12 Hot Cloud Computing Companies Worth Watching

While big-name players such as Amazon, Google, IBM, Verizon and VMware sit atop the burgeoning cloud computing market, an entire ecosystem of early stage startups are looking to stake their

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Why we're watching: Maginatics offers a file storage system that company officials say could provide a whole new way for IT administrators to exploit cloud-based resources while maintaining data security and control.

The company's MagFS file management system, which it launched at VMworld, overlays cloud or on-premise storage to create a distributed file system that can be accessed via mobile devices.

One of the impressive things about Maginatics is the cadre of talent on its executive and advisory team. CTO Jay Kistler, former VP of engineering at Yahoo, holds a doctorate from Carnegie Mellon and previously served as chief architect for platform technologies at Akamai. Chief Architect Niraj Tolia is a former senior researcher at HP Labs, while CEO Amarjit Gill sold his last company, Agnilux, to Google, and his previous one, P.A. Semi, to Apple.

The secret sauce behind MagFS is a software design that separates data and the underlying bits and bytes that make up the information, which is encrypted at the granular level. This creates a plane for controlling the data and another for transferring and accessing information. Separating the two means data security can be centrally managed by IT, while allowing for it to be accessed on a range of devices. Users download a mobile client that decrypts the data and allows it to be accessed if they have the appropriate keys, which are centrally managed by the system. "This opens up economic benefits and access to data without sacrificing security," Kistler claims.

MagFS is different from other file sharing and document management systems because it's software, not a service, like Box, DropBox or Egnyte. "Enterprise IT has become a service provider," and IT needs ways to control the data, Kistler says.


Focus: Amazon Web Service monitoring, optimizationA Founded: 2010A Location: Tel Aviv, with plans to move its headquarters to the United StatesA Management: Co-founders Zev Laderman and Ilan Naslavsky once sold a startup to SunA Funding: $4 million from Greylock Partners, Index Ventures and Eric Shimidt's Innovation EndeavorsA Fun fact: Originally were going to name the company Nuvem, which means "cloud" in Portuguese, but because that domain name was not available, settled on Newvem

Why we're watching: The folks at Newvem know a thing or two about efficiency analytics.

This is the second startup for CEO Zev Laderman and CTO Ilan Naslavsky, who got together in the mid-2000s to create Aduva, an open source analytics firm that was eventually sold to Sun Microsystems and later rolled into Oracle. This time they're focused on becoming the go-to source for analytics related to usage of the most popular cloud vendor in the market: Amazon Web Services.

Newvem has a read-only API call that sends customers' data provided by AWS into an analytics-pumping machine, which then informs customers how efficiently they're using AWS services and recommends ways they can save money. The company's product is in public beta and it's expected to be generally available this fall.

Initial prototypes of the Newvem service included analytics around the most important metric for most customers -- cost. Initial results proved fruitful: Newvem says it helped all 40 of its alpha customers spend less money by reducing the number of servers they order from AWS. Customers in total yielded a 33% savings on weekdays and a 50% savings on weekends from turning off idle servers. Further iterations of the product focused on right-sizing servers to ensure customers are ordering only the compute and storage instances they need. Newvem now focuses on four metrics: Utilization, availability, security and spend efficiency.

Once the product hits general availability, Laderman says it will be able to handle anything from individual users all the way up to organizations running tens of thousands of servers on AWS, with pricing based on utilization. Down the line, Laderman hopes to one day expand the business outside of just monitoring AWS to provide analytics of other cloud platforms, eventually being able to advise clients on which public cloud platform may be best for them based on their usage and the cloud provider's pricing.


Focus: Application deployment, management and optimizationA Launched: 2011A Location: PhiladelphiaA Management: Three co-founders are former eBay engineersFunding: Self-funded by foundersA

Why we're watching: In cloud computing when you need a new virtual machine, you can simply go to any number of providers, click a few buttons, supply your credit card information and you have a new server ready to go. Same with storage, which can be scaled based on demand. Launching applications, though, is different and not as simple, say the folks from OneOps. Their system aims to make it easier.

OneOps originated from a group of eBay engineers who found that launching applications is in many cases a painful and cumbersome process. OneOps provides continuous and full-circle lifecycle management for simple to complex applications. In the OneOps control panel developers are able to pull in various attributes that an application will need. One application may need a MongoDB, while another may need to be written in PHP, while some may be launched in an Amazon cloud and others in an OpenStack-powered cloud. OneOps allows these differentiating features of an application to be centrally managed, meaning developers can provision and launch applications as needed. Just like spinning up infrastructure services from the cloud, OneOps is taking that idea to launching applications in the cloud.

Co-founders Vitaliy Zinchenko, Kire Filipovski and Mike Schwankl noticed the problem of application management while at eBay where Filipovski managed engineering services for the online auction site. "We were handing over applications between multiple teams just to get them launched," Filipovski says. "It can take 40 tickets to deploy a simple application." The issue gets back to a fundamental friction between development and operations teams, he says. OneOps, he hopes, increases the agility of being able to launch applications. The company uses an assembly line approach to install repeatable patterns used to create applications, allowing developers to iterate from application to application.

The founders have bootstrapped the startup since launching it in March 2011 and releasing the product in May of this year in private beta. They're now seeking outside funding as they expand their go-to-market strategy.

