"SW-defined networks" increases VC investment spurred by large sales deals

Integral service around a transaction
BY : Diego GutiérrezJuly Tue, 2013

private equityAccording to CB Insight, large sales transactions in the "Software Defined Networking" sector stimulate 416M$ of investment by the Venture Capital. Activity increased by 75% year-on-year supported by large acquisitions by Juniper Networks and VMWare and the public offering of Cyan.

Software-defined networking (SDN) gives network administrators the ability to configure and maintain networks using centralised software rather than having to manually execute commands on hardware. And venture capitalists are increasingly betting that SDN will have a lasting impact on IT infrastructure.

416$M of investment raised in 35 operations in the last year

From Q3'12 to Q2'13, 35 SDN-related startups have raised almost $ 416M. Year-on-year growth according to the figures for number of deals over the last two years has increased by 75%, while funding has marked almost 45%. Last quarter, 10 SDN financings took place in companies such as  MidokuraNetSocket and Netronome Systems with capital backed by Intel.

2.26bn$ for only 6 sales operations

The upturn in funding within the SDN ecosystem has been spurred by several large exits such as Nicira Networks (acquired by VMWare), Estela Systems (acquired by Juniper Networks) and Cian (went public). In fact, six SDN-related companies saw $ 2.26b in exit value according to disclosed data accumulated over the past two years, which is more than 320% than the $ 704M in total funding for SDN startups.


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