Well-funded flash array startup Violin Memory has filed papers to go public in hopes of raising $172.5 million by selling shares on the New York Stock Exchange.
Violin’s initial public offering (IPO) is expected in late September. The move has been expected – Violin executives have talked about going public for more than a year and the vendor is the early market leader in the fast-growing flash storage array market.
According to Voilin’s S-1 filing, the company had revenues of $11.4 million in 2010, $53.9 million in 2011 and $73.8 million in 2012 (the fiscal year ended Jan. 31, 2013), and it reported $51.3 million in the six months that ended July 31, 2013. Violin has yet to come close to a profit, though, with a loss of $109.1 million last year and $59.2 million over the last six months.
Violin’s revenue growth has not been a straight trajectory. Early sales were helped by a reseller deal with Hewlett-Packard (HP), which accounted for 65% of Violin’s revenue during 2011. When HP ended that deal in 2012, Violin’s revenue dropped from $21.9 million for the quarter that ended Jan. 31, 2012 to $10.2 million the following quarter. HP accounted for 37% of Violin sales last year. HP now sells its own storage arrays in all-flash configurations and has not qualified Violin’s flagship 6000 Series Flash Memory Arrays. The decline from HP sales likely caused Violin to delay its IPO filing.
Violin began selling its first all-flash array — the 3000 Series – in 2010 and followed with the 6000 Series in 2011. In March, Violin announced its Velocity PCIe flash cards to move into server-side flash.
According to research firm Gartner, Violin held an industry-high 19.4% of the flash array market in 2012, with storage giants EMC, NetApp, IBM and Hitachi Data Systems trailing. Those larger companies have all launched all-flash arrays in the past year, so Violin’s challenge as a public company will be to convince customers it can do flash better than the storage stalwarts.
Violin did not disclose the amount of its total venture and strategic funding, but it has raised at least $268 million since 2010 when current CEO Don Basile came to Violin from Fusion-io. According to Violin’s S-1 filing, its NAND supplier Toshiba owns more than 14% of the company.