As devices like your car, refrigerator or even your mattress start transmitting data, a Triangle software company believes it can lead globally in filing, storing and managing all of those bits of information in a fast and easy way.
Will VC Make RTP’s Zaloni the Go-To for Fortune 500 Data Management?
The company is Zaloni, and though it’s already created custom data management solutions for 100 Fortune 500 customers since 2007, it’s still very much a startup. Over the past two years, the team of 180 Zaloni workers in RTP, San Francisco and India have transitioned from a custom solutions consultancy to a product company on the leading edge of Hadoop adoption and integration.
Last week marked the beginning of Zaloni’s first fundraising effort. In front of a crowd of investors at the CED Tech Venture Conference, vice president of marketing Kelly Hopkins Schupp revealed a tested and perfected product called Bedrock as well as plans to raise growth capital to finally scale Zaloni.
“We think it’s great timing to raise money. It’s a great time to be this product,” she told me in an interview before the conference. The Hadoop marketplace is projected to hit $50 billion by 2020, and according to Schupp, Zaloni is the only provider of a data management platform for Hadoop that covers “the full data pipeline.”
If you’re not in the software development world, you may not be familiar with Hadoop. It’s probably best compared to Linux. What Linux is to operating systems, Hadoop is to data.
Founded in 2005 by a Yahoo engineer and a University of Washington graduate student, Hadoop began with a mission to index and quickly search the entire Internet. As the pair worked to make that happen faster and without complexity, they developed an open source software framework used for distributing the storage and processing of large data sets. It’s an alternative to storing data on traditional servers which quickly fill up and/or could fail at any point. The software stores data in multiple locations and automatically repopulates any data lost if hardware malfunctions. It also collects processing power from all of these “nodes” to call data sets much faster than traditionally.
Though Hadoop is open source, companies were built to implement it within large corporations. Like Red Hat is to Linux, Cloudera, Hortonworks, IBM and others are to Hadoop. But one thing those organizations don’t do is help companies index and make sense of the data they’re storing and processing through Hadoop.
That’s where Zaloni comes in.
Founder Ben Sharma (top left) worked for NetApp building out data management architectures for large telecommunications and other enterprises, leaving in 2009 when he saw the increases in storage and speed, and cost savings that Hadoop seemed to allow. He wanted to help companies better leverage their data and thought he could build a solution using Hadoop.
He partnered with college friend Bijoy Bora (top right), who’d spent years in Silicon Valley working for IBM and other startup technology firms.
Both East Indian, they named the company Zaloni after the word for “fishing nets” in an East Indian dialect. The idea is that you capture the big data and reel it in.
Zaloni picks up where distributors leave off by creating what’s called Hadoop “data lakes” to tag and catalogue all the data so its easily tracked over time and located when needed by an enterprise. It also meets data security and governance standards. A CIO or CTO can leverage a product like Zaloni to help lines of business find value in all the data they’re collecting and storing. Zaloni’s biggest success has come in the financial services, healthcare and telecommunications industries.
Bootstrapped, the company is profitable and has had strong growth. But the men haven’t been blind to further opportunity in the evolving space, especially as more and more data is collected in nearly every industry. It was while working with customers that they realized they were solving the same problems again and again. With 100 customers implementing Zaloni’s solutions in some way, it seemed like a good time to create a product around the most common needs, in hopes of scaling the business even faster.
In 2013, Zaloni announced a data management platform called Bedrock and the team has spent the last two years testing and fine-tuning the product with 15 or 20 clients.
They’ve already had some big successes. For Verizon, Zaloni increased storage capacity by 20 percent, improved disaster recovery, enabled big data analytics and saved $34 million over five years. Other clients include United Health Group, GE, Honda, American Express and MetLife.
They’ve also hired a chief financial officer, Schupp as vice president of marketing and promoted a vice president of global sales. But a fourth quarter fundraise will allow for a larger sales and marketing organization and continued product development. So far, only a few others in the space have raised money—Trifacta has brought in $41 million and Datameer has raised about $77 million. Neither are direct competitors to Zaloni.
Fortune 500 companies remain the target during this next phase of life for Zaloni. They’re the organizations with the most data and who are beholden to the most government compliance around it. Funding will be necessary to begin the long sales cycles typically required in that part of the market.
“Considering the growth rate and the opportunity at Zaloni, what we don’t want to do is leave opportunities on the table because we don’t have the growth round to take advantage of it,” Schupp says. “Our question now is how can we capitalize on this marketplace and do it quickly.”