olly - Fotolia
Coho Data is the latest casualty of a punishing funding market for data storage startups.
The Palo Alto, Calif., vendor confirmed it abruptly ceased operations last week after failing to secure operating capital. Coho Data secured more than $76 million since its inception in 2012, but has not received investment since May 2015. Rumors of its demise started circulating about a week ago.
Trouble first surfaced at Coho Data when it initiated a round of layoffs in early 2016. A Coho Data customer who did not have permission to speak publicly said his organization recently purchased a SAN from another vendor after Coho failed to respond to support requests. The formerly active Coho Data blog page hasn't been updated since April 2016.
Co-founder and CTO Andrew Warfield said changing dynamics in the storage industry contributed to Coho Data's downfall. He cited the emergence of converged and hyper-converged systems, plus enterprises' growing affinity for the cloud as a storage tier.
"Storage is getting to be a fairly challenging industry [in which] to raise capital. The reality is that it's a cutthroat market and it's really hard to differentiate," Warfield said. "We obviously wanted to continue moving forward with the company and continue serving customers. We just got to a point where we couldn't find any viable options" to sustain operations.
Most of the big funding rounds in storage now are going to backup and data management vendors such as Rubrik, Cohesity and Druva.
Warfield launched Coho Data with Ramana Jonnala and Keir Fraser. Prior to that, the three men created the open source Xen hypervisor at XenSource, which Citrix Systems acquired in 2007 for $500 million. Jonnala was the Coho Data CEO and Fraser was its chief architect.
Coho Data arrays bundled DataStream scale-out NAS software on Supermicro servers. DataStream also was licensed under an OEM deal with Hewlett Packard Enterprise, which packaged it on Apollo servers. That product, branded as the HPE Complete Coho Data platform, marked Coho Data's incipient attempt to market DataStream as a software-only product supported on qualified hardware.
HPE executives were not available to comment on what Coho Data's closing means for customers who bought DataStream on Apollo servers. Warfield said he did not know how many Apollo-DataStream units had been sold.
This has been a tough year for storage startups. Software-defined Formation Data Systems went under and DataGravity ceased operations before cloud security vendor HyTrust bought its assets. It's a sign that investors are less patient with new storage vendors than in years past, said Henry Baltazar, a research director of storage at IT analyst firm 451 Research.
"Investors are betting on the potential winners, but unless you're generating revenue or are a Cohesity or a Rubrik, it's going to be hard to get funding," Baltazar said.
Rubrik cloud management soars with $180 million funding grab
Tegile's NVMe path paved with gold
Object storage squares off against scale-out NAS. Which will win?