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Fat Startup Delphix Growing Rapidly

Posted on Wednesday, Feb 12th 2014

According to a recent report by IDC, the global big data market is projected to grow 6 times faster than the IT market to be worth $16.1 billion this year. Within big data, the infrastructure market is expected to be the highest growing segment and will account for 45% of the market this year. Services account for 29% and software contribute 24% of the big data market.

Delphix’s Offerings

Menlo Park, California-based Delphix operates in this high-growth big data infrastructure segment and is trying to virtualize databases. Delphix was founded in 2008 by entrepreneur Jedidiah Yueh who had earlier founded and sold data de-duplication company Avamar to EMC for $165 million. His next offering, Delphix is a cloning and data virtualization offering that helps organizations get fast, flexible, and reliable access to data while ensuring costs of data management are kept to the minimum.

Delphix believes that most organizations end up managing 8 to 10 copies of a database for development, QA, reporting, and other project needs. Additionally, organizations have to spend both time and money on ensuring that the right data reaches the right teams after necessary approvals and co-ordination. Delphix reduces this effort by virtualizing Oracle and Microsoft databases that help accelerate the delivery of the right data for development, testing, and reporting needs. Not only does Delphix ensure that the Data Base Administrators are not spending hours sifting through data, but it also helps ensure that the right version of data is available for business decision making and to QA engineers for testing. Delphix helps sync data across locations and distribute it in hub and spoke configurations across clouds and data warehouses across major platforms. They claim that their product helps improve data delivery times by ten times and project efficiency by 50% for enterprise applications.

Delphix’s Financials

Customers can license Delphix by the number of CPUs in the virtual machine that they want to have access to. Today, they have several large organizations as their customers including several from the Fortune 1000 list across industries including technology, telecommunications, retail, manufacturing, consumer goods, and SaaS. Their customer list includes names like Comcast, eBay, Electronic Arts, and SAP to name a few. 50 organizations within the Fortune 500 use their services and Delphix claims that they have helped them save over $100 million in the last two years.

Their revenues are growing rapidly. In 2011, their revenues were estimated at $6 million and they grew to over $20 million by 2012. They are targeting to become a public company with revenues in excess of $1 billion in the next few years.

For now, they are venture funded with $44.5 million in venture funding from Greylock Partners, Lightspeed Venture Partners, Jafco Ventures, Summit Partners, and Battery Ventures. In fact, this company is a good example of a ‘fat startup’ founded by a successful serial entrepreneur that was concept-financed by Greylock, a top Silicon Valley venture capital firm that has a particular expertise in such deals, especially in the infrastructure space.

I spoke with Jed Yueh recently, and he mentioned that Delphix is growing much faster than his first company at a similar stage of its development. Jed did his first company in Southern California, and he believes that some of that growth is due to the more sophisticated talent pool that he has been able to attract by making the choice to do this company in the heart of Silicon Valley. Interestingly, Jed does not have a technical background. He is an English major, who learned the game of technology startups by doing them. Pretty impressive!

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