Leveraging Amazon To Build a Cloud Storage Business: Nelson Nahum, CEO of Zadara Storage (Part 1)

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Nelson has built an interesting enterprise storage company and one of his key strategic moves was an unusual deal with Amazon.

Sramana Mitra: Let’s start at the very beginning of your story. Where are you from? Where were you born, raised, and in what kind of background?

Nelson Nahum: I was born in Uruguay. I immigrated to Israel to study in college. Back in the 80s, Uruguay was governed by junta. It was not very nice to stay there. Me and my brother moved to Israel with little money to study engineering. I got accepted into the university. The first thing that I liked in Israel was the freedom that everybody had. It was totally new for me because I grew up in a dictatorship kind of environment.

Sramana Mitra: What did you study?

Nelson Nahum: Engineering. First of all, I studied Hebrew. After a few months, I got accepted into an engineering school in Technion University.

Sramana Mitra: What did you do after college?

Nelson Nahum: During college, I married my wife who was also from Technion and was also from Uruguay. I started working in one of the companies in Israel as an engineer.

Sramana Mitra: What kind of company and how long did you stay with the company?

Nelson Nahum: First, I worked for a small startup for one year. This startup was far away from where I lived. Then I moved to another company. They did data storage. I started as an engineer writing software for storage. I worked there for seven years. This particular company, at the end, was shrinking. They decided to spin off my storage project to a new company. This is how I became an entrepreneur. I became co-founder and CTO.

Sramana Mitra: What year was the spin-off?

Nelson Nahum: 1999.

Sramana Mitra: Did the storage product have customers already?

Nelson Nahum: It started to have customers. It was doing well. Despite the fact that my former company was shrinking, they had decided to keep the storage project. It was their most innovative one.

Sramana Mitra: What kind of resources did you have in that company? Was there significant revenue?

Nelson Nahum: This company was very big so the revenues that the storage product was providing was insignificant. In all our products, the previous products were all legacy and obsolete. This is why they decided to close the company and create a new company dedicated to the storage product. The initial team was very small – 11 people in the new company.

Sramana Mitra: How did you sustain the 11-people company?

Nelson Nahum: The company that we spun off decided to put some money aside to sustain the 11 people at the beginning. I was CTO back then. Our CEO raised additional money and that was how we became an independent company.

Sramana Mitra: Tell me more about the early financing round.

Nelson Nahum: The first money came from this particular company. The second was from traditional VCs. The team was extremely good, especially in storage. Since we had traction with early customers, we got quite a lot of money from VCs. Cisco was one of the investors in the company. In total, we raised close to $40 million. In 2006, the company was acquired by LSI. We already had close to 80 people and had worldwide customers.

This segment is part 1 in the series : Leveraging Amazon To Build a Cloud Storage Business: Nelson Nahum, CEO of Zadara Storage
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