What's Happening at Start-Up Starboard?

Starboard Storage to Pursue Strategic Options

Starboard Storage Systems, Inc., after inquiries by strategic players, decided to pursue a new business model and focus on these opportunities.

The board of directors and the executive team believe that this is the best path to accelerate the adoption of our innovative products and technology, as well as serve the interests of our existing customers and continue to grow the customer base.

This move coincides with a new investment from our existing investors.

As a result of this strategic decision, we have restructured the business to focus on the engineering of our core intellectual property.

Starboard’s pioneering technology addresses a number of key trends in enterprise storage, specifically the unique advantages of consolidating SAN and NAS storage on a virtualized storage pool coupled with on demand application acceleration using solid state technology.

Going forward, Starboard will focus on expediting delivery of our core intellectual property while continuing to deliver excellence in technology and support to our existing customer base.

We will also continue to sell to new customers who meet our core qualification requirements.

Additionally, Starboard will be delivering a new version of the Starboard OS to our customers in Q2 that features advanced technologies, including enhanced caching algorithms, multiple write caches and cache compression, as well as many customer-led performance enhancements.

We continue to believe and exercise our commitments to hybrid storage systems, which we believe are disruptive in the market today. This category is strong and primed for high growth. We are pursuing this path to ensure that the Starboard proven products and technologies will be at the forefront of this market shift.

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One of our readers send us the following email: "Starboard Storage Systems laid off most of its employees late last week. Some engineers retained. Company said is had been approached by a would be acquirer and needed to cut costs while it shopped around looking for a better deal. Messaging sounds fishy to me."

We approached Starboard to verify the information. First the company send us the press release published above entitled "Starboard Storage to Pursue Strategic Option." Just for StorageNewsletter? This text is not currently available on its web site or on Internet.

Then we spoke with Lee Johns, VP of product management at Starboard.

Last February we published an article Start-Up's Profile: Starboard Storage Systems - With HDD/SSD system able to optimize each application. At this time the start-up said to have 34 employees. How many now? Johns didn't say there was no reduction but refused to give us the figure, apparently significant. He said his company is still alive and confirmed the restructuration of the Broomfield, CO start-up.

We have understood that the idea is to keep only its engineering team to concentrate on technology rather than to continue to sell through the channel its hybrid (HDDs and SSDs) of hybrid storage arrays for blocks and files, then probably trying to sell IPs to another company.

The firm got $13 million in Series B in February 2012 when it was born, following the closing of RELDATA, a start-up launched in 2005 and involved in unified block and file storage solutions over iSCSI, that got $4 million in series B funding in 2011 and located in Parsippany, NJ.

Starboard is supposed to announce major technological enhancements in 2Q13 with new R/W caching and compression capabilities, and is in the process to get additional financial funding and new investors as the new business model will generate less revenue.

The problem here is that there is already a lot of competitors in the new sector of HDD/SSD storage subsystems, big companies and start-ups, and it's probably easier for a storage company than for end users to understand precisely the difference between the various technologies.

First Starboard's CEO was Victor Walker, a storage veteran now COO at Parallel Scientific, being replaced by Starboard's chairman Bill Chambers, previously founder and CEO of LeftHand Networks and then VP of HP StorageWorks.

Which company could be interested in acquiring Starboard? Johns just said his company, currently without any OEMs, is "looking for partners."

Our opinion is that at least three storage giants could be potential buyers:

Dell that has no hybrid solution like the sophisticated Starboard AC Series storage system,

HP because several Starboard's executives come from LeftHand - including Chambers, Johns as well as president Tom Major -, a company in iSCSI SAN solutions sold to HP in 2008 for $360 million, and

IBM in high end SSD systems only following the acquisition of Texas Memory Systems.

What’s Happening at Start-Up Starboard?

Layoffs and restructuration

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