Microsoft buys Avere to boost its hybrid cloud strategy; start-up counted Google among investors

Key Points
  • In addition to storage hardware, Avere offers software for interoperating with the Amazon and Google clouds while keeping data on premises.
  • Avere's investors include Google and Western Digital Capital.
Microsoft CEO Satya Nadella at a company event in New York in May 2017.
Source: Jason DeCrow, AP Images | Microsoft

Microsoft on Wednesday announced that it has acquired Avere Systems, a start-up specializing in data storage. The technology could ultimately help Microsoft pick up more Azure revenue by serving customers who want to use cloud computing while still keeping data in their own facilities.

Terms of the deal weren't disclosed.

Avere offers hardware for storing data in data centers, but the acquisition seems more about strengthening and increasing the use of Microsoft's Azure public cloud. The technology lets companies use remote computing resources while keeping their data in place, and it can ease the migration of data to public clouds as well.

Avere offers tools for working with Microsoft's top two cloud competitors, Amazon Web Services and the Google Cloud Platform. Avere said it would bring its tools to Azure in 2015, but today the company's website primarily advertises its integrations with the Amazon and Google clouds.

"We are excited to welcome Avere to Microsoft, and look forward to the impact their technology and the team will have on Azure and the customer experience," Jason Zander, corporate vice president of Azure at Microsoft, wrote in a blog post.

Overall, Microsoft has taken more of a hybrid approach than Amazon or Google in the cloud business. It offers the Azure Stack private cloud software that mirrors what's available from the Azure public cloud. And Microsoft continues to sell server and database software for corporate data centers.

"Over the years, Microsoft has made significant investments to provide its customers with the most flexible, secure and scalable storage solutions in the marketplace and has made Azure the natural home for enterprise applications. This shared focus on large enterprise applications makes Microsoft a great fit for Avere," Avere CEO Ron Bianchini, a former vice president of storage hardware company , wrote in a blog post.

Google, the main business unit of Alphabet, made a rare direct investment in Avere last year. (Most Alphabet investments come through its venture arms.) Other investors include Western Digital Capital, Menlo Ventures, Norwest Venture Partners, Lightspeed Venture Partners and Tenaya Capital. In total Avere raised $97 million.

Avere was founded in 2008 and is based in Pittsburgh. Its customers include Johns Hopkins University, Sony Pictures' Imageworks and the Library of Congress.