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10 hot storage companies to watch

Mar 28, 201820 mins
Data Center

Offerings from these young storage companies include the likes of hybrid-cloud storage, tiered caching, zero data loss after recovery and even distributed storage on free disk space.

data storage watch
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Innovations such as software-defined storage (SDS), hyper-converged infrastructures (HCI), and blockchain have investors flocking to enterprise storage startups, and this market shows no signs of slowing down.

Collectively, the 10 startups featured in this roundup have raised more than $736 million in VC funding. This total is even more impressive when you factor in two startups not included in that calculation. One of them is entirely self-funded, while the other has a unique business model and an equally unique source of non-VC funding: an ICO, or Initial Coin Offering.

According to research firm IDC, the worldwide enterprise storage market expanded by 13.7 percent year over year to just under $13.6 billion in the fourth quarter of 2017. Other research firms believe the growth rate will accelerate in the near term. Research and Markets, for instance, predicts that one fast-growing segment of the overall enterprise storage market, cloud storage, will expand to become a $92.5 billion market by 2022.

The startups in this roundup are positioning themselves to ride that growth wave, offering everything from hybrid cloud storage with smart-tiered caching to platforms intended to deliver 100 percent uptime with zero data loss after a recovery event to a system designed in a way that could enable it to become the Airbnb of distributed storage.

ClearSky Data

What they do: Hybrid cloud storage.

Year founded: 2014

Funding: $39M

Headquarters: Boston, MA

CEO: Ellen Rubin. She was formerly a co-founder of CloudSwitch, a cloud enablement software company that was acquired by Verizon. 

Problem they solve: The complexity, cost, and management requirements of using secondary data centers for storage, disaster recovery (DR), and backup are a problem for resource-constrained IT organizations. From provisioning equipment to replicating data, this model leaves enterprises with too much overhead and too much sprawl to manage effectively.

The cloud offers an alternative – with the chance for consolidation, continuity and cost savings – but it’s challenging for IT to unwind existing data-center footprints and move to hybrid cloud environments without rewriting apps, making numerous copies or losing data.

Yet, this opportunity is a massive one. According to MarketsandMarkets, cloud storage is a fast-growing market that is expected to be worth $61 billion by 2022 – a 177 percent increase over 2017.

How they solve it: ClearSky Data provides on-demand primary storage with built-in offsite backup and DR as a single service. This hybrid cloud service features consumption-based pricing, so customers only pay for what they use. Businesses can also consolidate what used to be separate licenses, infrastructure and management for backup, DR and replication into one service.

ClearSky says that its Smart-Tiered Caching “optimizes data across the entire lifecycle where hot data is cached at the edge of applications, warm data is cached in a PoP” located within 120 miles of an end user’s primary data center and “all data, including cold/archived data, is stored in multiple locations in the public or a private cloud and is accessible on demand.”

Competitors include: Actifio, Dell EMC, NetApp, Nimble, Pure Storage, Veeam.

Customers include: Partners Healthcare, Highland Capital Partners, Federal Hill Solutions, Miles & Stockbridge, Barrister Digital, The Broad Institute, Special Olympics, the Diocese of Trenton.

Why they’re a hot startup to watch: With $39M in VC funding and a target market worth $25B and growing, ClearSky is well-positioned to grab a significant slice of the cloud storage market. The startup’s senior leadership played key roles in the sale of startups to Verizon and Dell, and a long list of named customers indicates that ClearSky already has a beachhead in this sector.


What they do: Hybrid cloud software and storage.

Year founded: 2013

Funding: $15.7

Headquarters: Reston, VA

CEO: Naj Husain, who was previously a co-founder and CEO of AppAssure Software, which was acquired by Dell.

Problem they solve: Many organizations have been blocked from moving to the cloud due to security, data control and compliance issues. Even so, most analysts and industry pundits believe that cloud adoption will spike in the near-term. Gartner, for instance, predicts that 90 percent of organizations will adopt hybrid infrastructure management capabilities by 2020.

How they solve it: The Cloudistics platform is designed for organizations seeking the ease of use, cost benefits and flexibility of the cloud, yet must also keep sensitive data behind their own firewalls. With Cloudistics, organizations are able to scale compute, network, and storage independently and as their workloads dictate.

Cloudistics provides a virtualization platform that is delivered on an appliance that resides behind your firewall, but which is controlled from the cloud. The Cloudistics platform collapses separate compute and storage silos into a virtualized platform that can be centrally managed. Through Cloudistics’ SaaS portal end users are able to create application-specific hardware profiles to drive the best performance based on each app’s requirements.

