to innovate and work on initiatives that are more strategic to the business. SimpliVity's hyper-converged solution can kill two birds with one stone: reduce the management burden on IT while significantly driving down the costs of primary and backup storage capacity. This should spell welcome relief for many organizations struggling under the weight of their growing virtualized application environments. 


Mark Bowker

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