Symform, developer of technology to build a distributed storage cloud that backs up one user's data across multiple users' storage devices, has closed a new $8 million round of investment, and it is looking for a strategic investor to invest an additional $3 million in the company.
Symform said this week its Series B round of financing included $8 million from multiple investment firms. Together with the $3 million it expects to come from an as-yet unnamed strategic investor, the company has already received investments totaling $20 million.
Symform has found its business has grown quickly since its 2009 emergence from stealth mode, said Matthew Schiltz, CEO of the Seattle-based vendor.
"We feel the market for cloud storage and backup is a very large market, and it's growing very quickly," Schiltz said. "Electronically-stored data is one of the fastest-growing businesses in the world. The company is growing very well. We've been growing the number of devices on our networks by 50 percent every quarter. We think we can accelerate that significantly."
Symform's Resilient Storage Architecture provides cloud storage by breaking up the data of one customer and spreading it across storage capacity contributed by other customers in such a way that it is not only encrypted but also safeguarded in that it gives someone who accesses that data only a tiny part of it.
The company's technology takes a copy of a customer's backup online, breaks the data up into 64-MB blocks, encrypts those blocks with AES-256 encryption technology, and then fragments those blocks into 1-MB fragments. To those 64 1-MB fragments are added another 32 1-MB parity fragments for redundancy. Those 96 fragments are then scattered across storage nodes around the world.
Those cloud storage nodes are simply space on one or more hard drives contributed by each customer via the Internet. The amount each customer contributes depends on how much cloud storage capacity the customer wishes to access.
Because each customer contributes raw storage capacity to the storage cloud, Symform offers a flat price of $50 per server per month with no limit on usage.
Symform is in the process of looking for a potential strategic partner who will invest the final $3 million included in the Series B round, Schiltz said. "We could have closed the entire $11 million," he said. "We just prefer to have a strategic investor. We would like it to be a company that could expand our network."
NEXT: Majority Channel Business
Symform has yet to enjoy a positive cash flow, Schiltz said. "Right now our focus is on investment and in growing the market," he said. "We don't anticipate being cash flow positive until our next series of investments, expected in 2014."
The majority of Symform's business comes from the approximately 500 MSPs who have already signed on as partners, Schiltz said. Those MSPs offer the Symform storage cloud either as part of a package of services or as a stand-alone service, he said.