Qumulo Secures Round C Prime Funding – My Conversation with Bill Richter

Qumulo logoToday, Qumulo, vendor of the software-defined scale-out storage platform Qumulo Core, announced the completion a funding round of $30 Million. This C Prime round of funding brings the total amount invested in Qumulo to date to $130 Million.

This new funding round was led by Northern Light Venture Capital and other first-time investors in Qumulo. Previous Qumulo investors Kleiner Perkins Caufield and Byers (KPCB), Madrona Venture Group, Top Tier Capital Partners, and Tyche Partners also participated in this round.

This new round of investment in Qumulo follows some recent management changes that include the appointments of

  • Bill Richter (formerly of Isilon) as CEO
  • Jay Wampold as Vice President of Marketing
  • Eric Scollard as Vice President of Worldwide Sales

As long-time readers will know, I’ve been a fan of Qumulo since the beginning. At my previous employer, I was the PreSales Engineer in a deal where we sold a Qumulo cluster even before the company had emerged from stealth mode. At Qumulo’s invitation, I attended the company’s launch party.

So, you can imagine my excitement when Bill Richter and Jay Wampold took some time out of their busy day yesterday to spend some time speaking with me about today’s announcement and anything else I felt like asking them.

The Funding Round

I specifically asked how many new investors had backed Qumulo in this round of funding. Seeing as Qumulo is privately held and some of their investors have chosen to not yet reveal themselves publically, Bill and Jay declined to answer this one.

Bill did, however, say that there has been a “significant increase in inbound interest” in Qumulo. In fact, their funding round was oversubscribed (meaning that they’d set out to raise $30 Million and found investors whose willingness to invest in Qumulo totaled more than $30 Million). When pressed, Bill said that two-thirds of this round’s investment was “new money”, i.e., from organizations who had not previously invested in Qumulo.

Similarities to and Differences from Isilon

I asked Bill what commonalities he saw between Qumulo’s corporate culture and Isilon’s. He said, “We’re innovative disruptors. We’ve taken the status quo — that most customers are dissatisfied with — and said that it doesn’t need to be that way. It’s about focusing on the customer’s experience.”

When I asked if he saw any significant differences between the culture at Isilon when he was there and the current culture at Qumulo, Bill said the following:

“The biggest thing is that the world has changed so much. Isilon was working to be an appliance, but Qumulo is 100% software-defined. It’s a completely different approach.”

“Qumulo was founded by the core group that wrote Isilon’s OneFS. Like any other project, if you knew then what you know now, you would get to avoid the mistakes you made, plus you know the current marketplace.”

As an example of the marketplace changes, Bill talked about public cloud. Isilon wasn’t designed with the idea of connecting to public cloud in mind from the start — why would it have been? There wasn’t anything like today’s public cloud options available back then. Qumulo, however, has been able to take the idea of moving data to the Cloud into account from the start.

Unanswered Questions

While, yes, I’m a Qumulo fan, that didn’t mean I was going to go easy on them. Here are the questions I asked that went unanswered:

  • Shortly after launch, Qumulo’s stated goal was 50% revenue from existing customers and 50% from new customers. A year or so ago, the actual revenue was 35% from new customers and 65% from existing ones. What is the actual ratio today, and what is your goal ratio?
    Bill and Jay declined to offer any information at all about their current sources of revenue. Bill did say that. “50/50 is still the goal.”
  • Qumulo’s announcement touts a 425% year-over-year growth in Petabytes of storage shipped to customers. What does this translate to in terms of year-over-year revenue growth?
    I was very simply and plainly told that this isn’t public information and that Qumulo doesn’t disclose revenue numbers.
  • What new enterprise storage features can we expect from Qumulo in 2017?
    Bill said that I’d “just have to wait” for new feature announcements.

GeekFluent’s Thoughts

  • All-in-all, I remain a Qumulo fan. Their scale-out storage is Good StuffTM and the real-time analytics offered by their management interface are great.
  • That investors are willing to put more money into Qumulo, especially at a time when it’s tough to be a storage start-up, is a good sign for them. There had been rumors that Qumulo was running out of money. If true, this new funding should alleviate concerns.
  • Qumulo is pushing hard on their “we are 100% software-defined storage” message. This seems aggressive to me when, until fairly recently, the only way customers could acquire the Qumulo Core software was to purchase the hardware appliances sold by Qumulo.
  • Qumulo is pushing the software-defined message so hard that I’ve heard them say that “customers can run the Qumulo Core software on any third-party server hardware they want to”. I suppose this is technically true if the only third-party server hardware customers want is the HPE Apollo server. Because, as of the moment, Qumulo doesn’t support it on any other third-party hardware at all.
  • In my opinion, Qumulo needs to announce support for at least two other vendors’ server hardware before the end of 2017 to keep credibility for their software-defined message. I’m just not sure what their options are if they also want the hardware vendor to support it as well.
    • I doubt we’ll see Qumulo Core supported on Dell servers as Qumulo is a clear direct competitor to Dell EMC’s own scale-out NAS platform, Isilon.
    • Qumulo Core on Cisco UCS seems unlikely as well given Cisco’s use of SpringPath’s data virtualization layer for their HyperFlex HCI platform. On the other hand, Cisco might see it as a good example of a use case for their UCS S3260 product.
    • Earlier, I might have thought that Lenovo could be an option, but given the recent launch of the Lenovo DX8200D running DataCore Software‘s software-defined storage option, I see this as unlikely.
    • I’m sure SuperMicro would be happy to offer support for Qumulo Core, but for most enterprise customers, SuperMicro doesn’t scream “Enterprise platform”. Regardless of whether or not that’s an unfair viewpoint, it’s one I’ve heard expressed by many enterprise organizations.

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