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September 26, 2012

VCs Invest $26 Million in Flash Storage Startup Virident Systems

By Ashok Bindra, TMCnet Contributor

Flash storage is gaining momentum and venture capitalists (VCs) are eager to fund startups in this field. As this new technology gains traction in the data center world, new players are emerging to serve this growing market. One such entrant is Milpitas, Calif.-based Virident (News - Alert) Systems.

According to a report by Christina Farr of Venture Beat, flash storage startup Virident Systems has raised $26 million in fourth round funding, which was led by Mitsui Global Investors with participation from Globespan Capital Partners, Sequoia Capital (News - Alert), and Artiman Ventures. This latest round brings the company’s total funding to $76 million.

As per the Venture Beat report, Virident has also hired a new CEO, Mike Gustafson, a former senior vice president and general manager at Hitachi Data Systems (News - Alert). Gustafson is also expected to join the company’s board of directors.

Gustafson told Venture Beat that this space is crowded with legacy vendors and startups, but market opportunity for flash is big enough for everybody. “Flash will be the touch point in every part of the data center infrastructure,” commented Gustafson. He added, “There is tremendous confidence around this space.”

Farr wrote that companies like Virident claim that data centers are running out of storage space and need a reliable alternative. But Gustafson thinks that Flash-based memory is still too expensive to be a data center’s primary storage technology. However, the new CEO sees solid-state disks replacing mechanical hard disk drives in the coming years.

In a statement, Sanjay Pichaiah, investment director at Mitsui Global Investment, said, “The Flash storage market is predicted to grow to $4 billion by 2015, and this investment only strengthens our conviction that Virident will become the primary industry provider of the fastest storage class memory solutions to the world’s leading enterprise data centers.”

 The Venture Beat report indicates that Virident has been able to attract high-tech companies because it promises to reduce cost and deliver performance that is 10 times faster than the competition. Farr wrote that Virident nearest competitor is Fusion IO, a memory storage company whose chief scientist is Apple (News - Alert) co-founder Steve Wozniak.

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO Austin 2012, taking place Oct. 2-5, in Austin, TX.  Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.

Edited by Rich Steeves
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