Vyatta receives $11M in funding, led by Comcast

Open source router startup Vyatta received an $11 million cash infusion this week, led by Comcast's venture funding arm.

Industry observers say the investment in Vyatta by Comcast Interactive Capital (CIC) is an interesting move because it establishes a relationship between an up-and-coming Cisco rival and an enormous Cisco customer. JPMorgan Partners, ComVentures and ArrowPath Venture Partners also participated in the latest funding round for Vyatta, which has garnered $18.5 million in total funding.

“Service providers are constantly on the lookout for solutions that can generate new revenue streams,” said Deepak Sindwani, a CIC principal, in a statement. "Vyatta enables several new potential managed service bundles for small and medium-sized business and enterprise markets." He praised Vyatta's open source technology and reliance on industry-standard x86 hardware over proprietary network systems.

CIC invests in other technology companies that compete with Cisco, as well as in firms where Cisco also has a stake. Common CIC-Cisco investments include security vendor Arbor Networks; semiconductor maker Entropic Communications and security information-management company netForensics; as well as Arroyo Video Solutions, which Cisco bought for $92 million in 2006.

Vyatta has marketed itself aggressively as a low-cost, open source alternative to Cisco and Juniper Networks in the WAN-access router market. Founded in 2004, Vyatta makes the Open Flexible Router, a software-based router, firewall and VPN product built on open source technology, such as Linux, Extensible Open Router Project, and Free Secure WAN. Vyatta offers the product as a free download, with various annual support services available. The company also offers the product as an appliance, with the code preinstalled on Dell servers and WAN connectivity gear from Sangoma.