Sources: Software-Defined Networking Startup Netsocket May Be Shutting Down

Netsocket, a software-defined networking startup that has been trying to take a bite out of Cisco Systems' share of the edge network market, appears to be preparing to either sell off its assets or shut down, sources familiar with the matter told CRN on Monday.

Netsocket sells an SDN and network function virtualization product called Virtual Edge for managed service providers that sell to enterprises and small and midsize businesses.

Virtual Edge is designed to replace the traditional router, switch and server hardware setup at the network edge with a combination of NFV software running on a purpose-built commodity x86 server and eight-port Layer 2 Gigabit Ethernet switch.

[Related: CRN's Review Of Netsocket Virtual Edge]

Netsocket, Plano, Texas, laid off about half of its staff of 20-some employees in August as part of a cost-cutting measure, according to the sources. Included in the layoffs were Tricia Hosek, COO and vice president of products and marketing, and Dave Corley, director of product management.

Netsocket, founded in 2006, has raised $21.7 million in four funding rounds, the most recent a $4.7 million investment last September from Aristos Ventures. Other investors include Venture Investors, Sevin Rosen Funds, Silver Creek Ventures and Trailblazer Capital.

Netsocket executives didn't respond to multiple calls and emails on Friday and Monday requesting comment on its current status. Attempts to contact Netsocket's investors were also unsuccessful.

Calls to Netsocket's main phone number are currently being handled by an automated voice system, and no one was answering the phone in the vendor's customer service, sales and marketing departments on Friday or Monday.

Netsocket was founded by former executives from Chiaro Networks, a vendor that spent eight years challenging Cisco in the telecom service provider market before shutting down in 2005.

Chiaro Networks developed Enstara, a high-capacity core router for telecom service providers, and Netsocket uses some of the code from it in its product, Light Reading reported last July.

Ken Lewis, former CEO of Chiaro Networks, is Netsocket's vice president of operations. Richard Platt, Netsocket CTO and vice president of engineering, is a former Cisco executive who spent nearly 9 years at the company.

Fletcher Hamilton, Netsocket's president and CEO, has previously held executive roles at Alcatel and Acme Packet.

Netsocket does most of its business through the channel and has a program with resources for partners to sell, install, manage and maintain Virtual Edge. The vendor also partners with third-party software vendors, including Microsoft and Fortinet, to deliver apps to customers through the Virtual Edge offering.

PUBLISHED NOV. 10, 2014