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7 hot storage startups to watch

Storage newcomers specializing in flash, virtualization and cloud computing

By Brad Reed, Network World
November 22, 2011 09:11 AM ET

Network World - As the sheer amount of content on the Web has continued to increase exponentially, so too have the storage needs of large enterprises.

Remember when terabytes seemed big? Well with the sheer amount of content being generated today enterprises are now starting to think in terms of petabytes. And the trouble has been that all this data is not only expensive to store but it's getting more difficult to retrieve it from storage to servers on a timely basis. Thus, companies have been investing in technologies such as virtualization and cloud storage that can help them simplify their overall IT architecture, lower their costs and run their storage operations more efficiently. Deni Connor, the founding analyst at Storage Strategies Now, says that adapting to these trends is the goal of most cutting-edge storage companies on the market.

"We see a lot of companies coming out with solid-state appliances that put data into a cache and migrate that data from the cache when it's accessed less often," she says. "And everyone out there is virtualizing their servers and they're having problems getting at their data and knowing where that data is in a virtual environment."

STORAGE STARTUPS: View a slideshow of products from these startups

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John Mascarenas, the investment director for Intel Capital, says companies that want to store data on a multi-petabyte scale will need to look toward cloud-based solutions to meet their needs since they're facing limits in what traditional physical storage can provide.

"There's not enough physical capacity for the amount of data that's being generated," he says. "It continues to move past the place where we can keep building physical storage."

The result of this, says Mascarenas, has been a large amount of innovation in a space that has not previously been thought of as a cutting-edge industry. According to analysis from Strategic Advisory Services International LLC, venture funding for storage companies totaled $458 million through the first three quarters of 2011, or roughly 42.4% more than the $321.5 million in venture funding the storage industry received in the first three quarters of 2010 and more than double the $213.7 million in venture funding storage startups received through the first three quarters of 2009. What's more, storage mergers and acquisitions have strengthened over the past two years, growing from 21 deals worth $3.3 billion in 2009 to 34 deals valued at $9.1 billion in 2010 to 23 deals adding up to $8.7 billion through the first three quarters of 2011. [For more on mergers, see our "Top tech M&A deals of 2011" slideshow]

With all this in mind, here are seven storage companies worth watching by IT organizations looking to get a better handle on their storage needs.

Amplidata

Founded: 2009 
Focus: Storage for large unstructured data 
Location: Belgium

Who's the boss: CEO and co-founder Wim De Wispelaere specialized in deduplication and disk backup technologies while working as a director of product management at Symantec. COO and co-founder Wouter Van Eetvelde is also a Symantec veteran who helped build the company's PureDisk, Dedigate and DataCenter technologies.

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