Nirvanix Nabs $12M

Nirvanix clinched $12 million in series B funding today as the startup prepares to take aim at Amazon in the hosted storage services market.

The round, which was led by Mission Ventures and Valhalla Partners, also included Windward Ventures. It brings Nirvanix's total funding to $14.5 million.

Nirvanix, which picked up $2.5 million from angel investors and research grants from California State Polytechnic University, Pomona, is one of a number of vendors pushing outsourcing as the solution to users' data storage woes.

Like rival Amazon's S3 service, Nirvanix charges a set monthly fee for the amount of data stored on its hardware, which can be accessed via the Web by customers. The startup's Storage Delivery Network (SDN) is a 2-Pbyte storage cluster spread across three "nodes" housed in U.S. colocation facilities.

With the series B burning a hole in his pocket, Nirvanix CEO and co-founder Patrick Harr is hoping to more than quadruple this infrastructure over the next 12 months. "We expect that we will have 12 to 15 nodes," he says, adding that some of these will be in Europe and Asia. "We have some specific sites in mind, but we haven't publicly announced those."The CEO is also planning to grow the 35-strong Nirvanix workforce by this time next year. "I expect that we will be close to double," he says. "We're expanding on the sales side, as well as data center operations."

Nirvanix, which emerged from stealth last week, already has around 40 beta customers, although the company faces stiff competition from Amazon.

Unlike many startups, Nirvanix will not be looking to undercut its better-known rival's pricing when it launches SDN. At 18 cents per Gbyte per month for stored data, Nirvanix's service will work out more expensive than Amazon's S3, which is priced at just 15 cents per Gbyte.

Where Nirvanix claims an edge over its rival is in service, offering SLAs for customers. The startup is also developing what it describes as "mini-nodes," which will be aimed at the service provider market.

"These will reside within the service providers' data centers, and they will be able to resell the storage capacity to their customer," says Harr. "A lot of the hosting providers view Amazon as competition, so they are looking for someone who can provide them with economical storage that they can offer to their own customers."Nirvanix is also eying up storage opportunities tied to rich media content. "We're very media focused -- we believe that developers will see the benefit of using SDN for rich media applications," he says, explaining that the startup can convert high-definition TV files into a format that could be viewed on a cellphone.

"You will see more media-focused, media-optimized services [coming out of Nirvanix] in the next month and a half," adds Harr.

Nirvanix, which was incorporated this year, was born out of a research project at California State Polytechnic University. The result of the research, an "Isilon-style" software-based file system, is now at the heart of Nirvanix's SDN offering, linking the startup's network of Dell servers and Seagate storage.

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