Users can create their own templates or rely on pre-configured virtual-server and application templates for point-and-click deployments, which eliminates the need for highly specialized resources and/or public cloud architects.

Competitors include: AWS, Microsoft Azure, VMware, RedHat, OpenStack.

Customers include: Howard Hughes Medical Institute, Integreon, Atlanta Hawks, MicroStrategy, Royal Bank of Canada.

Why they’re a hot startup to watch: Cloudistics may seem to fit better under the cloud than the storage category, but the boundaries between those two spaces is rather porous, and the startup was recommended by both a customer and partner.

Moreover, with on-the-record banking and medical customers, as well as flashy ones like the Atlanta Hawks, Cloudistics is proving its hybrid cloud platform can win against incumbents. Finally, Cloudistics’ leadership team has a track record of success, having led AppAssure to an acquisition by Dell and Librato to an acquisition by Solarwinds.


What they do: Hyper-converged secondary storage.

Year founded: 2013

Funding: $160M

Headquarters: San Jose, CA

CEO: Mohit Aron, who previously co-founded and served as CTO for Nutanix.

Problem they solve: As both the volume and variety of enterprise data grow exponentially, enterprises struggle to keep up. Until recently, enterprise IT handled different use cases with separate storage solutions, each built with its own proprietary hardware, user interface and licensing model. Unfortunately, this approach led to fragmented data siloes that have become operationally inefficient and too complex to effectively manage. 

Then, to move data to the public cloud, many organizations must deploy yet another silo in the form of a cloud gateway.

How they solve it: Cohesity’s storage platform transforms complex infrastructures by eliminating secondary storage siloes, such as backups, test/dev copies, files, analytics data and objects with a web-scale hyper-converged platform.

The Cohesity DataPlatform consolidates all of an enterprise’s on-premises and cloud-based secondary storage silos onto a centralized hyper-converged platform. The platform also incorporates data management functions for converged data protection, in-place analytics and copy data management to automate DevOps workflows.

Competitors include: Actifio, Commvault, Dell EMC, Qumulo, Rubrik, Veritas.

Customers include: AutoNation, Manhattan Associates, University of California-Santa Barbara.

Why they’re a startup to watch: Of the 20 finalists, Cohesity had the third-highest amount of VC funding at $160M, and they finished in the top 5 in the online voting challenge.

The startup is targeting a massive market. According to IDC, “worldwide converged systems market revenue increased 10.8% year-over-year to $2.99 billion during the third quarter of 2017.” G2M Research predicts that by 2021 the NVMe market will expand to $60 billion.

Cohesity has the leadership team, VC war chest and early customer traction to compete for a sizable chunk of that market, which is still in the land-grab phase.


What they do: Software-defined storage.

Year founded: 2013

Funding: $40M

Headquarters: Santa Clara, CA

CEO: Marc Fleischmann, who previously held the roles of SVP, GM, and corporate officer at Pixelworks.

Problem they solve: As new applications and data continue to expand at exponential rates, the rigidity and complexity of enterprise storage infrastructures have become impediments to many IT organizations, preventing them from aligning IT with business goals. While the public cloud model offers better agility and simplicity, the economics of cloud storage are cost-prohibitive for many large- and hyper-scale data environments.

Meanwhile, modern IT/development methodologies and tools, such as DevOps, containerization and orchestration are boosting IT agility, but these all exacerbate the challenge of supporting them while still relying on traditional infrastructure-centric storage systems.

How they solve it: Datera has created a software-defined storage system that the startup describes as “self-driving data infrastructure designed specifically for today’s modern hybrid IT environments.” Datera replaces rigid, infrastructure-centric enterprise storage with elastic, application-centric data services that orchestrate data at scale.

According to a Datera spokesperson, the Datera Data Services Platform’s SLO-based architecture provides “operations-free agility with enterprise-class performance and latency.” Datera’s data orchestration capabilities complement the compute orchestration of Kubernetes, Docker, Mesos, etc. By leveraging machine intelligence, the platform continuously reshapes itself to optimize performance, resilience and cost.

Competitors include: Dell EMC ScaleIO, NetApp SolidFire, HPE, Ceph.

Customers include: Packet, Vendavo, Steadfast.

Why they’re a hot startup to watch: Datera has solid VC backing, on-the-record customers, and a strong leadership team. The team’s track record as serial entrepreneurs proves they know how to lead startups to successful exits. CEO Fleischmann co-founded Rising Tide and sMeet, while CRO Flavio Santoni was EVP/GM of Engenio when it was sold for $1B to NetApp. (Santoni also previously served as CEO of Syncsort and CEO of Catalogic Software.)

