UPDATED 06:00 EST / MAY 07 2018

CLOUD

Mesosphere raises $125M round to expand data center platform worldwide

Mesosphere Inc., the San Francisco-based company that aims to be something of a cloud-era Microsoft Windows for large companies’ hybrid data center and cloud operations, today said it has raised a $125 million late-stage funding round.

The new Series D round brings total financing to more than $250 million.

New investors T. Rowe Price Associates Inc. and Koch Disruptive Technologies led the round, joined by China’s ZWC Ventures, the Qatar Investment Authority and Disruptive Technology Advisers. Existing investors Andreessen Horowitz, Two Sigma Ventures, Khosla Ventures and Hewlett Packard Enterprise Co. also joined in.

Among the most important new investors is Koch Industries’ venture arm. “We are positioned to be the IoT platform of choice for their vast manufacturing operations,” co-founder and Chief Executive Florian Leibert told SiliconANGLE in an interview. In addition, ZWC and the Qatar Investment Authority will help open up new markets to Mesosphere in China and the Middle East, he said.

Not least, the funding provides a war chest to compete with many other companies from public cloud giants such as Amazon Web Services Inc. to Red Hat Inc. and the Dell Technologies Inc. majority-owned Pivotal Software Inc., which recently raised $497 million in an initial public offering.

The five-year-old Mesosphere grew out of a project at Twitter Inc. that aimed to solve it many problems scaling up to meet traffic needs by consolidating many services such as search from individual machines into large servers. The company, whose founders include the creators of “hyperscale” infrastructures at Twitter and Airbnb Inc. and of the open-source Apache Mesos software.

It built a suite of open-source infrastructure tools based on the Mesos project that enables data centers to be virtualized at a massive scale. Essentially it aimed to make the data center look like one big computer with its Data Center Operating System, or DC/OS.

It’s now used by the likes of Royal Caribbean Cruises Ltd., Yelp Inc., Tommy Hilfiger Corp., Deutsche Telekom, and about 125 other large companies. They use it to ease the transition from traditional data center software to leading-edge cloud and data analysis software and services run on-premises and in the cloud as needed, such as Docker software containers for making it easy to run applications on multiple kinds of computers, the open-source machine learning framework TensorFlow and the Apache Spark data analysis software.

“We want to double down on these disruptive technologies,” Liebert said. The funding will be used to get more open-source software onto its platform to make it easier to use and also for global expansion efforts. The company currently has about 300 employees.

“The rapid pace of innovation has left many enterprise companies rushing to adopt containers and microservices but hitting a roadblock when it comes to incorporating data services,” Rhett Dillingham, vice president and senior analyst at Moor Insights & Strategy, said in a statement provided by Mesosphere. “Mesosphere DC/OS eliminates that roadblock, allowing companies to automate Kubernetes operations alongside data pipelines made up of the most popular open-source tools.”

Although the privately held company doesn’t disclose financial results, Leibert told Business Insider last November that revenues were running at a $50 million annual clip. And today it said it has tripled revenue from a year ago as of May.

Asked if an IPO might be in the plans sooner or later, as it sometimes is for companies raising a late-stage round, Leibert said the company is more focused on growing and becoming profitable for now.

Photo: SiliconANGLE

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