Building Fat Startups: Nasuni CEO Andres Rodriguez (Part 4)

Sramana Mitra: What happened next in your history?

Andres Rodriguez: After we sold Archivas, we had all the top venture capitalist wanting to fund the next project.

Sramana Mitra: I’m sure. What’s good with being an entrepreneur is, capital follows you.

Andres Rodriguez: Success breeds capital.

Sramana Mitra: However, let’s talk about the investment pieces that you explained to the investors? What year was this when you started on Nasuni?

Andres Rodriguez: This was in 2009. My pitch was very simple. I said that storage is very expensive in the data center. The enterprise pays a lot of money for storage. It’s not just storage; it’s the storage as the backup that is asked to recover and replicate. All of that adds to the cost of storage. What if I can go back to the customers and say, “For a fraction of the cost of any one of those systems, I can give you all of those systems together in an integrated system and you don’t have to bother running it because I’m running it for you.”

Sramana Mitra: Storage data service is not an entirely new concept. There are quite large competitors in that space – cloud storage as it has come to be known. I’m more interested in going back to the time when you were starting Nasuni. What was the competitive landscape like? What was your analysis of that competitive landscape that allowed you to convince your investors that this was a great opportunity?

Andres Rodriguez: It’s exactly what you just said. It’s easy to confuse cloud storage, with enterprise plus storage as service. If you look at what Amazon is trying to do, it’s very basic storage. It’s great if you want to do backup for consumer drives. If we think of that as the new hard drive, it’s a component that isn’t like anything we’ve had before that is available to us to design storage controllers. We’re going to rebuild and re-architect the storage controller so they can natively use cloud storage.

If we do so, we end up with a storage controller that is in every way compatible with what exists in the data center today – from performance, protocols to security. It’ll have these three wonderful properties. It’ll have unlimited scale. You won’t need to backup. It will be able to move or synchronize data globally in a way that is not possible today. Those three things are really valuable to enterprise customers and is something I know because I’ve worked enough with enterprise customers to know what their major headaches are.

Nasuni is the distribution system. In the past, companies like EMC partnered with hard drive manufacturers companies like Seagate. They use the hard drive as a component. Nasuni has the same relationship with Amazon and Microsoft and any cloud storage company. We see them as suppliers of hard drives. It just happens that the hard drives are spinning while they’re available in the cloud. Everything else we do is about componentizing that and building a system that you can put in your data center. That is very valuable.

The enterprise storage market is an $80 billion today. That includes primary storage, data protection, and replications tools. If you can take an industry like that and give them a much lower cost and a much simpler model of delivering essentially the same thing, you’re not trying to make a market. You’re essentially taking away from a market and converting it into this new model.

Sramana Mitra: Where there are existing budgets and everything, you’re modernizing.

Andres Rodriguez: Exactly. This is exactly why the Mini was so lethal to the Mainframe, and the PC to the Mini. Those markets existed. The mainframe preceded and created the market that the Minicomputer exploited. In turn, Minicomputer created the market that the PC then exploited. That gave those companies a huge trajectory for growth.

This segment is part 4 in the series : Building Fat Startups: Nasuni CEO Andres Rodriguez
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