Redpanda Data Inc., the developer of a data platform that unifies historical and real-time data, today said it has raised $100 million in an over-subscribed Series C round that brings its total funding to $163 million.
The size of the bankroll is notable given the moribund state of technology markets over the past year. Also noteworthy is that all of the funding came from existing backers, including Lightspeed Venture Partners, GV Management Co. LLC and Haystack Management Co. LLC.
Redpanda said it’s coming off a banner fiscal year in which revenues grew fivefold and its workforce more than doubled, though it didn’t reveal absolute numbers. Chief Executive Alexander Gallego said his company’s business is booming because the product, which is a drop-in replacement for Apache Kafka and commercial services based on that open-source project, saves customers so much money.
“In this economy, Redpanda is a great fit because we make the CIO look great and engineers love us,” he said. “We’re delivering 600% to 800% savings and customers are talking about taking 400 workloads down to 40. There are massive economic advantages.”
Won every sale
Gallego asserted that his company has won every sales deal against commercial competitors such as Confluent Inc. for the past six months “as long as we get to have an honest conversation with the developer. When people are forced to look for alternatives, we just win,” he said.
In the 16 months since its previous funding round, Redpanda has signed on blue-chip enterprise customers like Cisco Systems Inc., Akamai Technologies Inc., Activision Blizzard Inc., Texas Instruments Inc. and Moody’s Corp. Late last year it introduced what it calls “bring your own cloud,” a fully managed cloud service that runs on a customer’s private cloud with data kept within the local environment.
Gallego said BYOC is a fundamentally different model from that of other cloud pipeline services because it doesn’t require customers to upload their data to the cloud provider. “We basically separate the control and data plane so that Redpanda lives inside the customer’s network, but they still experience a fully managed cloud,” he said.
The model has been popular with businesses in regulated industries or that are sensitive to customer data privacy, he said, noting that BYOC represented about 30% of the company’s revenue growth over the first half of this year.
Redpanda plans to invest much of the new funding in sales and marketing as well as broaden application program interface support beyond Kafka to include the Apache Iceberg open data lake format.
The company has “many years of runway” and didn’t need the funding to continue operations, the CEO said. “It’s about expanding go to market,” Gallego said.
Ultimately, he said, the company seeks to a batch processing obsolete. “I’ve been doing this for 14 years and I’ve never heard executives say they want to access a report at midnight,” he said. “Once you operationalize streaming data you never go back.”
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