Cloudian raises $94 million in series E round, says object storage ‘an idea whose time truly has come’
San Mateo-headquartered cloud storage provider Cloudian has announced it has raised $94 million (£73m) in a series E funding round, hailing it as a validation that object storage is ‘an idea whose time truly has come.’
Cloudian’s business case has been around the benefits of object storage, which provides greater scalability than block storage, as well as favouring unstructured data, with metadata attached to each object more easily identifying and classifying them.
The funding, which for this round included input from Digital Alpha, Goldman Sachs and NTT DOCOMO Ventures among others, is not quite as simple as x raises y. Back in March, the big headline – as this publication duly reported – was that Cloudian had raised $125 million. Indeed it had, from Digital Alpha – but $100m of that was ‘consumption-based financing’ – a financial buffer, if you will – with $25m as equity. This round can be seen as additional to the $25m already raised. Either way, the company’s funding now stands at $173 million.
As the technological landscape matures, with more enterprises looking to move data into the cloud, the benefits of object storage become even clearer. “We’ve seen this space grow significantly,” Jon Toor, Cloudian CMO tells CloudTech, citing recent IDC figures which showed the global enterprise storage market grew 34% during the first quarter of 2018. “The significant growth in enterprise storage year over year indicates there’s a lot of data moving into data centres. People are looking for new solutions.”
The theory is simple but deadly; as Cloudian is built on cloud technologies, the storage can be anywhere. This comes in especially handy when data is collected in a variety of places.
Michael Tso, CEO of Cloudian, explains that the concept of ‘data gravity’ is key. If data has been created somewhere, for instance in a factory or security camera, it is difficult to move large distances. “The need of having cloud-like storage technology, not in some centralised cloud but near where you’re creating this data, because it’s hard to move a lot of it, is one concept why object storage is really needed,” Tso tells CloudTech.
Case in point: Cloudian has recently picked up two leading Formula 1 teams as customers, which exemplifies this approach well. “They keep everything,” explains Tso. “All the data from the sensors in the car, all the practice runs, from all the races, all the video – that data will never get deleted, they can go back for different things, they can simulate and so forth.
“That’s a very good application for what we do – all the data eventually, no matter where it’s stored or where it comes from, is going to end up on a Cloudian platform because that is the final stop.”
From building a grand total of one car per year – well, two if you include both drivers – to millions, another recent Cloudian customer is a leading automotive manufacturer, in the process of being deployed worldwide. “They are using us to store all of the data for their structure automation, sensors, all the designs – it’s a one stop shop for all their data storage,” says Tso.
Perhaps surprisingly for a US-based cloud software provider, Cloudian has been seeing significant traction in Europe – to the extent where the company now has more customers in the continent, with revenues at approximately 50/50. Tso explains that his vision was ‘the world is flat [and] everything is connected’, and so growth was always intended to be organic. “When we started the company, we put one sales side in Europe, one in the US and one in Asia [and told them] – go for it,” he says. “Whoever made the biggest numbers got to hire the next guy.”
The increased importance of data security in Europe, chiefly thanks to the likes of GDPR, has been another boon. “That’s really I think what is driving the forces behind increased adoption of hybrid IT, where we are a key player,” says Tso. “Being able to bridge this cloud and on-prem, being able to control data flow and data access at a very fine granularity.
“Rather than in the public cloud, which has this approach of one size fits all, we’re seeing data security and privacy moving in different directions,” Tso adds. “The leadership of the European industry and government in that area is really driving our expansion into Europe.”
Earlier this year, the company pinned its mark on three trends driving the rise of object storage in 2018; the growth of artificial intelligence and the Internet of Things, massive data growth, as well as the rise of Amazon S3’s API as an industry standard. It would appear investors agree. “We believe Cloudian is well positioned to dominate the next generation of enterprise storage with its elegantly simple design that integrates both the data centre and cloud environments,” said Edouard Hervey, managing director at Goldman Sachs in a statement.
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