Organizations are buying more flash storage than ever before, but the fierce competition in the market is forcing some vendors to make difficult changes to their growth strategies. The latest victim of the squeeze is DataGravity Inc., which reportedly laid off a significant portion of its engineering team in the past few weeks.

Former insider Michael White shared the news in a post on his personal blog that was picked up by The Register this morning. Before parting ways with the startup, he headed up the team that was responsible for ensuring DataGravity’s flash arrays work well with third party solutions from its partner ecosystem. The position involved developing integrations and authoring best practices for customers, as well as keeping track of emerging technologies that the vendor may wish to support in the future.

White said that he was terminated as part of a workforce reduction effort that also saw “many” other his colleagues receive pink slips. His post doesn’t provide any further details, but it’s likely that most of the layoffs occurred at his former unit if DataGravity decided that a department lead is no longer necessary. The restructuring comes against the backdrop of similar cuts at rival Tegile Inc., which recently dismissed half the workforce at its UK regional headquarters and shuttered a branch office in the Netherlands. Both startups were motivated by a need to cut expenses, as opposed to slowing sales, although they have markedly different end-goals in mind.

Tegile is preparing to launch an initial public offering in the foreseeable future, which will require putting forth an attractive balance sheet for investors. The vendor needs to come as close as possible to profitability in order to win over Wall Street amid the current economic turmoil, while DataGravity must address the impact of the downturn on the venture capital community. Private equity funds are much less generous with their money than they were a few quarters ago, especially in markets as crowded as the flash storage space, a fact that will force the startup to make more out of the $91 million in funding it has already raised to date.

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