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Kaminario Scores $53M To Take On Flash Storage Market

Tuesday, December 2, 2014

Kaminario, a company based in Newton, Mass., landed $53 million in funding today as it continues its battle in the growing flash storage array market. The latest influx brings the total raised to an impressive $128 million, making the storage startup the best funded company you probably never heard of.

The round includes current investors Sequoia Capital, Pitango, Globespan, Tenaya and Mitsui, and new investors, Silicon Valley Bank and Lazarus Hedge Fund, as well as a mysterious, unnamed large public company.

You’ve probably heard of Pure Storage in this market and you may be wondering why you haven’t heard of these guys. In fact, they both have a similar story and they both claim to give you flash storage at a mechanical disk price, and I suspect they both do in different ways.

Dani Golan, the company founder and CEO says one of the reasons you might not have of heard of them is they haven’t been plowing a lot of money into marketing until now, preferring to put the funds into product development, but he says they are deployed in hundreds of customers (although he won’t share a hard number) and the company is ready to get the word out.

As a means of introduction he says, “We provide an all-flash solution at a lower cost than what we call hybrids –a bit of flash, a bit of hard drive and a bit of cloud.” He says they compete well in these markets because they come in at a lower price, but he says the real differentiator is the company’s ability to scale up and scale out.

Scaling up means you add storage capacity, while scaling out means you add compute capacity to run the storage array. He claims his company is the only all-flash solution that does both.

The fact is that venture capital is a funny game. The players see what’s hot and they know what will sell and who can resist affordable flash storage. It’s faster than conventional storage and if you can have it for the same price as a mechanical disk, you would be foolish not to buy it, all things being equal. And let’s face it, everyone needs more storage.

Funders know a good thing when they see it, too, and they each place their bets on a different player who does something similar. The companies will explain how they are different, and it’s a big market and the logic says, if you give some smart people who understand storage some money, they will put together a cool solution, and the market will work itself out as it always does.

Every market will have winners and losers of course, and some of these companies with a similar pedigree will be successful, and some could end up getting sold to one of the established vendors who are late to the flash game, taking an irritant off the market and giving them a viable market all at the same time.

Regardless, Golan says Kaminario is in this market to compete and he believes he has the product to get it done. Time will tell if he’s right, but he’s got a bushel of cash to give it his best shot.