Original URL: http://www.theregister.co.uk/2011/06/27/bluear_ipo/

Filer maker BlueArc refiles for IPO

One hundred meeellion dollars wanted

By Chris Mellor

Posted in Storage, 27th June 2011 15:26 GMT

Filer maker BlueArc has refiled for an IPO and wants to raise a hundred million bucks.

It first filed for an IPO in 2007, looking for just over $100m, but the recession struck and market conditions stopped it.

BlueArc was founded in 1998, and is on the cusp of becoming somewhat long in the tooth for a start-up. It sells hardware-accelerated filers to business and has a reselling deal with Hitachi Data Systems.

The company says it has more than 750 customers who have bought more than 2,000 systems.

The company has not made a profit for the past eight years, making a loss of $9.4m on revenues of $85.6m in the year ending 29 January 2011. However it claimed it had record revenues in the fourth quarter of that year and made a profit for the first time in its history. There was a loss of $15.7m in the preceding year.

It is not forecasting when it will be profitable, nor is it proposing to pay a dividend, and investors will be buying the shares to gamble on their growth.

The IPO income will be used for product range expansion, research and development, and working capital. It needs the cash because it makes hardware and has to develop its field-programmable gate arrays (FPGA) to keep its filer's scalability and I/O responsiveness ahead of the competition such as EMC and NetApp.

The company is also working on using Permabit's Albireo deduplication technology, said not to impact its host system's I/O performance.

The competitive environment has become harsher for BlueArc as there are other ways to accelerate filer I/O and increase scalability.

Isilon, recently bought by EMC, and Panasas, for example, cluster filer nodes together using a fast interconnect and have targeted high-performance computing (HPC) and video processing-type applications. Avere and Alacritech front-end filers with multi-tiered accelerator appliances featuring solid state storage, and SolidAccess provides flash-based filers.

The HPC-style of computing is spreading into mainstream enterprise IT as big data applications develop, storing and analysing vast growing silos of unstructured data. The need for sheer filer I/O speed is looking to become met by flash storage, and it is possible that BlueArc has to respond to that.

Were it not for the downturn it is likely that BlueArc would now be trading as a public company. As it is BlueArc has not yet achieved escape velocity to free itself from its venture capital backers.

This IPO sees it being trundled out to the launchpad for a second attempt. Let's hope the market weather forecast is better than in 2007. ®