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For Hyperconvergence Vendor SimpliVity, a Customer Becomes a Funder

The company gets a new round of cash, raising its value to more than $1 billion.

Here's one avenue to getting your technology startup funded: Have a venture capital firm in a position to fund your company use your products with good results. That's what happened with hyperconvergence vendor SimpliVity Corp., which got a huge cash infusion to raise its market cap to more than $1 billion.

SimpliVity announced the series D funding in a press release yesterday. The total round of funding was $175 million, of which $150 million came from investment firm Waypoint Capital. "Waypoint was inspired to make the investment after transforming its own IT environments across five global sites with SimpliVity's hyperconverged infrastructure solution," the press release stated.

Waypoint's CIO/CTO Frederic Wohlwend said the company was convinced of SimpliVity's potential through the way the SimpliVity flagship product, OmniCube, transformed the IT infrastructure of Waypoint.

SimpliVity has been in the market less than two years -- it started selling products in April 2013 -- and has already amassed a total of $276 million in venture funding. SimpliVity CEO Doron Kempel said in a blog entry that his company posted a year-over-year sales increase of nearly 500 percent.

SimpliVity describes OmniCube as an appliance that incorporates all aspects of IT infrastructure, including processing, storage, networking and management, into one box. It "assimilates all IT infrastructure below the hypervisor -– as many as eight to 12 disparate datacenter products –- into a single building block of shareable resources, in a 2U form factor," the company states.

SimpliVity claims that customers using its products see gains of up to 100-to-1 or better data efficiency, and 50 percent better performance. OmniCube is positioned as, among other uses, a cloud computing solution, ideal for public, private and hybrid clouds.

SimpliVity is one of many contenders in the emerging hyperconvergence space. Others include Nutanix, VMware Inc. with its EVO: RAIL partners, Scale Computing, Pivot3 Inc., Maxta Inc. and Nimboxx Inc.

About the Author

Keith Ward is the editor in chief of Virtualization & Cloud Review. Follow him on Twitter @VirtReviewKeith.

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