Data storage startup Qumulo found itself at the intersection of two of the biggest trends accelerated by the pandemic — the rush for customers to modernize their IT, and the broader shift to the cloud.
Qumulo, led by former EMC executive Bill Richter, helps customers create, manage, and store files inside their own data centers and in the cloud. The need for Qumulo’s file data platform boomed when companies and organizations suddenly had to figure out how to operate remotely.
Seattle-based Qumulo seized the opportunity, Richter said. “We took advantage of the moment and the interest from investors to go ahead and raise additional capital,” he said.
Qumulo raised $125 million in a funding round led by BlackRock, more than doubling its valuation to $1.2 billion. The company was valued at about $553 million after its last funding round in June 2018, according to venture capital database PitchBook.
Investors have predicted funding will be harder to come by for startups over the next year, but the enterprise IT industry is expected to be more insulated from that trend — particularly those startups focused making remote work possible.
Demand for Qumulo increased during the pandemic.
Qumulo sees itself as at the center of two of the biggest trends emerging from the pandemic — the shift to the public cloud, and the digitalization of business processes.
Richter, the CEO, is known for helping to sell the last data storage startup where he was an executive, Isilon Systems, to EMC for $2.25 billion in 2010.
Companies use Qumulo to manage file data in their own data centers and in the cloud, and use the data to create new services and applications – and demand for its platform increased during the pandemic.
The Institute for Health Metrics and Evaluation, for example, used Qumulo’s platform to bring in the petabytes of health research data coming in about the coronavirus, which the organization then used to make visualizations to help people understand the pandemic.
Morgan Stanley recently published a research note detailing the technology trends resulting from the crisis. The trends included the shift to the public cloud — which the firm said “key for business survival as companies focus on improving connectivity during COVID-19,” — and what it called the “death of paper,” or companies making content and business processes digital.
Qumulo started raising its most recent round in April — not long after the pandemic began in America in full swing — and closed on Tuesday. Richter, who’s also a venture partner at Seattle’s Madrona Venture Group, said the round is an example that there will always be capital available to startups, regardless of the economic cycle.
“These global crises create a lot of change,” Richter, who’s also a venture partner at Seattle’s Madrona Venture Group, said. “And any time there’s change, there ends up being a set of winners and losers through that process.”
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