Finally, getting a bit further down in the weeds, co-founder Nic Bellinger is the creator and maintainer of LinuxIO SCSI Target.


What they do: Open converged infrastructure for hybrid clouds.

Year founded: 2012

Funding: $110M

Headquarters: Sunnyvale, CA

CEO: Brian Biles, who previously co-founded Data Domain, which was acquired by EMC.

Problem they solve: Many enterprises have moved away from traditional array-based infrastructure to hyper-converged infrastructures (HCI) because HCI is a more affordable way to scale application performance. However, to fully adopt it, forklift upgrades are required, which is a non-starter for most enterprises.

Moreover, network overhead, cluster sprawl and existing investments in separate backup infrastructure prevent modern data centers from adopting HCI outside of small, single-use-application deployments. 

How they solve it: Datrium provides an HCI-like system for VMware- and Linux-based hosts. Enterprises deploy Datrium behind the firewall on either pre-loaded Datrium servers or they can install the software on their own servers. Datrium users also receive Datrium data nodes, which are durable capacity appliances for data retention and protection.

Like HCI, Datrium’s system overcomes the array controller bottleneck/upgrade problem in a way that scales automatically. Datrium integrates HCI features with scale-out backup and cloud-based disaster recovery.

With host-availability management and provisioning flexibility, end users may separate performance nodes from capacity nodes using any third-party servers. Additional features include VM backup and cloud data management. The end result, according to the startup, is that enterprises can now afford to scale low-latency, mission-critical workloads in a distributed fashion.

Competitors include: Dell EMC, HPE, NetApp, Pure Storage, Nutanix, VMware VSAN.

Customers include: Neovera, Northrim Bank, San Francisco Public Utility Commission, Siemens, University of Maryland.

Why they’re a hot startup to watch: Backed by $110 million in VC funding, Datrium has the war chest to compete with and often beat storage incumbents. Datrium has a long list of on-the-record customers from a variety of market sectors, and the startup did well in our online-voting round.

Datrium’s strongest asset, though, is its senior management team, which played key roles in several splashy exits. In 2009, CEO Biles helped lead the sale of Data Domain to EMC for $2.3B. In 2010, CMO Craig Nunes was VP of Marketing and Product at 3PAR when it was acquired by HP – after a bidding war with Dell – for $2.4B, and CFO Dave Clay was Controller at Pure Storage, which exited with a $4B IPO in 2015.


What they do: Enterprise File Sync and Sharing (EFSS) platform.

Year founded: 2012

Funding: Self-funded

Headquarters: Austin, TX

CEO: Madhan Kanagavel. Prior to FileCloud, he founded a startup that built Tonido, a personal cloud platform, which has been white-labeled by D-Link, Corsair, Freecom, Intel and Samsung for distribution on their hardware.

Problem they solve: Many information-centric organizations are nervous about losing control over data when it resides in the cloud or in third-party apps. These organizations are also concerned about vendor lock-in, which can exacerbate the data-control issue.

Info-heavy organizations continue to have petabytes of data stored in legacy on-premises infrastructure such as files servers, NAS and homespun databases. Currently, there is no easy way to migrate that data to the cloud in a cost-effective way that maintains a high level of control over that data.

How they solve it: FileCloud’s cloud-agnostic enterprise file services platform helps organizations maintain control over their data as they migrate to the cloud. Conceived of as an alternative to centralized platforms like Google Drive or Box, FileCloud allows enterprises to keep data on-premises, where they can enforce appropriate policies, while sharing, syncing and collaborating just as easily as with public cloud services. Enterprises without robust in-house IT resources may host their data with FileCloud. Hybrid infrastructures are also supported.

Competitors include: Box, Citrix, Dropbox, Egnyte, Google Drive, OwnCloud, NextCloud, Microsoft.

Customers include: NASA Kennedy Space Center, City of San Diego, Stewart Title, Fiserv, US Army (ERDC), Swiss Federal Institute of Intellectual Property, UAE Prime Minister Office.

Why they’re a hot startup to watch: As a self-funded startup, FileCloud had a steep uphill climb to make this roundup. The evaluation process probably overvalues VC funding because it is a granular and publicly available data point. Yet FileCloud summited this competition with plenty of breath left in its lungs. They have a solid leadership team, an impressive and long list of on-the-record customers and they’re positioned in a fast-growing market sector that is still chaotic enough to offer newcomers plenty of room to maneuver. FileCloud finished a strong third in Round 2 (online voting).


