With the Arista IPO imminent, one might be wondering what’s happening with the next crop off networking vendors. The valuations of many startups the Software Defined Networking (SDN) market are rising, and financing deals are currently being done in a range of $100M to $400M, according to Rayno Report research.
Some recent key deals boosting valuations included Cumulus Networks’ financing in January, which boosted the company’s valuation beyond $300M, according to our sources. This made it one of the most valuable private networking companies. In addition, sources say a deal with Big Switch in 2013, including an investment from Intel, boosted its valuation beyond $200M. These two companies are among our leaders in the SDN Power Rankings of startups, included in the report.
Startups are building value as an SDN ecosystem takes shape and companies strike partnerships that combine SDN software with big-time hardware distribution. Some good examples of this are the distribution deals that Big Switch and Cumulus struck with Dell to put their software on Dell’s hardware to build “white box” switches. Another great example is Pluribus Networks’ deal with Super Micro to put its SDN and analytics software on standard servers.
Prior to these deals, the concept of using software-based networking on standard hardware was more speculative in nature. But deals with big, multi-billion-dollar distributor has really put SDN software into the distribution channels and has the potential to get it into the heands of big-time users.
These trends are some of many included in the SDN Revolution report, which also includes a taxonomy of SDN products, an overview of M&A strategy likely to be followed by incumbents, as well as important predictions about the future of the SDN market.