We kick-start this week’s Deal Radar with the San Mateo, CA-based data warehousing company, Greenplum. Scott Yara and Luke Lonergan merged their two independent ventures to create Greenplum in 2003. The two saw that with the rise of the Internet, companies began to collect a thousand times more data than they did just a few years ago. At the time, the database and data warehousing market was controlled by the two leading proprietary, expensive, packaged software vendors, Oracle and Teradata. Yara and Lonergan saw that though traditional software solutions were sufficient when data volumes were relatively slow-growing, companies couldn’t afford to purchase enough traditional database software to keep up with the data deluge.
They set out to create Greenplum because there was no technology on the market that would effortlessly manage and analyze terabytes (1,024 GB) of data cost-effectively. They saw that large-scale computing at a low cost was possible using commodity hardware, provided there was a way to parallelize an open source software solution. Lonergan brought his experience with supercomputers and Yara with networking to lay the foundation for a technology solution that brought together the best aspects of the existing parallel warehouse solution (Teradata) along with the best of open source and commodity hardware.
The Greenplum Database, which is based on open-source technologies, runs on inexpensive commodity hardware, and its parallel architecture relies on the principle of distributed computing. So, as data volumes grow, companies can add additional commodity servers without paying millions for new software licenses and proprietary servers. The Greenplum Database is also the only SQL-compliant database software that integrates a broad range of analytical solutions such as R and MapReduce that enable companies to analyze data directly within the Greenplum Database. This is particularly advantageous since companies like the NYSE, Fox Interactive Media and NASDAQ process terabytes of data every day, and it’s too cumbersome and time-consuming to transfer data out of the data warehouse for analysis.
In March 2009, the company introduced a new technology designed to accelerate data loading for companies dealing with exponential data growth. Its “MPP Scatter/Gather Streaming” (SG Streaming) technology allows production loading speeds of over four terabytes per hour with negligible impact on concurrent database operations.
The data warehousing and business intelligence (BI) marketplace is a $14 billion market that includes software, hardware and services where Greenplum competes with Oracle, Teradata and Netezza. The company claims to deliver its solution on low-cost commodity processors, interconnect and storage without forcing its customers to buy a proprietary appliance as do Netezza and Teradata. According to Greenplum, while Teradata is cost-effective compared to Oracle, its proprietary appliance-based solution costs 2 to 5x more than Greenplum on a terabyte-per-terabyte basis.
The Greenplum business model is to sell a software solution as a perpetual license or as a subscription on a per-node or per-terabyte basis. With Greenplum’s software-only model, customers pay only for the capacity they use, so they can add nodes for zero software cost as long as data volumes don’t increase. The company’s hardware partners also offer Greenplum-powered data warehouse appliances for a fixed, upfront cost plus annual support fees.
The company targets companies across verticals because customers are in need of solutions that are able to handle large amounts of data. But, industries that are facing a data deluge include telco, media/entertainment, financial services, retail, healthcare, transportation and insurance. The company is seeing broad adoption across industries and applications. In 2008, Greenplum doubled its customer base to over 55 customers, deploying systems for market leaders such as MySpace, LinkedIn, and The New York Stock Exchange. Telcos, including Telecom Malaysia and India’s Reliance Communications, are using Greenplum for CRM, churn management, customer analysis, call log storage, and other applications.
Greenplum has also received various accolades, including being an AlwaysOn Global 250 company, a finalist for The American Business Awards, winner of Intelligent Enterprise Magazine’s “Company to Watch” 2009 Editors’ Choice Awards, and a position in the “visionaries” quadrant in the Gartner Magic Quadrant for Data Warehouse Database Management Systems report.
Greenplum has raised $57 million in venture capital so far: a $15 million Series A from Dawntreader Ventures, EDF Ventures, Hudson Ventures and Mission Ventures in 2006; a $15 million Series B from Dawntreader Ventures, EDF Ventures, Mission Ventures and Sierra Ventures in 2007; and a $27 million Series C from Meritech Capital Partners, SAP Ventures and Sun Microsystems in 2008. Further, Comerica Bank extended a $4 million line of credit to Greenplum in 2007. While other companies faced a downturn in 2008, the company tripled bookings year-over-year in 2008 and continues to grow its business. Greenplum believes that the economic conditions favor a low-cost solution like the one it offers and anticipates an accelerating adoption rate as customers refocus their technology solutions towards low-cost.
This segment is a part in the series : Deal Radar 2009