10 Hot Networking Companies With IPO Potential12:48 PM EST Fri. Apr. 02, 2010
Ruminating on initial public offerings (IPO) is little more than idle speculation. Market conditions change all the time, the venture capital (VC) community is sometimes tough to keep up with, and many companies end up acquired long before their IPO potential bears fruit. But thanks to the success of Meru Networks' IPO earlier this week -- and other companies, such as Force10 Networks, gearing up for IPOs of their own -- the spotlight is back on this corner of the industry again.
Here are 10 companies in the networking space worth keeping an eye on in the next few years. All have not only drawn appreciative nods from the world of finance, but also have robust channel programs and more solution provider converts every year.
Aruba Networks and now Meru Networks have both seen successful IPOs, which bodes well for Ruckus: as popular a new vendor in the networking channel as we've seen in some time. Within the past year, the company moved upmarket from its SMB base and introduced new versions of its hot ZoneFlex products for enterprises and midmarket customers alike, as well as revamped its channel program to offer greater incentives to its most loyal VARs. They've been making noise in the channel for a few years now, and it's getting louder all the time.
Not only is Palo Alto CEO Lane Bess confident in his company's IPO potential, but he'd also be happy to state Palo Alto's goal for seeing it through: next year. The growth of Palo Alto, whose disruptive firewall technology gives users control and visibility of applications and content by user, not by IP addresses or ports, has been astounding in the past two years, and the company motored through the economic downturn with the wind at its back. Its channel partners are, to put it mildly, impressed with the vendor's channel acuity, and Bess himself assured Channelweb.com in a recent interview that Palo Alto will be an IPO for certain, with no plans to let the company be acquired before that happens.
Springtime has been a happy time for Vidyo in each of the past few years. The upstart videoconferencing vendor secured $15 million in venture capital funding in March 2009, with CEO Ofer Shapiro telling Channelweb.com at the time that the company expected to triple its growth last year. Fast forward to April 2010, and Vidyo is again a darling of the VC community: on April 1, it announced another $25 million round of Series C financing. At the very least, the established titans of the video space -- your Ciscos, Tandbergs and Polycoms -- know its name and won't soon forget it.
Since its founding four years ago, Agito Networks has been focused on unified communications products that aim to seamlessly extend a business' PBX and UC infrastructure to mobile devices. International cell phone costs being what they are, the technology has been embraced by enterprises and service providers looking to save money and get all the bank-for-the-buck they can out of their mobile networking infrastructures. The explosion of mobile opportunity isn't going away any time soon, so neither is Agito, which has built out its channel programs and drawn interest from venture capital investors, through whom it received $13 million in Series B funding in April 2009.
How about that Vyatta, which has been earning plaudits for its virtualized, open source networking platform almost since the day it was unveiled? Earlier this week, Vyatta launched Version 6.0 of that OS, expanding the feature set to include Vyatta Remote Access API platform and a range of additional services offerings. The company has built an impressive channel on the premise that as an open source alternative, it can provide all the functionality of a Cisco OS for a fraction of the cost. The message seems to resonating in the venture capital community, too, from which Vyatta has seen consistent Series B and Series C funding rounds a number of times in the past few years.
Aerohive's low-cost wireless LAN products are getting hot just at the right time: wireless LANs have become necessities (as opposed to luxuries), solution providers with a focus on infrastructure have renewed their focus on developing true, dedicated wireless practice, the ratification of the 802.11n standard has expanded the opportunities that much more, and cloud and infrastructure-as-a-service opportunities mean a whole new world in wireless-oriented managed services. Aerohive -- a consistently mentioned IPO possibility for a few years now -- would seem to be buzzing right in the thick of those trends. It also has a retooled channel program on the way this spring, and Aerohive in mid-March secured a $23.5 million round of Series C equity funding.
A leader in application delivery controllers and beloved by VARs thanks to a 100 percent focus on channels and strong programs for those channels, A10's brand awareness is expanding. In January 2010, A10 unveiled its AX Series virtualization product roadmap, charting a course for enterprises and service providers to grow their virtual environments gradually using different appliance and chassis options. A10 once again ranked among the 5-Star Partner Programs in Everything Channel's 2010 Partner Program Guide.
The open source PBX Asterisk -- and the company's VoIP-in-a-box turnkey Switchvox -- have propelled Digium to rich successes and steady growth in the channel. Thanks to high profile partnerships with the likes of IBM, Polycom and Skype, Digium's profile is also increasing -- and at a good time, too, considering that more than 18 percent of PBXes in North America are open source, according to The Eastern Management Group. Digium supporters have been waiting anxiously on hints of an IPO for a few years now, but the company hasn't yet taken the plunge. How about it, Digium?
They're in the 5-Star Partner Programs Guide, and in the 100 Percent Club -- meaning that Exinda Networks sells only through the channel and has done a darn fine job of keeping its partners happy. Brand awareness has eluded the company so far, but Exinda CEO Michael Sharma recently told Channelweb.com that the company was finally starting to reach "critical mass" as it seizes opportunities in midmarket WAN optimization.
Broadband bonding is Mushroom's game, and as enterprises look for ways to do more with the infrastructure they have, the company's offerings -- which combine all of a local network's available Internet connection resources into a single, virtual broadband pipe to improve connectivity -- are in demand. While the company's had channel partners for a while now, it was only in November 2009 that it launched a formal program to improve its visibility among networking and infrastructure solution providers.
While it might seem strange to talk IPO about one of the most visible and long-established companies in the space, Avaya's top executives have made it no secret that they see Avaya -- which now controls all of Nortel's former enterprise assets -- as a public company again within a few years. Avaya was taken private in October 2007 by two private equity firms, TPG Capital and Silver Lake Partners, but thanks to the Nortel acquisition, may see its hoped-for return to the stock market sooner than previously thought.