The 10 Coolest Virtualization Startups Of 2015

Value In Virtualization

Server virtualization technology has saved companies untold millions of dollars by enabling them to get the most out of their hardware. Now, startups are delving into areas like storage and data virtualization, providing customers with similar benefits for streamlining and optimizing infrastructure performance.

In many cases, these startups are developing technology that fine-tunes the performance of cloud computing and enables it to deliver on its vast potential. While many startups would love to be the next VMware, they're cognizant that what they're developing can be just as revolutionary on a smaller scale.

Some of the names on this year's list of coolest startups are familiar, well-funded ones, while others are newcomers that have emerged on the scene and made a quick impact. All of these companies are on the radar of solution providers that sell virtualization into enterprise and midmarket customer accounts.

So, without any further ado, CRN here presents its picks for the 10 coolest virtualization startups of 2015.

If you missed it, be sure to take a look back at the rest of the best of 2015 with CRN.


CEO: Jedidiah Yueh

Delphix sells technology that shares a single copy of a database across multiple cloud-based instances by using virtualization, which speeds the process of setting up new databases. The 7-year-old startup landed a $75 million Series D round of funding in July led by Fidelity Management and Research Co., and has raised nearly $120 million overall.

Delphix claims to have many Fortune 500 firms as customers, and it also has partnerships with Amazon Web Services, VMware, Dell, SAP and other vendors. Its technology works with databases from Oracle, Microsoft, IBM, SAP and a range of other technologies.

The Menlo Park, Calif.-based startup said in July that it plans to use the funding to expand its sales and marketing functions around the world. Although data virtualization is still a small market, the interest Delphix has attracted from investors suggests that it's poised to see some serious growth in the coming years.

Primary Data

CEO: Lance Smith

Primary Data, a startup formed in 2013 by former executives from storage vendor Fusion-io (now part of Sandisk), is another up-and-coming player in the data virtualization space, having landed more than $60 million in funding so far.

The Los Altos, Calif.-based startup is probably best-known for having Apple co-founder Steve Wozniak on staff as chief scientist, but it's looking to make its technology synonymous with data center efficiency.

Primary Data's DataSphere offering virtualizes data through the use of metadata, with the goal of ensuring that apps always get the right amount of storage they need, thereby eliminating the need for over-provisioning storage. It's also designed to work with different flavors of data center infrastructure.

Co-founders David Flynn (chief technology officer) and Rick White (chief marketing officer), along with Lance Smith, president and CEO, led Fusion-io before its acquisition by Sandisk. Now, they're looking to continue pushing the envelope on a form of virtualization that is rapidly coming into vogue.


CEO: Jeff Hausman

CloudPhysics, a startup founded by former VMware storage engineers, has carved out a name for itself with a Software-as-a-Service offering that uses predictive analytics to ensure that virtualized infrastructure is running at peak efficiency. VMware co-founders Diane Greene (now with Google) and Mendel Rosenblum were early investors in the Mountain View, Calif.-based startup.

CloudPhysics recently unveiled a feature for VMware environments called Exploration Mode, which lets administrators pinpoint the cause of problems with their virtual server, storage and networking configurations at an early stage, before they can have a negative impact. The idea is to reduce human error by automating the process of detecting infrastructure problems, and it's one that's quickly catching on with organizations with large virtual environments.


CEO: Sirish Raghuram

Platform9, another startup with VMware DNA, sells a SaaS cloud management offering that turns an organization's servers into an OpenStack-based private cloud that supports Docker, KVM and VMware vSphere. The idea is to let firms of all sizes run the same type of ultra-efficient infrastructure in their data centers as what's available from Amazon Web Services and other public clouds.

The Sunnyvale, Calif.-based startup came out of stealth last summer and landed a $10 million Series B round in August of this year.

While VMware revolutionized the data center by letting organizations get more capacity from their servers, Platform9 is going a step further by making it easier for their customers to take advantage of cloud efficiencies. And since OpenStack isn't exactly a breeze to set up and maintain, Platform9 is handling the heavy lifting involved and making it as easy as possible for customers to get these benefits.


CEO: Ziv Kedem

Zerto, a 6-year-old startup focused on disaster recovery and business continuity technology for virtual and cloud environments, has several EMC storage veterans on its management team.

