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The Best Tech Startups April 20, 2009 InformationWeekanalytics.com Analytics Alerts The Best Tech Startups Contents The vendors that made our first-ever InformationWeek 2 Five Engines Of Innovation: Startup 50 list solve critical IT problems, cut costs, and Paglo, Altor, Nirvanix, Ocarina, improve operations. Our finalists address a range of busi- And Spigit 3 The Complete Startup 50 List ness technology challenges, but the biggest concentration 9 Profiles Of Other Notable of entrepreneurial energy falls into three areas: virtualiza- Startup 50 Vendors tion, cloud computing, and software as a service. Each of 43 How To Vet Startups these companies makes a strong case that now is the time to try something new, with proper vetting. InformationWeekanalytics.com Analytics Alerts Engines Of Innovation By Andrew Conry-Murray $601.8 MILLION. That’s how much venture capital has been invested in the InformationWeek Startup 50, a group of up-and-coming technology vendors chosen through a three-step process of nomination, online voting, and editorial vetting. The companies that made our list were assessed on the following criteria: innovation in technology or business model; value, delivered in lower costs, increased sales, higher productivity, or improved customer loyalty; and enter- prise readiness, meaning a product that scales and is ready for deployment. What follows is the full Startup 50 list, along with profiles of five companies from the list that represent the inno- vative ways these startups solve critical IT problems, cut costs, and improve operations. To be considered, the newbies could be no more than 5 years old. Our finalists address a range of business technology challenges, but the biggest concentration of entrepreneurial energy falls into three areas: virtualization, cloud computing, and software as a service. The inevitable shakeout that will come to those red-hot markets points to two things. One, startups can offer competitive advantage in the form of emerging technologies. And two, tech’s leading edge entails risk, as some startups won’t make it. This list narrows the field to help IT pros better assess that trade-off. Search, SaaS Unite For IT Management By Andrew Conry-Murray PAGLO Brian de Haaff,CEO THE MARKET FOR IT MANAGEMENT TOOLS is crowd- Chris Waters,CTO ed, so a startup had better bring something unique. Paglo’s Customers: Anaheim schools,GeoVario bid: combining search with software as a service to make IT Big idea: SaaS-based IT search and management easier to set up and use. management The heart of its product is the Paglo Crawler, software that an IT team can download and install on a network. Crawler discovers the network and connected assets, and reports that information to Paglo’s data center. IT administrators can then access the information from a Web browser. 2 April 20, 2009 © 2009 InformationWeek, Reproduction Prohibited InformationWeekanalytics.com Analytics Alerts That sounds a lot like Company Tech Focus Funding 0 Aerohive Networks WLAN access points $24 million standard SaaS, but Paglo 5 Agito Networks Fixed-mobile convergence $20 million search capabilities stand P Altor Networks Virtualization security $6.5 million out. In addition to dis- Appirio Cloud integration and app dev $16.7 million U covering information Arista Networks 10 Gigabit Ethernet switches Undisclosed T about a network, Paglo Aster Data Systems Data warehousing $27 million R Aternity App performance and availability $14 million Crawler creates a search- A Attivio Information access $18 million able index. IT pros can T AutoVirt Data migration and file virtualization $8.5 million query it to find informa- S Bluenog ECM and BI software $4 million BlueStripe Software Application service management $5 million tion, such as whether E Central Desktop SaaS collaboration $7 million Skype is installed on any H Cleversafe Dispersed storage and retrieval $15 million PCs on the network or T Dataupia Data warehouse appliances Undisclosed how much free disk Digital Reef Information management $20 million space is available on a Egnyte Cloud file server $2.1 million server. Many queries can Elastra Cloud application design $14.6 million Embotics Virtual machine management $4 million use plain English, Expresso SaaS Excel collaboration $4 million although complex ones FireEye Web malware security $21 million might require the soft- InstallFree App and desktop virtualization $10.2 million ware’s SQL-like language, Mi5 Networks Secure Web gateways $4 million MokaFive Desktop virtualization $18 million called PQL. Searches can Neocleus Desktop virtualization $16 million be saved and shared. Nirvanix Cloud storage $18 million Ocarina Networks Storage optimization $31 million The platform’s dash- Paglo IT search and management Undisclosed