$250 Million in Series E Funding for Cohesity, Total at $660 Million

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This new financial round for Cohesity puts the company in a new trajectory even if we continue to wonder the rationale behind this new round.

It represents a huge indicator of trust for the leadership team, its product line and its strategy in an uncertain period. Sure the deal was settle before the crisis.

The company had already raised $410 million but the previous valuation was just above the unicorn threshold at $1.1 billion that doesn't prevent from an acquisition. And this number is too low for such player, VCs and founders.

The logic is to grow fast and independent, put a stellar valuation, protect for a few quarters the company then potentially do an IPO or wait for a good proposal. And dilution doesn't seem to be even a question. For a few editions, Coldago Research lists Cohesity in its bi-annual Storage Unicorn report.

Total of $660 million invested in Cohesity includes:

 * in $ million

$250 million is the highest financial round since the beginning of the year for a storage start-up. Top 3 in 2019 were Kaseya and Veeam with $500 million and Rubrik with $261 million. The table below, with data from Crunchbase, illustrates funding for private and public data and storage management companies and also other IT private vendors (in blue) with a minimum of $200 million. Another company will announce this week a $100 million VC round.

* in $million

Cohesity is among the few new players addressing secondary storage challenges with a new hyperconverged approach, at least they started with this mission.

As a SDS vendor, it offers a flexible product flavors, appliance or software: C4000 and C6000 groups compute, flash and HDDs. Dedicated initially to the data center then the cloud, the strategy was extended recently with a edge iteration. DataProtect and DataPlatform are the 2 members of the product line supporting AWS, GCP and Azure and vSphere, Hyper-V, AHV and Kubernetes operating environments. To extend its DataProtect application coverage, the company has acquired in 2019 the second NoSQL database backup player, Imanis Data, following Rubrik similar move with Datos IO done in 2018.

A recent end-users survey run by Coldago Research in January 2020 in US and Europe, shows users perceptions results for secondary storage and Cohesity is #4, Spectra Logic being #1, Dell EMC #2 and Quantum #3.

Data services features set is very rich, probably one of the most comprehensive of the market with file - NFS and SMB - and object - S3 of course - access methods, writable snapshots, clones, replication and erasure coding, de-dupe and compression, tiering to S3, encryption, quotas, IAM, DR automation, WORM, search, QoS and API access to list a few.

Each cluster is strictly consistent meaning that the topology is perfect for local or small stretched configurations. Beyond that, the start-up offers to connect clusters together and replicate data between them, wherever they run. With a shared nothing model coupling compute and storage on each node, Analytics Workbench provides the capability to run MapReduce jobs within the cluster confirming that the platform goes beyond storage. And finally users can manage multiple instances and sites with the SaaS tool Helios.

One of the key element of the solution is SpanFS, an internal file system designed to unify all nodes within a cluster. We name this an internal file system as it is not seen by clients connected to the cluster via standard protocols such NFS, SMB or S3. More recently the company has released Smartfiles to go beyond scale-out NAS and offer concurrent access to content via NAS and S3 access methods with many data services mentioned above.

Clearly the company has a strategy around four pillars: Protect, Storage, Serve and Compute.

But we detect a few things that seem to have difficulties to take-off, this is the case for the marketplace, still a question why Cohesity launched this. We notice only 11 services with 6 among these 11 from Cohesity. We also expect the adoption of NVMe-oF and some disaggregated model to decouple compute and storage needed for very large clusters with independent scalability requirements. Things like NFS over RDMA should be an interesting direction as well.

Key partners are HPE and Cisco and for HPE, collaboration means investment from HPE Pathfinder and presence in the Complete partner program.

Exposing NAS protocols and S3, the competition is dense in both segments but only a few vendors - Dell EMC, IBM with Red Hat, NetApp, Qumulo and VAST Data - have the capability to compete on both side. But the key point here is to offer only one product and no several products from the same vendors creating complexity thus increasing costs.

We anticipate a few directions for the company to enhance its four pillars and especially server and compute:

• address the primary storage need with a true AFNAS (All-Flash NAS),
• consolidate multiple use cases to become a true unstructured data platform for enterprise covering and converging primary and secondary needs and
• offer a multi-site namespace capability to bridge file storage islands and finally deliver a global file service, a grail quest for many vendors and users.

Read also:
Cohesity Increased by 100% Software Revenue in FY19
Received first software order over $10 million.
October 11, 2019 | Press Release
Cohesity Raises $250 Million, Highest Round Since 2015 Among Storage Start-Ups
Investors led by SoftBank, then Cisco and HPE [with our comments]
June 12, 2018 | Press Release
Investors Would Place at Least $150 Million Into Cohesity
Already getting $160 million in financial funding
April 16, 2018 | In Brief
Investors Would Place at Least $150 Million Into Cohesity
Already getting $160 million in financial funding
April 6, 2018 | In Brief
Top Fastest Growing Storage Companies in 2017
600% for Cohesity and then ...
by Jean Jacques Maleval | March 16, 2018
Exclusive Interview With Mohit Aron, CEO and Founder, Cohesity
In hyperconverged secondary storage platform
by Philippe Nicolas | May 3, 2017 | News
Cohesity Raises $90 Million, Total at $190 Million
Investors include Cisco and HPE.
April 4, 2017 | Press Release
Cohesity Emerged From Steath Mode
With $55 million series B round followed by $15 million series A in 2013
June 18, 2015 | Press Release
Storage Start-Up Out of Stealth Mode on June 17: Cohesity
In infinitely scalable storage solution
by Jean Jacques Maleval | June 12, 2015 | News
Do You Know Stealthy Storage Start-Up Cohesity?
CEO is founder and former CTO of Nutanix.
by Jean Jacques Maleval | September 25, 2014 | News