Symform Adds $8M, Sees Strategic Investor on Horizon in Cloud Backup
Competition in the cloud storage business is definitely ticking up a few notches.
Yesterday, we saw the official unveiling of Google Drive, the long-rumored online file-storage service that could draw customers from a huge base of people already using the tech giant’s e-mail, photo, and document software.
Other companies jumped out ahead of that announcement, with Microsoft’s SkyDrive and startup Dropbox both offering tweaks and upgraded features for their own online file storage systems. And today, Seattle-based cloud backup service Symform says it’s raised its second round of venture financing, $8 million, and expects to add a strategic investor later this year.
All of this activity illustrates an expanding market, made possible by the rapidly growing amount of cheap data-center capacity available to your average computer user or business.
It’s a revolution that promises to fundamentally remake many aspects of computing. Amazon Web Services, for instance, famously says that it adds enough data-center capacity each day to handle all of the IT needs of Amazon circa 2000, when it was a $2.7 billion company. And that pace will probably quicken.
Symform’s niche, however, is a bit different from those other companies I mentioned. Google Drive, Microsoft SkyDrive, and Dropbox are mostly focused on letting individual users and groups of co-workers store and transfer files in a cloud network. Amazon Web Services offers a wide array of services, but most of them are aimed at helping businesses get more affordable and flexible computing power or raw storage capacity on servers.
In contrast, Symform is focused on cloud-based backup, helping customers ensure that their valuable data doesn’t disappear if their local server or other storage devices crash. That’s a sector with its own set of big competitors, including Mozy (part of storage giant EMC), Symantec, and Carbonite.
In an interview, Symform CEO Matthew Schiltz and co-founder Praerit Garg tell me that Symform now has “tens of thousands” of customers, a pool that has doubled in the past quarter and has expanded to cover users in nearly 140 countries.
Symform plans to keep speeding up that growth with its Series B investment round, led by previous investor WestRiver Capital and including fellow existing investors OVP and Longworth Venture Partners.
The round could grow by another $3 million if Symform adds another business as a strategic investor, which Schiltz expects to come this year. “We’re in active discussions now, but nothing to announce,” he says.
Symform’s cloud storage system is built on a different technological foundation than other providers in the sector.
The key is that data being stored on the network doesn’t sit in one company’s data center. Instead, it is distributed among a bunch of different nodes in the network, which are contributed by the users themselves—to get space in Symform’s cloud, users offer up a chunk of space of their own.
To protect against file loss and ensure security, the Symform system breaks files up into pieces and distributes them across the network. That means nobody has anyone else’s entire file on their piece of the network, allowing Symform to manage the secured chunks and reassemble whatever’s needed when it’s time to call on the backed-up files.
“We see companies pop up here and there occasionally” that are making a stab at the same kind of technology, Garg says. “But we haven’t seen anybody get any traction, or even have really developed the technology.”
Schiltz says Symform could see the pace of its growth speed up later this year through increased partnerships with storage-device manufacturers—it announced a deal with QNAP last year, and expects more in the coming months.
“So when a disk drive or network-attached storage device comes with Symform on it, you can contribute space and point folders at the cloud,” Schiltz says. “We think that will accelerate the adoption of this type of distributed storage technology.”
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