back to article Array upstart Violin peeks at PCIe cards, goes all in with $172m IPO bid

Storage upstart Violin Memory has publicly filed for an IPO and is seeking $172.5m. The maker of all-flash arrays has handed in its S-1 homework to financial watchdog the SEC; the document reveals it has consistently made losses while revenues have grown over the past three years. Violin Memory year on year ... Sales rising (yes …

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Silver badge

I'd be interested in seeing their ex-HP numbers

I doubt they can break out what they have spent all-in on the hp relationship, but it would be interesting to see the numbers. Otherwise, their numbers indicate that A) they will need to get to about $350m in revenues to break even, and B) that level of sales is several years away.

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Anonymous Coward

Consistent losses?

We're tired of just losing our money. Join in! Buy our stock and then we can lose yours as well.

If they can't make money as a private company, how does floating stock help beyond a short term cash infusion?

Pass.

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Bronze badge

tough road ahead

Sad to see how cut throat the SSD market is, so many players making major losses trying to build market share simultaneously... seems like it will end badly for most, perhaps all of them.

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Anonymous Coward

Get Rich or Die Tryin' ?

A lot of the smaller flash vendors look to have business plans along the lines of "Get Bought or Die Tryin' ".

Unfortunately, there don't appear to be many buyers left.... I'm very glad that I don't have any of my own money gambled on who might get acquired as it looks like more will go under than survive medium/long term.

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Angel

Desperation

Obviously not now financable in a private round any more given the huge amounts in already (is it over $250M?), one last Hail Mary in the public market. My crystal ball a lot of investor tears no more than one month after an IPO, if it ever gets out.

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This is a stunning and damning admission:

We have devoted a significant amount of resources to developing and marketing our Velocity PCIe Flash Memory Cards and believe our future growth will substantially depend on the market acceptance and adoption of this new product. Because we are strategically targeting the PCIe memory card market and expending a considerable amount of resources in doing so, if our Velocity PCIe Flash Memory Cards do not gain market acceptance, our results of operations, business and prospects would be materially and adversely affected.

They are saying that the array business can't sustain them? That they need PCIe success to stay alive?

What am I missing here?

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Anonymous Coward

Customer value proposition stands up

There is a clear and increasing requirement for this class of technology. While customer adoption hasn't accelerated quite as quickly as Violin might have forecast - or Headcount costed into their P&L - I don't see any other vendor in it's space offering more. This is exciting hardware, a wholly new market and the use case and applications for this technology are changing very quickly

Violin's S1 is interesting - in so far as it declares where they are today and forces transparency around their business model. Three things stand out from the filing for me (1) They need to invest much more deeply in ecosystem plays to recover the opportunity they lost with HP - Fujitsu looks interesting and they need to find and work through others like Cisco to similar scale (2) Fix EMEA with a new leadership team that understands partner led business and can rebuild trust with the re-seller and SI communities. I would note a new leader has been appointed to do just this and that it will take time and a lot of heavy lifting to address the channel piece pan EMEA (3) Align value with the Applications that people run their business from and sell to this audience effectively. Recent hires from VMWARE, working with the Microsoft ecosystem, really driving the SAP opportunities home all look like strong next steps within their grasp

They have taken miss-steps along the path in terms of GTM in EMEA, managing HP and leadership choices but I don't doubt their ability to get this technology into the hands of customers and build a sustainable, profitable business. It's still early days and way too early for the negative comments above. I don't see anyone else with a more credible story than Violin's right now or a better choice of Technology investor than Toshiba

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Anonymous Coward

Playing "Violin" on the Titanic?

Wow, they are REALLY burning through cash! They have been around for 8+ years and are clearly years away from making a penny. Relying on PCIe cards to save them is absurd as this market is heading to commodity. There will be minimal money to make in the PCIe market, especially when they are so late to market. Having worked at many IT product start-ups over the years, it's not very hard to win customers when you spend massive sums of cash. Half of winning sales is just showing up before your competitors. Hire enough overpaid sales guys and you will win new accounts, but not have a sustainable business. With the egos of their senior management team, a terrible business model, and increasing competitor from the incumbent "big boys", I don't foresee success for Violin. Buyer beware on this IPO.

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