Cloud Stocks: Analysis Of Pure Storage’s Portworx Acquisition

Portworx’s Acquisition

During the quarter, Pure Storage announced the acquisition of California-based Portworx for $370 million. Portworx is a Kubernetes Data Services Platform providing fully integrated solutions for persistent storage, data protection, disaster recovery, data security, cross-cloud, data migrations, and automated capacity management for applications running on Kubernetes. Prior to the acquisition, it had raised $55.5 million in three rounds of funding from investors including Mayfield Fund, GE Ventures, Mubadala Capital, Ventures US, NetApp, Cisco, and Sapphire Ventures.

The acquisition will allow Pure Storage to expand its data service capabilities to traditional and cloud-native applications in containers. Portworx will continue both its software-defined storage container and Kubernetes control roadmap and layer in Pure Storage’s capabilities. Together, they will use Pure’s capabilities along with VMs and bare-metal workloads, all managed through Pure’s Saas-based Pure1 management system.

I recently interviewed the CEO of Portworx Murli Thirumale on what’s happening in the storage industry as a player like Pure Storage tries to move up the stack and acquire a startup like Portworx.

I think the merger of Pure Storage and Portworx will work very favorably for both players. The products of the two companies complement each other. All of Portworx’s customers are deploying containerized apps using data services, and now Portworx will enable Pure Storage to give their customers the ability to manage data. Pure Storage will now be able to offer data management and data services that have much more to do with software than having the underlying hardware.

At the time of the acquisition, Portworx had about 175 customers, most of them from the global 2000 list. Pure Storage has about 8,000 customers, of which a majority are classic enterprise customers compared to the mid-market. There is a high amount of leverage based on their customer base and their customer base is consuming what Portworx has. Clearly, this is a well-made match.

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