Aiming for Third-Time Charm, San Diego’s Astute Networks Raises $12M

6/18/12Follow @bvbigelow

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the company in October 2010, shortly after Astute Networks was recapitalized. Using proprietary technology the company had developed for its data storage equipment, Astute Networks developed technology that it calls a DataPump Engine to optimize the performance of virtualized networks by accelerating both data storage (iSCSI) and network (TCP/IP) traffic.The engine runs on a proprietary flash architecture in a series of network appliances that make up its ViSX product line, with unit prices ranging from under $20,000 to about $70,000.

“I got 100 percent benefit of a fully built and tested IP [intellectual property] that I didn’t have to spend a nickel to develop,” Topper says. “We’ve integrated it into a new user-based appliance without spending literally tens of millions of dollars in development.”

Whether the third time will be the charm is another question. Before joining Astute Networks, Topper was the founder of JumpStart Partners, a business advisory firm, and previously served as the CEO of Cerebra, an enterprise software developer in Carlsbad, CA; as an entrepreneur-in-residence at eCentury Capital Partners; and as CEO of New Hampshire-based Platypus Technology (a maker of solid-state storage systems) and other technology companies.

One advantage to the company’s strategy is that its technology is relatively non-denominational, and operates on VMware vSphere, Microsoft Hyper-V, Citrix XenServer, and Red Hat RHEV. “We know the VMware ecosystem, and focus on VMware because it represents 70 to 80 percent of the market,” Topper says.

“Our target customer is an organization that has virtualized the enterprise [network],” Topper says. “About 30 percent of enterprises have hit the glass ceiling in terms of deploying mission critical systems into virtualized networks.” The core market would not necessarily be small-to-medium businesses, he said, but rather mid-market and small-to-medium enterprise companies.

Including its $12 million B round, Astute has raised a total of $17.5 million since 2010. In addition to Samsung (a leading provider of NAND flash memory), current investors include Tallwood Venture Capital, Narra Venture Capital. Other new investors are Ayala Capital, ICCP Venture Partners, and The Investment Fund for Foundations (TIFF).

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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