Panzura Closes New $32M Funding Round, Looks To Expand Its Cloud Storage Gateway Tech

Hybrid cloud storage technology developer Panzura this week unveiled a $32 million funding round that it hopes to use to expand sales efforts and drive new solution development.

That new round of funding follows a $75 million funding round unveiled Monday by all-flash storage vendor Kaminario, making this the second big storage funding round in less that two weeks into the new year.

The latest round brings total funding in Panzura to just over $90 million, said Patrick Harr, CEO of the Campbell, Calif.-based vendor.

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Panzura counts two strategic investors in its list of investors. One is Irvine, Calif.-based hard drive and SSD manufacturer Western Digital, while the has not yet been named.

Panzura's technology acts as a gateway to public cloud storage, and the company has good relationships with the primary public cloud vendors including Amazon Web Services, Azure, Google Cloud, and IBM Cloud, Harr told CRN.

"Today, we're driving over 2.5 petabytes of new storage to those public clouds," he said. "Some capacity is also being driven to private clouds. But it's primarily going to public clouds. We present a significant opportunity to partners to help drive their growth. I look at the on-premises storage model, and I predict it's dying."

The Panzura technology collapses on-premises NAS, WAN, de-dupe, backups, and archiving into a single offering with the cloud on the back-end, Harr said. The company's technology can be purchased as a complete appliance or a virtual appliance.

That appliance is key to the solution, Harr said. Data is stored on the appliance for high-performance writes and reads, and also stored on the cloud for backup and disaster recovery purposes, which overcomes one of the two primary barriers to adopting cloud storage, he said.

The other barrier, security, is handled by Panzura with its FIPS-certified solution that includes military-level encryption, Harr said. "The Department of Justice is a customer, but it does use its own private cloud," he said.

Seeing a vendor partner get a good round of funding is important for channel partners and their customers, said Stan Wysocki, vice president at Mark III Systems, a Houston-based solution provider and Panzura channel partner.

"When customers are making million-dollar-plus storage decisions, they want to know the vendor will grow, will support its solutions, and will not go away like other startups," Wysocki told CRN. "Panzura already has great products. The funding helps customers make the decision to buy, which helps us as well."

Mike Wilson, director of engineering at Datatility, an Ashburn, Va.-based MSP which built its own cloud using IBM's Cleversafe Object Storage, with Panzura as the gateway, said the investment will help the vendor expand its channels.

"It should help provide the dollars to meet customer demand as cloud storage matures and customers continue to embrace object storage," Wilson told CRN.

As a partner, Panzura has been fantastic, Wilson said. "We have a 100-percent close rate on proofs-of-concept to date with Panzura," he said. "Once customers get their hands on the products, they like it. And Panzura's sales reps and sales engineers are very competent."

Panzura is not yet a profitable company, but is close, Harr said. Instead, the company is still investing for growth. "We expect this new money to take us to profitability," he said. "But there could be an opportunity to take additional money for future expansion."

Harr said Panzura's primary competition is the status quo, which is how he termed the traditional on-premises storage model.

"We are in the cloud-first model," he said. "Our competitors are holding on to on-premises infrastructures, because any data going to the cloud is not on their infrastructures. Once data moves off-premises, they lose control of the customer."

Panzura also competes heavily with Natick, Mass.-based cloud storage gateway vendor Nasuni, Harr said.