The startup -- which has headquarters in Israel and Boston -- sells exclusively through channel partners. It has more than 800 partners around the world, including resellers, systems integrators and managed cloud service providers, Director of Global Partner Marketing Mariah West told CRN in May.

The latest version of Zerto's flagship product, Virtual Replication 4.0, expands support to Microsoft Hyper-V and Amazon Web Services environments. Zerto has raised $60 million in five rounds, the latest a $26 million Series D last June, according to Crunchbase.

Sea Street Technologies

CEO: Harley Stowell

Sea Street Technologies, a Boston-based cloud orchestration and automation startup, is taking aim at a problem that many of its enterprise technology industry brethren are trying to address: making sure infrastructure meets the resource needs of mission-critical apps.

Founder and CEO Harley Stowell sold his last company -- network virtualization startup LineSider Technologies -- to Cisco Systems in 2010. Now, he's reunited with some of his former team, including Chief Technology Officer John Weber, to target the enterprise and service provider market with Sea Street Technologies.

The startup's flagship product, called StratOS, uses policies to automate apps and infrastructure. It also gathers telemetry data to fine-tune performance, which helps organizations save money and boost the efficiency of their compute, storage and networking environments.


CEO: Doron Kempel

It's getting difficult to describe SimpliVity -- a 6-year-old vendor that has raised more than $276 million to date -- as a startup, but its portfolio includes a data virtualization component that has attracted the interest of many solution providers.

SimpliVity's flagship OmniCube product is a hyper-converged infrastructure play that combines compute, storage, networking and virtualization on x86 server hardware. Its data virtualization technology deduplicates and compresses data on production storage systems and reduces the frequency of writes to and from disks.

SimpliVity inked a partnership with Lenovo earlier this year to go along with the one it already had with Cisco Systems. Now, the startup's channel partners are waiting for what's next. Whether SimpliVity gets acquired, or continues to build its business as a standalone company, remains to be seen, but there's no denying that this company's technology will be getting lots of attention in 2016.


CEO: Ariel Maislos

What do Intel Capital, Cisco and SanDisk have in common? They're all early strategic investors in Stratoscale, a hyper-converged startup that has raised around $40 million since its founding in 2013.

Stratoscale develops software that turns industry-standard x86 servers into hyper-converged appliances. Yes, Nutanix, SimpliVity and other startups are already well-established in this space, but Stratoscale is going right into VMware's wheelhouse by supporting Linux containers and virtualization.

Some industry watchers believe the Marlborough, Mass.-based startup could eventually become an acquisition target for Cisco or a host of other potential suitors. Stratoscale joined Cisco's Solution Partner program, which means its technology has been deemed compatible with the networking giant's Internet of Everything initiative.

Stratoscale launched a program in June that lets developers and customers test drive its technology. While Stratoscale is still relatively quiet, data center solution providers are expecting big things from the startup in 2016.


CEO: Ben Golub

San Francisco-based Docker is another example of a startup that has generated so much buzz that it's easy to forget it's still just a youngster in the IT industry. Docker has now raised around $180 million in five funding rounds, the latest an $18 million Series D in November.

Docker is the most-funded and best-known player in the Linux container space, but it's starting to see competition from the likes of CoreOS, a San Francisco-based startup that introduced a rival container standard called Rocket last year.

More recently, Docker has started acting like a big company by acquiring smaller ones. In October, it acquired Tutum, a tiny 11-person firm that develops technology for deploying and orchestrating Docker containers -- specifically the "last mile" of sending applications into production environments.


CEO: Dheeraj Pandey

The darling of the red-hot hyper-converged infrastructure market, Nutanix has raised more than $312 million in funding since its founding in 2009 and appears to be on track for an IPO at some point in the not-too-distant future. Nutanix inked an OEM deal with Lenovo that promises to broaden its reach.

Yet Nutanix isn't resting on its laurels: In June, the startup unveiled its own KVM-based server virtualization hypervisor, called Acropolis, along with a management platform called Prism. In doing so, Nutanix took aim at VMware, the virtualization kingpin that is now one of the startup's biggest rivals.

Nutanix probably could have done an IPO this year and done well, but the startup apparently has its sights set on much bigger things. For example, Nutanix has made noises recently about offering its technology in software-only form, which could open the door to service providers and other large customers.

Many solution providers believe that if Nutanix can ride the recent groundswell of market interest in KVM, it could become an even bigger thorn in VMware's side and establish itself as a bone fide data center force to be reckoned with.