HPE, Microsoft Invest in Data Center Startup Mesosphere

The announcement comes day after another startup, Stratoscale, announces its own round of financing that includes chip maker Qualcomm.

cloud investment

Data center software startups Mesosphere and Stratoscale are getting significant financial boosts from major tech players.

Mesosphere takes a container view of the data center, offering its Data Center Operating System (DCOS) as a way to enable enterprises to more easily install applications within their large facilities. Company officials on March 24 announced $73.5 million in Series C funding, with both Microsoft and Hewlett Packard Enterprise (HPE) participating. The new round of funding brings the total amount Mesosphere has raised in the past couple of years to $126 million.

Mesosphere's announcement comes a day after officials at Stratoscale, whose hardware-agnostic hyperconverged Symphony software platform enables businesses to manage their x86 servers as a single cloud-based pool of infrastructure resources, said that the company had raised $27 million in Series C financing from, among other players, Qualcomm Ventures, the investment arm of the world's largest mobile chip maker. Previous investors have included Cisco Investments, Intel Capital and SanDisk Ventures.

In total, Stratoscale has raised more than $70 million over the past three years.

The interest in the startups and investments by such big-name vendors are indicative of the drive toward software-defined data center infrastructures that are more agile, flexible and scalable, enabling them to be easier to manage and more responsive to the rapid changes being brought about by such trends as mobile computing, big data analytics, the Internet of things (IoT) and the cloud.

Also participating in the recent round of funding for Mesosphere were previous investors Andreessen Horowitz, Khosla Ventures and Fuel Capital and newcomers A Capital and Triangle Peak Partners.

"Enterprises are demanding highly-automated cloud architectures and the modern applications that run on them, so they'll need a suite of technologies specifically designed to enable this new era of computing in production and at scale," Mesosphere Senior Research Analyst Derrick Harris wrote in a post on the company blog. "Our technology, back by support from strategic partners, is the best way to help them get there."

Along with the funding, Mesosphere officials also announced version 1.0 of Marathon, the company's production-grade container orchestration service that is standard in DCOS, and a new product called Velocity. Velocity is a continuous integration/continuous development (CI/CD) platform that uses the open-source Jenkins automation service, combining it with the Marathon platform.

Mesosphere, which launched DCOS last year, also offers Infinity, a big data and real-time analytics platform that leverages such open-source services as Spark, Cassandra and Kafka to enable businesses to build and use enterprise-level analytics.

Given the focus both HPE (with its Helion cloud platform) and Microsoft (with the Azure cloud) are putting on the cloud and cloud infrastructures, their investment in Mesosphere is not surprising. Microsoft reportedly was interested in acquiring Mesosphere last year for $150 million, but Mesosphere officials declined. Microsoft last year brought DCOS to the Azure cloud, according to Mesosphere's Harris. Through DCOS, the startup has brought such components as Apache Mesos and Marathon to the Azure Container Service, and the Mesosphere technology is available on Linux and Windows Server.

"It's a great example of how the DCOS can empower both startups and enterprises to reshape IT operations for decades to come," Harris wrote.

Stratoscale officials said they are looking to use the latest round of financing from Qualcomm and others to accelerate the company's growth in the market and expand operations.

"Today's data center managers are looking to Stratoscale to help them more effectively manage their technology infrastructure," Stratoscale CEO Ariel Maislos said in a statement. "We continue to deliver on the promise of what data centers should be without the burden of being locked into legacy infrastructure that doesn't grow with your business."

The company's Symphony software-defined data center (SDDC) software enables businesses to converge the compute, storage and networking in their environments through automation and software. IT staffs are able to manage the resources as a single entity, giving them an infrastructure that is easy to manage, scalable, agile and dynamic. The platform is based on such open-source resources as Linux, OpenStack, Docker and KVM, and the API layer gives developers control over the infrastructure that their applications are running on, officials said.