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The Sun Rises on the ADC Cloud

December 10, 2014

In August 1998, a young, charismatic executive named Jeff Hussey visited Menlo Ventures and spoke to us about the “load balancing” market. His company had developed a product that guaranteed “content delivery” through the improvement of website performance and increased reliability for internet content and intranet applications. His early customers included Microsoft, Exodus, Real Networks, and Alaska Airlines. The company was growing fast. The technology was unique. The partnership was impressed. Menlo decided to invest $5.5 million in a $7.7 million round (yes folks, that was considered a big round then) for roughly 10% of the company. The company’s name was F5 Labs (now F5 Networks). Today, F5 Networks is a $10 billion market cap company doing close to $1.75 billion in revenues.

In August 2014, three incredible founders (Umesh Mahajan, Murali Basavaiah, and Ranga Rajagopalan) walked through our doors to talk about the “Application Delivery Controller” (ADC) market. The current solutions in the ADC market from folks like Citrix and F5 (yes, that F5) are failing customers. Large cloud service providers such as Amazon, Facebook, and Google are abandoning their expensive fleets of proprietary appliances and are instead developing their own analytics-driven, scale out layers of software-defined infrastructure. Most enterprises do not have the luxury of the capital or the engineering resources to do the same. Enter Avi Networks.

Avi (which means “sun” in Sanskrit) wowed us with their technology, but we wanted to dig more. We spoke to analysts. We spoke to F500 customers piloting their software and we spoke to our contacts in the industry. All of them confirmed that the current solutions are not architected for the cloud, the Avi Networks Cloud Application Delivery Platform rocks and that these founders, who have built products that generate over $2 billion in revenues for Cisco and run in 80% of datacenters worldwide, are the real deal. They are Menlo kind of people. We experienced the same feeling we had working with Jeff and team 16 years ago. We are thrilled to be one of Avi Network’s investors along with Greylock and Lightspeed.

The sun is rising on the ADC cloud.