Pure Storage, an upstart maker of data storage equipment, hopes that $150 million is enough to take on a multibillion-dollar competitor.
Pure, which offers a “flash storage†product that it says can store lots of digital information on silicon cheaply and fetch it fast, announced Thursday that it had secured $150 million in new financing, mostly from T. Rowe Price, Fidelity Investments and Tiger Global Management.
It was the company’s late-stage “E†round of funding, and it valued Pure at well over $1 billion. The presence of a lot of financial firms and that substantial valuation should indicate that the company will soon go public, but Scott Dietzen, the company’s chief executive, said he was in no rush.
“The best engineering talent likes to be part of the uplift from an I.P.O.,†he said. “We want to attract a lot of great talent.â€
What is likely to happen is that Pure, as well as EMC, will start competing globally with new products that put data storage on silicon rather than traditional methods, like discs.
Fifteen months ago, EMC, which is the leader in traditional disc storage, paid about $400 million for a company called Extreme IO, which had technology similar to Pure’s. Mr. Dietzen believes there are a number of things he needs to build to be a serious, global competitor to EMC.
“We need a sales force, we need global marketing, we need 7Ã-24 global support,†he said. “We’re trying to beat a $15 billion global business in disc drive storage.â€
The costs of putting storage on silicon are likely to keep dropping, which means that, in time, it will be more affordable to expand how flash storage is used in business computer systems.
That is potentially good news for Pure, though Mr. Dietzen’s company will have to address a lot more customers and uses effectively. EMC can already do that, but every flash sale does undermine its legacy disc storage business.
Pure Storage also announced that Frank Slootman, who is the chief executive of ServiceNow, a cloud-based enterprise software company, would be joining its board. Mr. Slootman was previously chief executive of Data Domain, which was purchased by EMC in 2009 for $2.9 billion.
