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Pivot3 vSTAC sales soaring, CEO says

Hyper-converged vendor Pivot3 said it more than tripled its revenue in the fourth quarter of 2016 from the previous year, and grew total revenue 84% in 2016 from 2015.

Pivot3’s growth came in part from two new products launched last year. It added the Pivot3 Edge Office for SMBs and the Pivot3 vSTAC SLX incorporating PCI Express flash technology acquired from NexGen Storage in January 2015. Pivot3 is also incrementally integrating quality of service acquired from NexGen into the Pivot3 vSTAC OS, and CEO Ron Nash said new products adding both QoS and flash will ship in 2017.

Quality of service may hold the key to the vendor’s future success. Pivot3’s Dynamic QoS includes a policy engine that prioritizes workloads and manages data placement and protection. Nash said coming Pivot3 vSTAC products will extend QoS to the cloud and legacy storage. The vendor will add another NexGen storage flash system in 2017.

“Instead of just having our policy engine work on hyper-converged infrastructure, we’re extending it out to the cloud and backward to legacy systems,” Nash said.

He said the engine will be able to look at characteristics, such as service-level agreements and required response times, and find the best storage tier for application data. For instance, if you’re looking for cheap storage and don’t need fast response times, the data can go to a cold storage public cloud service.

Nash said the Pivot3 vSTAC SLX system, integrating NexGen technology, launched in 2016 and appealed to enterprises because of the flash performance. “It kind of surprised us where it was sold,” he said. “We thought it might in the midrange, but we found high-end people are using it, too. If you have an application that needs low latency, it gives you the low latency an NVMe-PCI-type storage device gives.”

‘Little guy” moving up to compete with ‘the big boys’

Nash said Pivot3’s long-term goal is to follow Nutanix’s 2016 initial public offering with an IPO of its own to become a public company. He said Pivot3 takes a different approach than Nutanix, though. He is trying to avoid the heavy losses Nutanix has suffered, even as it racks up impressive revenue growth.

“We’re much more disciplined about financial performance,” he said. “We want to grow fast, but if the difference between 80% and 150% growth is [that] I have a massive loss at 150%, I’ll stick to 80%. We’re still losing money, but not hemorrhaging.”

He said Pivot3’s $55 million funding round in March 2015 should get the company to profitability, although it may raise another round ahead of an IPO.

For now, Pivot3 is the little guy in the land of hyper-convergence giants. Its competitors are newly public Nutanix, Dell EMC (including VMware), Hewlett Packard Enterprise (with its new SimpliVity acquisition) and Cisco.

“A year ago, I was competing with startup companies; now I’m competing with big companies. I count Nutanix as a big company now,” he said. “The big boys are moving in. But I think we can compete against them.”

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