What they do: Enterprise flash storage.

Year founded: 2012

Funding: $60M

Headquarters: San Francisco, CA

CEO: Mark Weiner. He was previously CEO of Exanet, a clustered NAS vendor, leading it to an acquisition by Dell.

Problem they solve: Legacy storage platforms separate data storage and management into separate silos, creating a number of challenges for storage adminsAccording to IDC, nearly two-thirds of organizations are not fully confident that they could recover their data in the event of a significant disaster. IDC has also found that the most common recovery-point objective (RPO) is one hour, while the most common recovery-time objective (RTO) is four hours.

In the race to zero, businesses seeking 100 percent uptime with zero data loss (and 0 RPO/RTO) aren’t getting there with legacy approaches.

How they solve it: Reduxio’s platform unifies primary and secondary storage as well as data management. With Reduxio, end users are able to recover data to any second, while the startup claims to be able to deliver “near-zero RPO and RTO.”

Here’s how it works according to a company spokesperson: “When an IO first enters the Reduxio system, it is cached and time-stamped the moment it falls onto the cache. If the data matches an existing set on the system, the IO is discarded, and its metadata is updated with the timestamp. If it doesn’t match, the IO is compressed and stored on flash.” All hot data is stored on flash, while cold data is stored on HDDs.

Competitors include: Dell EqualLogic, Nimble Storage.

Customers include: Barnstable Police Department, Evercom, Halski.

Why they’re a hot startup to watch: With $60M in VC funding and enough on-the-record customers to prove they’re for real, Reduxio poses a serious challenge to incumbents in the “race to zero.”

Reduxio’s leadership team has a ton of experience in this space, including leadership stints at NetApp, Dell, DEC and F5 Networks, as well as successful IPOs and exits to ATT, Dell, IBM and Oracle. Reduxio was also the runner-up in Round 2 (online voting).


What they do: Cloud-based data and storage management.

Year founded: 2014

Funding: $292M

Headquarters: Palo Alto, CA 

CEO: Bipul Sinha, who was previously a founding investor of Nutanix and a Partner at Lightspeed Venture Partners.

Problem they solve: Legacy storage presents several challenges for enterprise IT, such as management complexity, lack of scale, inability to integrate with the cloud and rising costs due to the need to integrate a variety of point solutions. Moreover, with the rise of new security threats like ransomware, the enterprise needs continuous backups, instant recovery capabilities and streamlined management.  

How they solve it: Rubrik’s cloud-based, software-defined storage platform unifies backup, instant recovery, replication, search, analytics, archival, compliance and copy data management in one secure solution. Rubrik secures all data through end-to-end encryption from the source to the target location.

According to Rubrik, end users’ applications and data are “instantly accessible in an immutable format.” Immutability is the key, the startup argues, to recovering from a disaster or malware attack without losing data. “Immutability allows our customers to recover from a Ransomware attack with no data loss. Our customers have resumed day-to-day operations within minutes of an attack,” a company representative said.  

Competitors include: Dell EMC, Veritas, Cohesity, Commvault, IBM, Veeam.

Customers include: France Télévisions Publicite, Mercedes AMG Petronas Motorsport, U.S. Department of Defense, U.S. Navy CNIC.

Why they’re a hot startup to watch: Rubrik was the overall number-one-rated startup in this competition, finishing at or near the top in all assessments. Rubrik finished first in online voting, has raised more VC funding than anyone else in the competition, and their list of named customers includes such security-conscious organizations as the DoD and Navy.

Finally, Rubrik has a seasoned leadership team that includes a founding engineer of Google Fiber, a founding investor of Nutanix, and a co-founder of Oracle Exadata. The team also has experience with successful acquisitions (Tagtile sale to Facebook) and IPOs (FireEye, Atlassian).

Storj Labs

What they do: Blockchain-based encrypted cloud storage.

Year founded: 2015

Funding: $35.4M. Storj is a unique case, having raised both seed/VC funding and $30M in an ICO (Initial Coin Offering).

Headquarters: Atlanta, GA

CEO: Ben Golub, who joined Storj Labs in early March as Chief Executive and Interim CEO. Golub is the former CEO and co-founder of Docker.

Problem they solve: Blockchain technology is sparking an increasing demand for decentralized applications. To be truly decentralized, however, these applications need cloud storage that spreads data over many nodes, rather than relying on a single, centralized location. 

