UPDATED 10:02 EDT / NOVEMBER 01 2011

Storage Startup SolidFire Raises $25M in Fresh Capital

Boulder, Colorado-based SolidFire raised $25 million in its second funding round from New Enterprise Associates, as well as Valhalla Partners and Novak Biddle Venture Partners.  All three participated in SolidFire’s first round back in February, when the startup raised $12 million.

Three individual investors, including former Data Domain CEO Frank Slootman also contributed to this latest round.

SolidFire offers an all-flash storage array and appropriate software to as-a-service cloud technology providers that signed up for its Early Access program. That includes an SF3010 storage unit, an eScanner tool and technical services, ie support and integrations provided by the company.

“Funds will be used for the rapid expansion of the sales and marketing departments to support growing customer demand for the company’s all-SSD systems in the cloud,” SolidFire said in a statement.

SolidFire claims some of the “largest cloud companies in the world” have signed up for a trial run via Early Access, though didn’t name any specific firms.  Nevertheless, Jay Prassl, SolidFire’s vice president of sales and marketing did name its main competitor: EMC and HP 3PAR.

The startup still has a lot of room for growth, and it hopes this new funding will help push its strategies a bit further.  The company already managed to build up some VC attention thanks to its market angle: focusing solely on cloud service providers, SolidFire’s SSD technology introduces a lot of automation to their infrastructure, thus allowing them to present more impressive SLAs to clients.

“SolidFire is focusing exclusively on cloud service providers, and with $30+M raised so far and a laser focus on CSPs, it’s a competitive advantage for them,” says Wikibon senior analyst Dave Vellante.  “Specifically, while others are building channels for the enterprise, which is time consuming and very expensive, SolidFire is focused on the CSP market, which has very specific requirements around quality of service and management.

“Focus is the key and this sends a message that SolidFire is unique and building a competitive advantage.  The key for the company now is execution – it has to get a product to market that is proven to support the tier 1 apps that it is marketing toward. “

While  it is more expensive, flash can undoubtedly contribute more to the enterprise IT infrastructure on the long run in terms of ROI.  A few companies are innovating here with new offerings and software, including Fusion-io, perhaps the fastest growing company in this industry. It recently appointed Woody Hutsell as its new director of product management, a Vion veteran.


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