Google In Talks To Acquire Container Startup D2iQ: Report

Google reportedly has its sights set on container tech startup D2iQ.

The Mountain View, Calif.-based tech giant is in talks to acquire D2iQ, according to a report by Axios that cited an unnamed source “close to the situation.”

D2iQ, a Google Cloud Platform and G Suite partner, declined comment, while Google did not immediately respond to CRN’s inquiry.

The deal value could exceed the $250 million that the San Francisco-based D2iQ has raised in successive venture capital funding rounds, but likely wouldn’t be as high as the $775 million valuation placed on D2iQ when it earned its $125 million series D funding round in 2018 to accelerate its hybrid cloud transformation, according to Axios.

D2iQ, an enterprise-grade cloud platform provider formerly known as Mesosphere until it pivoted to focus on Kubernetes last year, recently reportedly laid off 34 employees, or 13 percent of its workforce, to reduce costs to deal with a projected 40 percent sales decline, according to a Business Insider report that cited a leaked D2iQ internal presentation. The layoff came two weeks after CEO Mike Fey announced in mid-March that he was stepping down, Business Insider reported.

Google originally designed Kubernetes, the open-source, container-orchestration system for automating application deployment, scaling and management. The Cloud Native Computing Foundation now maintains it.

Google closed its $2.6 billion acquisition of Looker Data Sciences in February.

“We’ve been thoughtful on how we do acquisitions,” Google Cloud CEO Thomas Kurian told CRN in March. “We’ve always acquired complementary products. Looker, for example, has had many common customers with our analytics portfolio. We’ve shown that we don’t need acquisitions to grow. We can grow organically, and we’re growing very quickly organically. But where it makes sense, we’ve done acquisitions to complement our existing portfolio products.”

D2iQ investors include Andreessen Horowitz, Hewlett Packard Enterprise, Khosla Ventures, Koch Disruptive Technologies, Microsoft and T. Rowe Price Associates.

In April, D2iQ said it had been awarded a U.S. Department of Defense Enterprise Software Initiatives contract for its DevSecOps solutions and services.

CRN reported in December that D2IQ was ramping up its channel engagement with its first partner program and was looking to recruit DevOps-focused solution providers with a 'landing pad' for cloud-native modernization projects.