How they solve it: Storj Labs provides a decentralized, zero-knowledge cloud network that spreads data over many storage nodes without seeing it, neither the file itself nor the file type.

Instead of storing data on a centralized node, the Storj platform takes files, incorporates Reed-Solomon erasure encoding (which enables a file to be rebuilt from only 50% of its shards), and breaks the files into shards. These shards are then stored across an array of different nodes and backed up to additional nodes for redundancy.

Files are encrypted end-to-end when they are uploaded. When a file is downloaded from the Storj network, shards are sent to the user, compiled into one file and unencrypted after transit. 

Storj also enables end users to share their excess computer hard-drive space in exchange for a “STORJ token,” an ERC 20 token on the Ethereum network. These blockchain-powered payments are how Storj pays tens of thousands of end users for their contributions to the network, all with minimal effort and overhead.

According to a Storj spokesperson, this capability could enable the startup to, in theory, run the “world’s biggest cloud storage platform without ever owning a datacenter – similar to how Airbnb rents more rooms than any other hotel chain without owning a single property.”

Competitors include: AWS, Google, MAIDSafe, Microsoft, Protocol Labs, Sia.

Customers include: FileZilla.

Why they’re a hot startup to watch: New Chief Executive Golub knows how to lead startups to successful exits. Besides co-founding Docker (which currently has a $1B+ valuation), he previously served as CEO of both Gluster (acquired by RedHat) and Plaxo (acquired by Comcast).

Storj occupies a unique, if unproven, market sector. Despite the fact that blockchain’s biggest success story to date – Bitcoin – occupies a bubble market that has “Tulips Pt. 2” written all over it, the technology itself has undeniable appeal.

Paying end users for excess drive space in crypto-currency is a brilliant idea, and Storj is also the only startup in the competition to tap into an Initial Coin Offering (ICO), raising $30M.

Wasabi Technologies

What they do: On-demand cloud storage.

Year founded: 2017

Funding: $19.7M

Headquarters: Boston, MA

CEO: David Friend, who previously founded Carbonite.

Problem they solve: While cloud computing is sparking plenty of technological and business innovation, the cloud-storage industry still relies on first-generation architectures, which hold back adoption. Gartner notes that enterprise cloud adoption is only about 30 percent, yet the research firm still predicts that the cloud adoption rate will climb to over 80 percent by 2022.

Gartner is obviously bullish on next-generation storage technologies, and storage startups like those in this roundup help explain why. According to Wasabi Tech, while the storage services from cloud storage pioneers (Amazon, Google, Microsoft, etc.) offer cost and operational advantages over traditional on-premises storage, these services are still too “expensive, complicated and slow-performing for many digital era applications like IoT, video, research, surveillance and most anything that produces enormous amounts of Big Data.”

Consumers of traditional cloud storage must cope with unpredictable costs, vendor lock-in, complex storage tiers and a loss of control over their data, which could expose it to malicious hacking or accidental deletion due to human error.

How they solve it: Wasabi Technology’s hot cloud storage platform offers on-demand, pay-per-use storage. Wasabi has done away with storage tiers, eliminating costly management and retrieval fees. Wasabi gives companies the ability to treat all data as hot data, so they can store and retrieve critical data in a dynamic way, allowing them to proactively respond to market conditions.

To handle highly sensitive data, Wasabi has what they call an immutable-bucket feature, which protects data written to that bucket. According to Wasabi, this feature makes applications built on it HIPAA-, FINRA- and CJIS-compliant, while also protecting data from accidental deletions, application software bugs, hackers, malware, viruses and malicious destruction or alteration by employees or consultants.

Competitors include: Amazon, Dell EMC, Google, Microsoft.

Customers include: 7 Wonders Cinema, the Kim Komando Show (a nationwide radio talk show), IQ Media.

Why they’re a hot startup to watch: Wasabi’s founders have a solid track record in this market. Wasabi is the fifth venture co-founded by CEO Friend and CTO Jeff Flowers. Most notably the two co-founded Carbonite, and together they have more than 30 years of leadership experience in the storage market.

Launched only in May 2017, Wasabi has already raised an impressive amount of VC financing, nearly $20M. Wasabi already has on-the-record customers for their hot cloud storage and finished in the top 5 in the online voting round of this competition. Not bad for a year’s work.

(Jeff Vance is the founder of, a site that discovers, analyzes, and ranks tech startups. Follow him on Twitter, @JWVance, or connect with him on LinkedIn.)