SD-WAN provider CloudGenix raised $65 million in a Series C funding round, bringing its total funding close to $100 million. The round included existing vendors Bain Capital Ventures, Charles River Ventures, Mayfield Fund, and Intel, as well as new investor ClearSky Ventures.
CloudGenix CEO Kumar Ramachandran said that the company would use the new funding to expand and increase its sales and go-to-market strategy, which includes building its channel and partner ecosystems and growing its global footprint.
The SD-WAN provider currently has offices in San Jose, California; Raleigh, North Carolina; and India. According to Ramachandran, it is looking to open an office in Europe and some segments of business within the Asia-Pacific region.
In a recent IHS Markit report, the research firm reported that CloudGenix brought in $3.6 million in revenue in the fourth quarter of 2018. This is a 20% increase quarter over quarter and a 44% increase year over year. But Ramachandran says the report understated his company’s revenues and bookings by about 15 to 20 times.
CloudGenix takes an application-centric approach to its SD-WAN, including a top-down enforcement of WAN policy for performance, security, and compliance. It identifies applications using fine-grained application detection. This is not just based on packets like some SD-WANs, but it also looks at application signatures, fingerprints, and requests made. This allows users to define business policies based on the specific application and its use, not just the protocol.
In addition to this application-centric approach, it stores all of the application data — including performance metrics, application metrics, network statistics, and metadata on every flow — in a data lake in its cloud. And, it relies on data science techniques and machine learning (ML) to establish baseline application and network behavior and auto correct when needed.
This approach, Ramachandran says, is allowing the company to take on “incumbent legacy vendors,” such as Cisco. “More often than not, Cisco is the incumbent vendor. So we go up against them and others, and we come out on top because of our product differentiation and the kind of capabilities that we’re able to deliver to our customers,” he said.
CloudGenix claims a 90% win-rate over legacy vendors and other SD-WAN products when compared in enterprise proof-of-concepts (PoCs).
A Different Approach for Infrastructure Services
One of the ways it is taking on incumbent vendors is by using a different approach to security and other infrastructure services, says Ramachandran.
Rather than deploying these infrastructure services — which include voice, operational, and cloud-connecting capabilities — as separate appliances or as virtual network functions (VNFs), CloudGenix’s SD-WAN enables enterprises to cloud-deliver these services. It is calling this method “cloud blades.”
“What we are seeing with customers is that SD-WAN is a foundational capability, but customers also do need a platform at the branch which allows for the delivery of, not only the network with SD-WAN, but also for the delivery of security, voice, some operational capabilities, et cetera sitting at the branch office.” Ramachandran said.
Typically, he noted that when traditional vendors add cloud-based security options, customers lose active-active connections: “one of the foundational selling points of SD-WAN.” But, because CloudGenix is also an internet-facing SD-WAN, it can maintain this active-active connection.
Customers can also maintain control and policy in the cloud for enforcement at the branch, he says. With this method, CloudGenix is automating the WAN, allowing customers to specify application policies, and allow the infrastructure to organize itself based on specifications.
Some of the cloud-delivered security providers that CloudGenix partners with include Palo Alto Networks, zScaler, and Symantec. It also has partnerships with unified Communications-as-a-Service (uCaaS) providers Microsoft, RingCentral, and Fuse; cloud providers Amazon Web Services (AWS) and Microsoft Azure; and operation tool venders PagerDuty and ServiceNow.
Going forward, “I think you’ll see us very aggressively come to market with the cloud-based platform,” said Ramachandran. “We think Cisco’s IOS has more than floundered, and so we have an opportunity to take the infrastructure stack to the cloud. And we see customers who are deploying cloud blades — even when they have, say, Cisco’s SD-WAN solution, it only integrates with Cisco services and the Cisco Umbrella. So the customer still needs a platform that allows for the cloud-delivery of infrastructure services.”