Pivot3 Picks Up $24M

iSCSI SAN startup Pivot3 will announce $24 million in Series C funding next week, as the vendor plans to ramp up its sales efforts and target areas outside of its traditional video surveillance niche.

The round, which was led by Mesirow Financial Capital Partners, included Silver Creek Ventures, Lightspeed Venture Partners, and InterWest Partners, bringing Pivot3's total funding to $46.5 million.

"It's for increasing sales and marketing activity and product development," says Robert Fernander, the Pivot3 CEO, explaining that he will increase the firm's workforce from 50 to 70 within 12 months.

"In the latter part of this year, you will see us enter some new markets -- we're planning that activity now," he notes. "The things that are adjacent to what we do today are streaming video and rich media for things like static images."

At the moment, more than a dozen customers are using Pivot3's distributed RAID system, largely for storing video surveillance data.The startup claims a new approach to handling this data thanks to its block-level virtualization software. Running on Intel-based servers, Pivot3 describes its offerings as RAID Across Independent Gigabit Ethernet (RAIGE).

The Spring, Texas-based vendor claims that the virtualization software removes the need for a traditional RAID controller, such as NetApp's filer head, while ensuring that data is written across servers in a cluster. This approach offers users up to five times the throughput of a traditional RAID system, according to the vendor.

Pivot3 will also use its Series C money to expand its U.S. operations. "We have a small office in Palo Alto East, and we will be expanding that footprint into a new facility in San Jose," says Fernander. Other offices may also be opened in Tampa, Fla., and Washington, D.C, with the latter targeting federal government customers.

The CEO tells Byte and Switch that his firm's main competition comes from direct-attached systems sold by vendors such as IBM, Sun, and NetApp. "The biggest challenge is educating customers about the architectural disruption that takes place when they deploy hi-res surveillance video."

Other players in this space include iSCSI vendors like Intransa, LeftHand Networks, and EqualLogic, although Fernander claims that his firm is already gaining traction."The average selling price [for our systems], that we expected to be small, is well north of $200,000 on average. We're deployed in a couple of markets where [users] are deploying lots of high-res cameras that are increasing storage requirements substantially."

On the product side, Pivot3 is also planning to upgrade its software over the coming months. "You will see us move the bar up significantly, well beyond RAID 6-type availability later this year," explains Fernander, adding that this will come in the form of a software enhancement.

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