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How Nutanix is Disrupting the Market for Datacenter Infrastructure and Storage August 22, 2012

Posted by ravimhatre in 2012, datacenter, Infrastructure, virtualization.
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Over the past two years we’ve seen a lot of disruption in the enterprise storage market with everything from the game-changing performance of flash to next-generation storage architectures required to support the cloud and virtualized data center environments

And notwithstanding some early wins from companies like Fusion-io, we believe the underlying data center compute,  storage and networking transformation is still in early innings of playing out.  A case in point is Nutanix, a company worth paying attention to and one where we recently led an oversubscribed growth round of financing.

So why are we so excited about Nutanix? We believe the company represents the next-generation of IT infrastructure – a CONVERGED storage and compute platform uniquely able to cost-effectively power the datacenters of today and tomorrow.

Nutanix combines enterprise-class compute and storage resources into a single, inexpensive x86 system. It also incorporates elastic scale-out technologies that have historically only been available to some of the world’s largest, and most technically sophisticated companies like Google and Facebook.  Now, for the first time, this revolutionary computing paradigm is being delivered to mid-range and large enterprises that are also looking to ride the disruptive economic wave afforded by cloud computing and large-scale virtualization.

The Nutanix magic is in its’ software which is highly sophisticated and delivers the world’s first SDS (Software-defined Storage system), similar to Nicira, also a LIghtspeed portfolio company, which built the world’s first SDN (Software Defined Network system).   The combination of SDS, inexpensive compute, and a radically simplified appliance form factor which is easy to deploy and manage has customers excited and highly engaged.  They are calling Nutanix Complete the world’s first “datacenter in a box.”

Beyond the technology, we have been hugely impressed by the team at Nutanix. We’ve had the privilege of working with them from the earliest days of the company when Lightspeed originally lead the Series A financing more than two and half years ago. The founders came to us with an extremely bold vision to redefine datacenter storage and computing and we’re incredibly excited to see how emphatically the market is now embracing this vision.

If you found this post useful, follow me at @rmtacct and follow Lightspeed at @lightspeedvp on Twitter.

Investing in Loyalty August 2, 2012

Posted by peternieh in 2012, Consumer internet, startups.
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“Customer loyalty is the single most important driver of growth and profitability. – Harvard Business Review

Today, we are excited to announce our investment in FiveStars.  Founded by Victor Ho and Matt Doka, FiveStars makes it easy, and affordable, for retailers and merchants to reward their most valuable customers.  It is the first loyalty offering that integrates directly with over 90% of existing point of sale (POS) systems and is already being used by hundreds of merchants.

So why loyalty and what makes this company and market interesting to us?

In the face of economic pressures, consumers are thinking more carefully about every purchase, and retailers now face more competition than ever.  However, smart retailers are facing these challenges and actually growing their businesses, and bottom lines, by retaining their most loyal customers.   A recent student by Harvard Business School found that a 5% increase in customer retention yields an increase in profits between 25 – 100%.

The key, however, is how to retain these customers without increasing complexity and costs.  As a former loyalty consultant at McKinsey & Company, Victor Ho has a keen understanding of the challenge that retailers face and has delivered a product that not only meets those needs, but also does it in a way that works seamlessly within their existing business structure and is frictionless for consumers to adopt.  It literally “slides in.”

FiveStars offers consumers a single card that they can use to earn rewards for everything from picking up coffee to getting a massage without the hassle of keeping track of multiple cards.  A consumer registers once by just giving their phone number and then simply provides the card to merchants on checkout.  And because the company integrates directly and easily with the POS, retailers can be up and running with FiveStars in literally minutes.  No extra equipment is required, like iPads or smartphones which add to complexity and decrease adoption.  Furthermore, Five Stars allows merchants to track spending habits and better personalize promotions and rewards.

The proof is in the pudding, and the company has already signed up several hundred merchants in its first several months of selling with very little marketing or advertising.  They have developed a winning formula and with the new capital will be looking to accelerate their go-to-market activities.

It’s a great product, built by a great team and addressing a huge market.  We couldn’t be happier to partner with them as they think big and move fast.

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