Aerohive Networks: Fat Chance We'll Get Acquired

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With networking pure-plays Aruba Networks, Ruckus Wireless and Meru Networks being swallowed up by larger companies like Hewlett Packard Enterprise, one of the last standalone vendors in the market, Aerohive Networks, is striving to remain independent.

"If you look at the way technology marketplaces evolve, there are some patterns around consolidation, but the innovation comes from the standalone guys -- it's not coming [from] the behemoths," said David Greene, chief marketing officer at Aerohive, in an interview with CRN. "We want to leverage our independent status as a platform to driving innovation and driving growth and helping to point out some of the ways the industry can evolve going forward."

As bandwidth needs increase at a blistering pace and the Internet of Things market begins to blossom, vendors have scooped up networking companies at a blistering pace.

[Related: Aerohive Attracting Brocade-Ruckus Channel Partners Amid Broadcom Uncertainty]

Within the past 20 months, HPE bought Aruba for $3 billion, Fortinet acquired Meru for $44 million and Brocade Communications nabbed Ruckus for $1.2 billion. Brocade itself is being acquired by an even larger company, Broadcom, for $5.9 billion. Broadcom plans to divest Brocade's networking business, leaving only a handful of recognizable players in the market.  

Greene said that although there has been plenty of speculation this year about potential buyers for Milpitas, Calif.-based Aerohive, the company is looking to stay an independent innovator, providing differentiation for the channel.

"Our intent is to remain independent," said Greene. "We are the fastest growing Wi-Fi vendor this year. We were the fastest growing Wi-Fi vendor in our space."

"So we continue to see momentum towards us driven largely by our partners who say, 'Hey, there's something different here. There's a different way of thinking here, a different opportunity to engage with the vendor and there's a different way of thinking about the solution that I'm going to get [compared to] if I go buy a big Cisco or HP solution,'" said Greene. "We think that's a very nice premise for growth and our board of directors and investors view that as well."

One CEO from a solution provider that partners with Aerohive said he hopes the vendor will stay independent, but isn't optimistic that will be the case.

"It seems that everything is up for grabs at this point … anyone can be bought in today's market," said the CEO, who did not want to be identified. "I like Aerohive and want what [Greene] is saying to be true, but they're a small fish swimming among some real big fish out there."

The solution provider said his company's Aerohive sales increased 15 percent annually in 2016, mostly in the education and retail spaces.

"They have a niche. They have a few verticals they're known in. They have a good channel sales strategy … those are attributes that some companies might find interesting," he said.

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