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Nirvanix receives funding to seed cloud development

Cloud storage provider Nirvanix completed a $25 million Series C funding round today with plans to build out a new engineering center in Colorado, and move toward an IPO.

The round brings Nirvanix’s total funding to $70 million. CEO Scott Genereux said the company is expanding its “Cloud Competency Center” in Boulder under its new VP of cloud storage engineering Dave Barr, who previously led engineering for LeftHand Storage iSCSI SANs at Hewlett-Packard. Nirvanix is also keeping its San Diego engineering team.

“Over the next six to 12 months you can expect to see our engineering team deliver innovation aimed at addressing petabyte-scale clouds,” Genereux said. He said NIrvanix will also likely increase its data centers from eight to at least 10, with additions in Europe, Asia and perhaps South America.

Nirvanix is trying to establish itself as the leading enterprise cloud storage provider, with the help of an OEM deal with IBM Global Services signed last October. Nirvanix is managing a 9 PB digital repository cloud at USC, and Genereux said the provider will soon announce another customer with even more data in the cloud. He said Nirvanix has signed 30 customers already through IBM.

“Customers are frustrated with the same old story, buy a box, hope you have enough capacity and manage it the same way and do a tech refresh in three years,” he said. “It’s a circle that box vendors have formed for them.”

Genereux said Nirvanix competes more with the “box vendors” than with other cloud services. He said EMC is the most frequent competitor, but most of the data Nirvanix moves to the cloud is coming off NetApp storage. “EMC might be losing against us when we’re bidding, but NetApp is losing the footprint,” he said.

Genereax said he hopes Nirvanix can reach profitability without another funding round. “We’re marching towards an IPO,” he said. “Our business strategy is based on taking the company to the public markets over the next few years.”

Khosla Ventures led the funding round, with previous investors Valhalla Partners, Intel Capital, Mission Ventures and Windward Ventures participating. Khosla general partner David Weiden joins the Nirvanix board.

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