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Nutanix Is Tech's Newest 'Unicorn' Raising Massive $101M Round At $1B Valuation

IntroNutanix CEO Dheeraj Pandey’s got a lot of money to play with. (Credit: Nutanix). Nutanix has reached ‘unicorn’ status in Sillicon Valley in just four years, raising a $101 million Series D funding round Tuesday led by Riverwood Capital and SAP Ventures that values the datacenter infrastructure company at about $1 billion.

Also getting into the large round were new investors Morgan Stanley Expansion Capital and Greenspring Associates along with existing investors Battery Ventures, Khosla Ventures and Lightspeed Venture Partners, bringing Nutanix’s total funding to $172.2 million to date.

CEO Dheeraj Pandey says that his company has reached the ‘unicorn’ milestone, meaning the company has been valued at $1 billion in less than ten years of existence. Nutanix accomplished the feat faster than many, just four years from launch and after just two full years of selling. ”This money and the fact we entered the unicorn club of the billion dollar valuation, customers are now aware we are not going anywhere,” Pandey says.
Nutanix is in the business of cloud datacenters, its “Virtual Computing Platform” allowing companies to store their data remotely on a flexible number of servers as it scales.The company has gained significant sales traction in eight quarters, taking in $100 million in sales to date, almost 80% of that last year. Its new valuation, technically just under $1 billion by about $50 million, Pandey hints, represents a 2.4x jump from Nutanix’s value at its last round a year and a half ago.

The plan for the funding, Nutanix says, is to now sell aggressively in competition with the old guard of data storage companies like Cisco and NetApp as well as some of tech’s biggest names. “The total addressable market is HP and Dell,” says Pandey. “We are muscling our way into the big boys’ club, and it needs money.”
Where you need big-time dollars to compete like that, says Nutanix’s marketing chief Howard Ting, is in international reach for large customers. Companies like Toyota operate in a bunch of countries today and expect their data to be easily stored nearby. Otherwise, remote storage by cloud isn’t really making the company’s life any easier. That means Nutanix has had to expand rapidly, the company says, in North America, Northern Europe, China and Japan, while entering a new market, Latin America.

By bringing in Riverwood, Pandey hopes to gain some manufacturing expertise for hardware needs for the expansion, while SAP Ventures unlocks the clout and network of SAP’s large global customer base.
But also of note is the fact that Nutanix now has the backing of two of the most popular investment banks for IPO-bound tech companies in Morgan Stanley and existing investor Goldman Sachs, and Pandey says that is no coincidence. Nutanix is one third sales year from being IPO ready, its CEO says, though he won’t be exact about his timing because “then you get mercenaries working for you.”

Pandey says that Nutanix already “basically has the numbers” to go public, but will spend 2014 proving its story with a third year of sales results before “telling our story” to the public market.
With such a large Series D round, it’s clearer than ever that big checks are flying for enterprise companies that can prove growth and solid financials in a hot area like cloud storage and data. Not many datacenter companies will find themselves needing a multi-billion dollar exit like Nutanix now does, but Pandey says that in Silicon Valley, that kind of money still talks.

“Telling the technological visions is one thing,” Pandey says. “But going in and convincing the economic buyers who write the large checks requires your own power.”
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