SEPATON Rides Data Protection to Riches

SEPATON’s data protection appliances are catching on with customers – and with VCs.

The Southborough, Mass.-based start-up announced $23.5 million in fourth-round funding this week, led by Menlo Ventures. Also participating were new investor Valhalla Partners and existing investor Jerusalem Ventures Partners (JVP).

“I think that the new funding shows that the VCs, two of which are top-tier and in already [Menlo and JVP], are behind the company’s vision and the management,” says Enterprise Storage Group analyst Peter Gerr.

SEPATON’s S2100-ES

Gerr told Enterprise Storage Forum that the appointment of Mike Worhach as CEO in September “has already helped the company sharpen its focus and improve its momentum into the market,” and the addition of Egenera CEO Bob Dutkowski to the company’s board of directors “shows that the company can attract talent.”

“They’re in a market segment — virtual tape/disk-based data protection systems — that is going to be among the hottest over the next two years,” predicts Gerr.

“Our research shows that users are accelerating their adoption of disk-based systems, especially VTL, to improve their backup process, but perhaps even more so to allow them to rapidly recover valuable data as needed,” Gerr continues. “There’s a lot of competition in this segment from start-up companies,
and increasingly, established vendors, so SEPATON will really have to aggressively grow its installed base this year to get noticed, but right now they’re looking good.”

A recent Enterprise Storage Group study on data protection found that 66% of users think backups take too long to complete, and 50% say recovery takes too long. 75% say they intend to acquire some form of disk-based backup technology over the next two years.

SEPATON — which not coincidentally is “no tapes” spelled backwards — hopes to nab its share of those customers. The start-up has 20 customers so far, and expects to close on another ten soon.

“We are impressed by the progress SEPATON has made in a short period of time,” says Adam Fisher of JVP, a SEPATON board member. “Our continued support of the company reflects our confidence in the size of the market opportunity for disk-based systems that emulate tape libraries, SEPATON’s unique file system approach, and the high-quality of SEPATON’s management team.”

“We looked at a number of companies in the backup and recovery space and concluded that SEPATON had the right architecture to deliver immediate value to its customers, while providing increased value over time through applications built on the platform,” says Pravin Vazirani of Menlo Ventures, who joined SEPATON’s board with the funding announcement.

SEPATON’s S2100-DS Virtual Tape Library System is a RAID-based solution that performs backups at up to 540 GB/hour — as much as 10 times faster than tape systems. Capacity is upgradeable from 3 TB to 6 TB in a 4U rack-mount appliance. Pricing for the S2100-DS hasn’t been released.

The S2100-ES VTL system delivers backup speeds up to 1.6 TB/hour, and scales from 3.5 TB to 200 TB. Pricing starts at $58,000.

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