Palo Alto Networks Application-aware firewalls $64 million boards also can be used Pano Logic Desktop virtualization $24 million to monitor vital statistics ParaScale Grid storage software $11.3 million such as system memory, Pentaho Open source BI software $25 million CPU usage, and asset in- RightScale Cloud management platform $17.5 million Sailpoint Technologies Identity management software $20.5 million ventory. The crawler runs Skytap Cloud virtual software testing $6 million continuously, and dash- SnapLogic Application integration $2.5 million boards are updated auto- Spiceworks IT management software $13 million matically with fresh in- Spigit SaaS innovation management $2 million formation. E-mail or SpringCM SaaS content management $14 million 10Gen Grid management software $1.5 million Twitter alerts can be set 3Tera Public/private cloud services Undisclosed up for events such as low Truviso Data analysis and BI Undisclosed disk space or new de- Tufin Technologies Firewall management and reporting $3 million vices joining the net- uTest Crowd-source software testing $7.3 million Virtual Computer PC life-cycle management $21 million work. VKernel Virtualization management $4.6 million WorkLight Web 2.0 tools Undisclosed Paglo recently upgraded Xangati Application management $18 million its crawler to take in Xkoto Database load balancing $13 million Yammer Enterprise microblogging $5 million Cisco NetFlow data, pro- Zscaler SaaS Web security Undisclosed 3 April 20, 2009 © 2009 InformationWeek, Reproduction Prohibited InformationWeekanalytics.com Analytics Alerts viding a clearer picture of bandwidth use and interdevice communications on Cisco networks. Paglo charges $1 per device per month. There’s plenty of competition—including Splunk, which offers its own IT search tool—and Zenoss and Kace, which also target the midmarket with low-cost IT management. In addition to its competition, Paglo must get potential customers comfortable with storing sensitive network information in a startup’s data center. CEO Brian de Haaff believes this won’t be a high bar, pointing to the success of SaaS companies such as Salesforce.com, which store customer information that’s every bit as sensitive as IT system data. Virtual Firewall For VMs By Andrew Conry-Murray SERVER VIRTUALIZATION may be transforming the data ALTOR NETWORKS center, but it’s introducing a host of headaches along the way. Amir Ben-Efraim,CEO Key among them are security and visibility. Ulrich Stern,CTO Customers: Hearst,Nielsen Virtual machines on the same server can communicate with Big idea: Securing and managing virtual one another without touching the physical network, possibly machines bypassing security and monitoring controls you’ve carefully constructed. VMs also can move from one physical server to another, which may disrupt security policies if they’re moving from a more-secure to a less- secure physical host. Enter Altor Networks. Founded by Check Point Software veterans, Altor builds virtual fire- walls to control inter-VM communication and enforce security policies. Its product, Altor VF, is a virtual appliance that, when installed on a physical server, discovers the VMs on the host by communicating with VMware’s vCenter Server (formerly Virtual Center). From there, IT teams create poli- cies for each virtual machine on the host, such as restricting or allowing inter-VM communications, or routing VM traffic elsewhere, such as to an intrusion-detection system that scans traffic for attacks. Policies can also move with a VM as it travels from one physical host to an- other, though only for hosts running the Altor VF virtual appliance. In addi- Ben-Efraim faces tion to the firewall, Altor Networks offers a Web-based management console [plenty of rivals 4 April 20, 2009 © 2009 InformationWeek, Reproduction Prohibited InformationWeekanalytics.com Analytics Alerts where administrators can create policies and monitor the status of VMs controlled by firewall. It provides traffic information such as protocols in use, shows bandwidth consumption, and tracks changes to firewall policies. The company has partnerships with established security vendors, including ArcSight. For example, an Altor virtual firewall can export firewall logs to ArcSight’s security event management platform for real-time and historical analysis of security events. Altor VF is priced at $2,000 per VMware ESX hypervisor, regardless of the number of virtual machines. Virtualization security is still an immature market, so Altor has an opportunity to establish itself. But booming markets draw competition, and that’s what’s happening here. VMware ac- quired Blue Lane, which is primarily focused on intrusion detection, but which also provides inter-VM visibility. Plus, VMware has released
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