NeoPath Nabs $12M

NeoPath Networksis jumping into the emerging -- and increasingly crowded -- NAS consolidation space with a $12 million Series B funding round. Its product is expected by the end of the year.

Gabriel Venture Partners led the Santa Clara, Calif.-based NeoPaths funding round, with previous investors August Capital, Doll Capital Management (DCM), and Dot Edu Ventures participating in the round. Gabriel Ventures general partner Navin Chaddha joins NeoPath’s board.

NeoPath’s founder and CEO Rajeev Chawla says the funding will be used to build sales, marketing, and product development for the 30-person startup.

NeoPath’s software runs on hardware appliances to provide global namespace for files. That allows NAS file servers to access files regardless of where they reside. Chawla claims its appliances are running in beta sites now, and he expects revenue later this year.

NeoPath’s first funding of $6 million came in the spring of 2003 when the company was called Meta Data Systems. But the startup didn't announce the funding until last March. That’s also when it changed its name to NeoPath.“We changed the name to reflect our position and product: network file management,” Chawla says. “We want to shift intelligence from the file system into the network and provide a unified view of the network.”

NeoPath isn’t Chawla’s first startup. He started data encryption vendor Ingrian Networks Inc. in 1999 and founded Meta Data three years later with three other Ingrian executives (see Ingrian Debuts Network Crypto). The other Ingrian vets at NeoPath are CTO Anand Iyengar, chief software architect Panos Tsirigotis, and engineering VP Thomas Wong.

NeoPath’s underlying technology is not an original concept. Startups Acopia Networks Inc., NuView Inc., Rainfinity, and Z-force Inc.

all ship products that do the same thing to various degrees. (See Acopia Ships Its Switch, Arkeia Drives on Interstate, Rainfinity Gets Reinforced, and Z-force Thinks Zmaller.)

So if it’s not first, then NeoPath will probably have to be better to survive -- right?

Maybe. Stephen Beer, NeoPath’s director of product management, says the other startups only do pieces of what NeoPath can accomplish. “They have attempted to solve this issue,” Beer says. For now, though, he won't say exactly what NeoPath does or how it does it.There certainly seems to be a market for the technology. Leading NAS vendor Network Appliance Inc. (Nasdaq: NTAP) paid $300 million to acquire Spinnaker Networks because Spinnaker’s file system could connect multiple devices (see NetApp Maps NAS Path and NetApp Annexes Spinnaker). NetApp also offers NuView software and partners with Rainfinity to allow users to consolidate storage on its NAS devices (see NetApp Ships NuView NAS App and NetApp Smiles on Rainfinity). And at least some in the industry are still waiting for EMC Corp. (NYSE: EMC) to acquire global namespace for its NAS systems (see EMC Challenges NetApp NAS).

— Dave Raffo, Senior Editor, Byte and Switch