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SimpliVity says sales still surging

SimpliVity claims its second quarter sales bookings increased 250 percent over last year, fueled by its Cisco partnership and an avalanche of interest in hyper-convergence.

SimpliVity does not give as much information on its financials as rival Nutanix, but is widely believed to be No. 2 behind Nutanix in hyper-convergence market share. The two private companies were pioneers of hyper-convergence, which combines storage, servers, virtualization and networking in one box.

SimpliVity began selling its software and the ASIC than handled data deduplication along with Cisco UCS servers in early 2015. It also continues to sell its OmniCube bundled appliances.

SimpliVity CEO Doron Kempel said sales with Cisco increased four times from the first quarter to the second, although he said Cisco still accounts for less than 20 percent of SimpliVity sales. He said the company has more than 550 customers and 2,000 units in the field.

Kempel said besides the bump from Cisco, SimpliVity also benefitted last quarter from hype around hyper-convergence. That hype is also attracting more competition, though.

“The market is starting to mature. There is much more noise about hyper-convergence,” Kempel said. “Now large vendors are trying to convolute what it means. A lot of analysts are completely confused. They confuse hyper-convergence with convergence.”

Many vendors are pushing converged systems – packaging discrete servers, storage and hypervisors – but they are also getting into hyper-convergence. VMware is among them with its Virtual SAN (VSAN) software, which it makes available to hardware partners through its EVO: RAIL program. Dell, Hewlett-Packard, EMC and Hitachi Data Systems are among large storage vendors who sell EVO:RAIL systems. Dell also sells Nutanix software on its PowerEdge servers through an OEM deal.

Kempel said most of SimpliVity’s deals are still against legacy storage, with about 20 percent coming head-to-head against Nutanix.

He said SimpliVity rarely sees VMware or EVO: RAIL appliances in the field. “The customers we talk to expect hyper-convergence to run tier one applications across sites,” he said. “EVO:RAIL and Nutanix are focused on single sites and VDI.”

Kempel will be talking to a lot more customers personally. Despite the increase in sales, he said he has replaced Mitch Breen as senior vice president of global sales.

“After 19 months with us, he completed his mission and I have assumed the role of global head of sales,” Kempel said. “We are intensifying our go-to-market activities.”

SimpliVity also added Jose Almandoz as SVP of operations and Randi Nichols as VP of human resources to help manage growth that Kempel said amounts to 10 new employees per week. He said he plans to grow from its current 550 employees to around 800 employees.

SimpliVity closed a $175 million funding round in March.