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Pivotal Riding High on PaaS Growth

Posted on Thursday, Jan 23rd 2014

Cloud computing is expected to be the big driving force in IT spending in the coming years. In fact, it already is. According to a Gartner report, cloud computing will account for the bulk of new IT spending by 2016. Gartner estimates that nearly half of large enterprises will have hybrid cloud deployments by the end of 2017. In another report, IDC maintains a similar understanding. IDC expects global spend on cloud computing to exceed $100 billion in 2014. Within the market, they also predict that companies will start shifting their interests from Infrastructure-as-a-Service (IaaS) offerings to Platform-as-a-Service (PaaS).

Pivotal’s Offerings

Pivotal was founded in 2013 when EMC and VMW spun off their cloud computing projects into a new division. The resultant organization had the advantage of getting the technology, people and programs from both VMWare and EMC, which were already focused on big data and cloud application platforms. It was founded out of EMC’s vision of creating an offering that would enable all of its products and companies to integrate seamlessly. Pivotal aspires to deliver on that by remaining focused on a Hadoop-based stack that will help leverage off of a common file system. Their mission is to build an application suite that can leverage both the cloud and big and fast data to build a new standard for enterprise PaaS.

Pivotal’s key offering is their application and data service solution, Pivotal One which operates on their turnkey platform solution for agile development teams, PivotalCF. Through the Pivotal One application, organizations can rapidly update and scale applications on the cloud and upgrade them without experiencing any downtime.

Besides the cloud, Pivotal also offers data and analytics offerings. Their opensource applications for data include products like Pivotal HD, which is a commercial Apache Hadoop distribution-based offering to support enterprise big data analytics. It also claims to be the first native massively parallel processing SQL database that is able to connect to Hadoop. They offer analytics solutions through the Pivotal Analytics segment, which includes products such as Pivotal AX that analyzes big data in multiple input sources and formats to deliver actionable insights into trends and patterns.

Pivotal’s Financials

Pivotal’s financials are not publicly known. At the time of the spin off, 1,250 employees from both EMC and VMWare joined Pivotal. EMC owned 69% stake while VMWare bought the remaining 31% stake. Pivotal was expected to deliver $1 billion in revenues by the year 2017. Since then, Pivotal has received a total of $210 million in investments with the last round of funding held last year. In April last year, GE invested $105 million in Pivotal for a 10% stake in the company, valuing them at $1.05 billion.

Pivotal’s latest IPO plans are not known, but both EMC and VMware have confirmed that they would like to take Pivotal public.

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