Cisco, Intel Invest In Hyper-Converged Infrastructure Player Stratoscale

Hyper-converged infrastructure software developer Stratoscale has come out of stealth mode with a huge funding round led by three IT heavyweight strategic investors.

Stratoscale Tuesday unveiled a $32 million round of funding led by Intel Capital, with Cisco and SanDisk joining in as strategic investors, said Ariel Maislos, co-founder and CEO of the Herzeliya, Israel-based software developer.

The round brings total funding to slightly more than $42 million, Maislos told CRN.

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The funding is targeting the development and bringing to market of Stratoscale's hyper-converged infrastructure software stack which, when combined with industry-standard servers, will allow the company and its partners to offer solutions in the same market as such vendors as Nutanix, SimpliVity and VMware, he said.

"We don't build boxes, so we don't compete directly with them," he said. "But there is a market of customers who have preferred hardware vendors. For the first time, we are providing a plug-and-play software stack that allows customers to run everything on the same physical infrastructure. And we mean everything."

That "everything" includes resilient storage along with Stratoscale's own management plane with resource management and schedulers built into the architecture, Maislos said.

"We don't have the limitation that comes from having to patch other software into our technology," he said. "And we scale to thousands of nodes."

Stratoscale's software works on any x86-based server that meets a minimum configuration, he said.

Maislos declined to talk about whether the company's strategic investors might use the Stratoscale hyper-converged software stack. "I can't comment," he said. "But you can make your own conclusions. For now, we're just talking about the investment."

Mike Davis, vice president of technology at Broadleaf Services, a Billerica, Mass.-based solution provider, drew his own scenario. While Cisco is already going to market by reselling SimpliVity's hyper-converged infrastructure software stack on its UCS servers, there's nothing stopping it from trying other solutions including Stratoscale, Davis said.

"Cisco tells us it takes about a year to integrate new technology," Davis told CRN. "If Cisco decides to acquire Stratoscale, it will have had the time to understand the company."

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Having investors such as Cisco and Intel could force Stratoscale to operate at a higher maturity level than otherwise possible, Davis said. "That could either accelerate Stratoscale's growth, or retard it," he said. "But it will make it more of an acquisition target. Intel and Cisco will be mentoring and influencing it."

Cisco is not against having competitive technologies in its portfolio, Davis said.

"Look at Cisco's acquisition of Meraki, which brought it networking as a service, with firewalls, switches and access points all centrally managed," he said. "It's a much simpler platform to work with compared to many others, including Cisco's."

Stratoscale's software, in beta now with general availability scheduled for early next year, will be sold to both hardware OEMs and through channels to customers.

PUBLISHED NOV. 4, 2014