Pivot3 gets kudos in WSJ ranking

Serverless storage company Pivot3 has been selected by the Wall Street as a “top venture backed company” in the newpaper's “Next Big Thing” ranking.

Pivot ranked 37th out of 5,740 companies that were considered.

To be eligible for the ranking, a company must have raised an equity round in the past three years and have a valuation of $1 billion or less.

The company's ranking “is determined through analysis of the track record of the company's founders and management, and investors on its board. It also evaluates the amount of capital raised in the last three years and the percentage change in a company's valuation in the last year. Wall Street Journal and Dow Jones VentureWire reporters and editors also provide perspective and expertise,” according to the WSJ press release.

According to a release, Pivot3 raised more than $78 million in venture capital since its founding in 2003.

Last month, Lee Caswell, Pivot3 co-founder and chief marketing officer, told me that the company (which doesn't publicly release its financials) doubled its revenue for the fourth year in a row. “IMS [Research] says we're now number one of the IP SAN products for the surveillance industry ... And IMS predicts IP SANs will be the fastest growing segment of the storage market for video security, growing at 97 percent year over year,” he said.

I spoke to Lee Caswell yesterday and will have more in a story later, but he told me that Pivot3 completed the process with the WSJ about a month ago, and that Pivot3 is the only video surveillance company on the list. The recognition obviously “gives the company a big boost in the visibility,” he said.

“It has a real impact for us,” he said. “The readers of the Wall Street Journal have not been our customers to date, and yet, the technology has applications to those customers who are looking at next-generation [uses of the technology] like virtual desktops ... which apply across all verticals like financial services and K-12.”

The barrier to entry for having something that's “unique and disruptive in the storage area is very, very high,” he said. And if you can do something different, “it's extremely valuable.”

For the most part, the investors have been “siloed, in that some understand storage and some understand servers.”

Storage, he said is a $20 billion business and the server market is a $25 billion business. “If you put then together and [can pull value from both sides, that's something that interests investors.]”

Last month I reported on a new deal Pivot3 has with Dell where Dell hardware will be combined with Pivot3's software and branded under Pivot3.

From the release: “Venture capitalists are always looking for companies with a new idea that will prove powerful enough to explode into the marketplace,” said Alan Murray, deputy managing editor of The Wall Street Journal. “The Next Big Thing highlights companies that we believe are worth watching and have a chance to make waves in their industry.”

And in a prepared statement, Bob Fernander, Pivot3 CEO said the “recognition demonstrates the market potential of Pivot3's scale-out application platform innovation, which is poised to reverse the 20-year trend of separating servers and storage,” said “Virtualization creates the unique opportunity to re-join server and storage resources in a single scale-out platform to simplify virtual deployments while saving power, cost and rack space.”

Here's the release.