Hyper-Converged Infrastructure Deal: Nutanix Closes $140M Funding Round

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Howard Ting, Nutanix
Howard Ting

Hyper-converged infrastructure technology developer Nutanix said Wednesday it closed a new round of funding it expects will more than carry it through to an IPO that could take place as soon as 2015.

The Series E round of funding, worth $140 million, brings total investment in Nutanix to about $312 million. It came from two public-market investors who have invested in the company for the long-term, said Howard Ting, senior vice president of marketing and product management at the San Jose, Calif.-based company.

Ting declined to name the investors. Reuters, however, citing an unnamed source, named them as Fidelity Investments and Wellington Management.

[Related: The Power Of One: New Converged Infrastructure Solutions]

The new investment gives Nutanix an implied valuation of about $2 billion, the company said.

Ting told CRN Nutanix closed the investment in record time.

"We went from term sheet to close in 13 days," he said, referring to the initial list of what investors want in terms of investment and valuation. "Our advisors said they never saw anything this fast before."

Ting said the new funding allows Nutanix to invest heavily in R&D and sales.

"There's just a lot of opportunity for us," he said. "This also allows us to go public on our time and in a way we choose. It allows us to go public in the way we want to."

The new funding is a sign that Nutanix is investing heavily in the future, said Jeff Guenthner, director for solutions architecture at CMI, a Mill Valley, Calif.-based solution provider and Nutanix partner.

Guenthner told CRN he is very comfortable with the way Nutanix is investing, and said the vendor is not burning through cash in the way many IT startups do.

"We're Nutanix's first partner, and talked to them when they were in stealth mode," he said. "I asked about their burn rate, and they said there was no problem. They already had their first product ready to go at the time, and still had plenty of cash on hand."

Guenthner said he expects a big part of the funding to be used to expand Nutanix's software engineering team.

"Nutanix's technology is software-focused and they need engineers," he said. "They are competing with Facebook and Google for employees and winning."

NEXT: "Insane" Business Growth, Growing Competition

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