Jan 18, 2021

Spotlight: Volterra, F5's $500mn multi cloud purchase

edge computing
Harry Menear
3 min
F5 Networks paid a cool half billion for Californian app security as a service startup Volterra earlier this month
F5 Networks paid a cool half billion for Californian app security as a service startup Volterra earlier this month...

Networking company F5 announced earlier this month that it had paid $500mn to purchase privately owned app security-as-a-service startup Volterra from its founders.

F5, which largely works behind the scenes to support apps like Netflix and Disney+, has been working over the past few years to shift its business model from hardware to software sales. Currently, about 35% of the company’s revenue stems from software, compared to just 10% in 2018. In a recent interview, François Locoh-Donou, F5’s CEO, said that the company’s board is looking to grow that number to 75% in coming years. 

Volterra is F5’s third major acquisition in as many years. The companies currently have more than 50% overlap between their customer bases. The deal is seeing F5 pay $400mn in cash, with an additional $60mn in deferred stock to the startup’s founders and employees. 

This week, we’re taking a look at Volterra, and exploring why F5 has calmly handed over almost half a billion dollars for a company that isn’t projected to have any positive impact on its balance sheet this year. 

“We’re not acquiring Volterra for what it’s going to do for us today, meaning what it’s going to do for revenue in the 2021 financial year,” Locoh-Donou said in an interview. “We are really acquiring Volterra because it transforms our competitive position.” 

If you can't beat them, buy them

Founded in 2017, Volterra is based in Santa Clara, California. The startup emerged from stealth mode in 2019 with a $50mn Series A funding round. Volterra - which is funded by Khosla Ventures, Mayfield and Microsoft M12 Ventures - focuses on edge computing and delivering multi-cloud security as a service for applications. 

In a recent blog post announcing the acquisition, Volterra CEO Ankur Singla noted that the COVID-19 crisis has dramatically accelerated the company’s pace of innovation, in addition to the demand from the market. 

“COVID-19 has dramatically changed the landscape — it has accelerated digitization of physical experiences and moved more of our day-to-day activities online,” he wrote. 

“This is causing massive spikes in global Internet traffic while creating new attack vectors that impact the security and availability of our increasing set of daily apps.” 

Volterra’s platform delivers app security as a service, helping its customers distribute their sensitive data and app hosting information across multiple cloud providers while also improving uptime through advanced edge security. 

Singla added that F5, with its capabilities combined with Volterra’ platform, will be able to better compete with its direct rivals, like Cloudflare and Fastly. In an interview, Locoh-Donou added that F5 initially tried to build its own version of Volterra’s service, before electing to buy the startup instead. 

The acquisition has been ratified by the board of both companies and is expected to close by the end of March 2021. 

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Jun 22, 2021

Cologix invests in hybrid cloud connectivity across Canada 

2 min
In response to rapid interconnection growth, Canadian data centre operator Cologix is investing in two facilities in Vancouver and Toronto. 

Canadian and US data centre operator Cologix is investing in two data centres in Canada, in response to “record growth in interconnection in Canada,” reportedly due to “accelerated customer demand to access clouds, software, networks and other key stakeholders at the edge.” 

In order to meet this increased demand for interconnection to support public and hybrid cloud services, Cologix has invested an undisclosed sum to acquire an interconnection facility from Zayo Group Holdings in Vancouver, and add a further 10 MW of IT capacity to its existing hyperscale facility in Toronto. 

Cologix's CEO, Bill Fathers, noted that “We continue to invest in deep connectivity and scale in Canada in response to accelerated demand for cloud deployments at the network edge,” adding that Cologix currently hosts 75% of Canada’s direct cloud onramps in its data centres, as well as providing its customers “access to thousands of miles of dark fiber routes in the provinces of British Columbia, Quebec and Ontario.” 

Fathers also emphasised the fact that “This site acquisition in the heart of downtown Vancouver, where data centre space is in short supply, fits into Cologix's interconnection growth strategy by continuing to expand our Canadian footprint to support edge cloud traffic growth."

Located in downtown Vancouver, the new site purchased from Zayo Group Holdings is located at 175 West Cordova Street. The site comprises more than 65,000 square feet of real estate, and Cologix plans to begin expanding the facility immediately, adding an additional 4.2 MW of capacity in the coming year. 

Cologix’s Toronto data centre TOR4, is connected to an extensive dark fibre network which adjoins it to the company’s largest data centre in the city, TOR1. The newly announced expansion will add a further 10 MW of capacity to the site, as well as expand its total floorspace by approximately 50,000 square feet. 

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