Apptio To Acquire Cloudability, Creating FinOps Powerhouse

Apptio revealed Thursday it had reached a deal to acquire Cloudability, a FinOps pioneer and longtime Apptio partner.

Both companies focus on IT cost assessment and optimization, but Apptio's strengths lie in the data center while Cloudability has specialized in managing spend on public clouds, said Apptio co-founder and CEO Sunny Gupta.

Once the deal closes in the coming weeks at an undisclosed sum, they will merge their platforms to offer a comprehensive data-center to public cloud cost-optimization solution, he said.

[Related: FinOps Foundation: New Trade Group Shares Cloud Cost-Optimization Best Practices]

Apptio, based in Bellevue, Wash., went private earlier this year in a $1.94 billion buyout from Vista Equity Partners. The company has roughly 700 customers, including some of the world's largest enterprises, who rely on its technology to assess total cost of ownership on their IT investments, from servers, to cloud, to applications, to labor.

Apptio was very familiar with Cloudability, having partnered with the startup soon after its founding in Portland, Oregon in 2011, Gupta said.

While it was working to remove itself from the public market, Apptio's leaders saw Cloudability was in the process of raising capital, sparking the idea of an acquisition.

"We thought it was a great vision," Gupta said. "We could offer breadth and depth across cloud and hybrid environments in a single integrated platform."

Cloudability's machine learning-powered technology does have some overlap with Apptio's Cloud Business Management platform, he said.

But Cloudability has developed unique depth in optimization and reserved instance planning for Amazon, Microsoft and Google clouds, allowing for a unique best-of-breed solution.

Mat Ellis, Cloudability founder and CEO, told CRN most FinOps companies typically either focus on data center or public cloud.

"There's nothing on the market that takes you from one to another. It’s a hodgepodge of things," Ellis said.

Apptio and Cloudability can build the first combined solution that starts at the data center and takes customers out to the public cloud, he said.

That solution will not be "distracted" with added features for security and IT automation that "don't do much," Ellis told CRN. Instead, it will stick to the core function of an "operating model for your IT."

Cloudability's brand will remain, as will all its employees and its headquarters in Portland.

Cloudability is Apptio's third and largest acquisition in the past year and a half, preceded by FittedCloud in October and Digital Fuel in February of 2018.