Pertino Networks

Focus: Software-defined networking as a cloud-based serviceA Founded: 2011A Location: Cupertino, Calif.A Management: Former Packeteer CEO Craig Elliott, who's also an ex-Apple execFunding: $8.85 million from Norwest Venture Partners and Lightspeed Venture PartnersA Fun fact: Name is short for the town it is headquartered inA

Why we're watching: SDN technology is discussed mostly in the context of large enterprises and services providers, but one veteran network company exec has his own plans to bring SDN to the masses, and specifically to small and medium businesses via the cloud.

Craig Elliott -- former head at network appliance company and Blue Coat Systems acquisition Packeteer Networks -- was fly-fishing in New Zealand last year when former colleagues pitched him this idea: Use the cloud to deliver sophisticated networks to small and midsize businesses through a straight-forward portal.

Today's networking landscape is a box-centered world, Elliott says. Everything requires a piece of hardware. "There's a million companies selling boxes," he says, admitting that Packeteer was one of them. "If you want any sort of WAN optimization, security or another feature, basically that means you need to buy another box. That takes the mid-market and small market guys out of the picture," he says. "It's too expensive and too complicated." By using a cloud-based service and local access clients, a business can quickly provision a wide-area network, without a massive investment in hardware boxes.

Founded last year, Pertino has been operating in stealth mode, providing scant details of its plan until this past spring when it announced almost $9 million in venture financing. The team is made up of Elliott and a cadre of engineers he worked with at Packeteer, including co-founders Scott Hankins (who also spent time at NASA) and Andrew Mastracci. Pertino's product is currently in private beta, with plans to launch in early 2013.

Elliott sees a huge market opportunity given the increased reliance small businesses will have on communications and network technology and the challenges of managing a mobile workforce. Combine that with the ease and simplicity that businesses will become accustomed to with cloud-based services, and Elliott hopes his team will have a company worth watching.


Focus: Multi-cloud monitoring and management tools A Founded: 2010Location: San Mateo, Calif.A A Management: Co-founders' former startup sold to BMC for $800 millionA Funding: $13.5 million from Accel Partners and Ignition PartnersAvailability: Free, generally available SaaS download, some additional analytics features still in private beta

Why we're watching: As cloud computing continues to gain prominence, Nand Mulchandani doesn't believe that enterprises will be keen on putting all their eggs in the basket of one public cloud service provider. They will spread their risk and federate workloads across multiple clouds.

"Customers are building distributed data centers," says Mulchandani, CEO and co-founder of ScaleXtreme. "All of a sudden your servers are no longer in one location, they're potentially in multiple locations, on multiple infrastructures. But they still need to be managed."

ScaleXtreme allows customers to centrally monitor and provision public clouds from a dozen vendors, including Amazon, Azure, Citrix, Dell, Rackspace, VMware and others. Users can see how much CPU, disk storage and various other resources are being used on all of their cloud deployments at once, while monitoring downtime and ensuring security controls are up to date. ScaleXtreme can also be set up to automatically update security patches on virtual machines running on multiple clouds, and it can be configured to back up data or do audit checks of workloads running across public clouds. ScaleXtreme can also be configured to monitor multiple internal, behind-the-firewall data centers or private clouds, all through a single pane of glass.

Company co-founder and CTO Balaji Srinivasa has roots in data center automation, having served as principal product architect for BladeLogic, which was acquired by BMC in 2007 for $800 million. That automation background is seeded deep in ScaleXtreme. The technology works by installing an agent on the public cloud services that connects back to ScaleXtreme's cloud, which does the legwork. The ScaleXtreme system then is able to not only monitor the health of the clouds, but also command them based on the client's needs.

Next up for ScaleXtreme will be going beyond monitoring and provisioning and into predictive analytics. The company recently launched its first tools in that area, which give customers advice on how to provision the exact amount of resources that will be needed based on their history and the experience of other customers.

Social Dynamx

Focus: Social media analyticsA Launched: 2011A Location: Austin, TexasA Funding: $2.9 million in angel fundingA Availability: Publicly available

Why we're watching: Gone are the days of relying solely on 1-800 customer service numbers to air grievances with companies. Twitter, Facebook and other social networks allow customers to complain, and put public pressure on companies to clean up their acts.

All of which has companies scrambling to monitor such social media activity so that they can weed through the fire hose of tweets, posts and messages.

Social Dynamx is trying to address this market with a product delivered as cloud-based software as a service (SaaS) that provides businesses and workers in contact centers with the ability to monitor, analyze and respond to consumer communications. Social Dynamx estimates that 70% of brand tweets go unanswered today, along with a whopping 95% of Facebook posts. "I literally see social media transforming what we know of in the contact center today," says President and COO Jan Ryan.

While there are a variety of other companies that provide social network monitoring, Ryan says Social Dynamx goes the extra mile to provide analytic tools on top of the stream of information it collects. Social Dynamx can be added on to social media monitoring tools, analyze information they collect and prioritize it based on the necessity of a response. "We basically filter out the noise and surface out things that are relevant, placing them in an actionable cue so you know what needs to be prioritized," Ryan says.

The company was founded by a group of enterprise collaboration and business analytics veterans, including Ryan, who was CEO of Sigma Dynamics, which Oracle acquired in 2006. Social Dynamx's CEO Mike Betzer headed up MCI's contact center operations before helping to start Social Dynamx.

The company uses Java-based software that is hosted in the Amazon Web Services cloud to filter and prioritize information it gathers from the social media world. Social Dynamx works with individual customers to customize search terms, and target terms and specific vocabulary related to the company's product names, executives or services. The company even offers integration with customer relationship management (CRM) software to log communications and prioritize interactions with high-profile clients.


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