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Cloud disaster-recovery startup gets pre-IPO VC cash slurp

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Security for virtualized datacentres

Ziv and Oded Kedem's latest venture, Zerto, provides hypervisor-based replication for VMware. Thanks to lashings of venture capital dollars it has been growing steadily since its stealth beginnings in 2009. The company emerged from stealth in July 2011, having started with $6 million of seed and A-round funding.

A $15 million funding boost was announced a month later in August and now, twenty months later, comes a further C-round of $13 million.

The VCs think Zerto is doing well and it now gets its pre-IPO, or pre-acquisition, funding. The round was led by RTP Ventures with existing investors Battery Ventures, Greylock IL and US Venture Partners piling in too. Total funding is now $34 million.

Zerto doubled its headcount in 2012, building up its enterprise customer count and growing a roster of more than 100 cloud service providers (it says) using its virtual replication to provide disaster recovery for the cloud. The latest cash infusion will be used to bulk out its marketing and sales infrastructure and expand its development and cloud product teams.

In a canned quote, Ziv Kedem, Zerto's founder and CEO, said:

With this additional capital and support of our investors – which shows confidence in our continued growth and success – Zerto is poised to aggressively push for even greater market adoption.

Well, yes, what's going to stop it? Zerto says its ZVR software is better than vSphere's SRM (Site Recovery Manager) and implies it's going to sell a bundle.

Memo to Dell, HP, IBM and NetApp: Zerto looks like a good little tuck-in acquisition and $150 million to $200 million should give the backing VCs a good exit and the acquirer a solid little set of software capabilities. Go on, you know it makes sense. ®

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