It’s no secret that software-defined wide area networking (SD-WAN) is a fast-growing part of the networking business. Enterprise customers are demanding more flexible, cloud-based options for their wide area networks.
SD-WAN offers an alternative to legacy WAN technologies like MPLS because its broadband connections can be controlled through cloud software, allowing a customer to scale up or “burst” connectivity during times of peak demand.
In fact, SD-WAN is attracting so much attention from the marketplace that research firm IDC estimates the SD-WAN technology and service market will be worth $6 billion by 2020.
Because of this potential, the SD-WAN market is attracting a lot of startups. And established companies, like networking giants Cisco, Nokia/Nuage, and Juniper all have their own variations of SD-WAN technology, too. Of course, not every newcomer will likely succeed in this fast-paced area. But here are nine firms that we think are worth watching.
For a good point of reference, check out SDxCentral’s SD-WAN/vCPE report.
Aryaka is not your average SD-WAN company. It invested in a global private network by buying Layer 2 capacity from Tier 1 and Tier 2 service providers. Aryaka’s investment resulted in its global SD-WAN service, which combines the global private network, WAN Optimization, and cloud acceleration.
Since it was founded in 2009, Aryaka has gained more than 10 million end users in more than 4,000 global sites including customers like JAS, Henny Penny, Ontex, Xactly, Invensense, and Skullcandy. But Aryaka’s customers aren’t the only ones that think highly of the company—In July, Networks Products Guide, a technology research and advisory guide, named Aryaka’s SD-WAN system a gold winner in the 11th annual 2016 IT World Awards for networking. Aryaka has raised $75 million in equity funding to date.
Founders: Ashwath Nagaraj (Cisco)
Funding: InterWest Partners, Mohr Davidow Ventures, Nexus Ventrue Partners, Presidio Ventures, Trinity Ventures
2. Versa Networks
Although the company has a strong presence in the network functions virtualization (NFV) market, it also has made some notable achievements around SD-WAN. Versa believes that by transitioning from solely MPLS to SD-WAN and software-based security, enterprises can embrace a DevOps-oriented approach, increasing IT agility.
In order to make this transition possible, Versa created a carrier-grade system for SD-WANs that runs on hardware and is programmable. Companies such as CenturyLink and EMC have integrated Versa’s technology. The company has $53.35 million in funding to date.
Founders: Kumar Mehta (Juniper), Apurva Mehta (Juniper)
Funding: Sequoia, Mayfield, Verizon Ventures
This San Jose-based SD-WAN company was founded in 2012 and allows global companies to build carrier-agnostic wide area networks (WANs). The company touts that it has 25 Fortune 500 companies as customers, including well-known carriers like Verizon and Singtel.
The Viptela platform allows enterprises to reduce WAN costs by augmenting expensive leased lines with cheaper public broadband connections. The company also says its SD-WAN technology could help the Internet of Things (IoT) space.
Viptela has raised $108.5 million in funding since it was founded, including a $75 million Series C round in May led by Redline Capital.
Founders: Khalid Raza (Hewlett-Packard, Cisco), Amir Kahn (Juniper, Cisco)
Funding: Northgate Capital, Redline Capital, Sequoia Capital
4. Silver Peak
This 12-year-old company had its feet grounded in WAN for years, and in 2015 saw the potential for SD-WAN.
When Silver Peak customers complained about the expense of MPLS connections, Silver Peak developed its SD-WAN product Unity EdgeConnect and now has more than 300 customers, including names like Wind River, San Disk, VMware, and Ebay. Unity EdgeConnect enables enterprises to reduce costs and complexity of building a WAN by leveraging both MPLS and broadband.
The company raised close to $60 million but has been self-sufficient since 2008.
Founder: David Hughes (StrataCom)
Funding: Benchmark, Duff, Ackerman and Goodrich, Greylock Partners, Pinnacle Ventures
Launched in 2012, VeloCloud claims it is the first company to deliver the three necessary components to achieve a cloud-delivered SD-WAN: a cloud network for enterprise-grade connection to a cloud; software-defined control and automation; and virtual services delivery.
VeloCloud raised $27 million in Series C funding in January led by March Capital Partners and Cisco Investments, bringing the company’s total funding to $49 million.
In 2015 VeloCloud expanded its network of vendor partners, which includes BroadSoft, Cisco, Equinix, Hewlett Packard Enterprise (HPE), Intel, and VMware.
Founders: Sanjay Uppal (OnMobile, Citrix), Steve Woo (ClearStone Venture Partners), Ajit Mayya (VMware)
Funding: Cisco Investments, March Capital Partners, New Enterprise Associates, The Fabric, Venrock
Oddly enough, Talari’s latest version of its virtual SD-WAN technology got its start because of a failed IPsec deployment. John Dickey, Talari’s president and COO, in May said his good friend tried to rip out an expensive MPLS private network in India and replace it with a site-to-site IPsec virtual private network (VPN) to help a company save money. But the bandwidth was unreliable, and the IT team had no insight as to how to solve issues when they occurred.
This incident prompted Dickey to think about using multiple service providers and adding an intelligent layer to organize the traffic. Now on its fifth-generation SD-WAN product, Talari claims what makes its technology unique is that it tags every packet in one direction for Layer 2, 3, and 4 traffic, eliminating the use of an IPsec tunnel. After four rounds of funding the company has raised $36.2 million to date.
Founders: John Dickey (AMCC), Andy Gottlieb (Aryaka)
Funding: Daybreak Investments, Four Rivers Group, Menlo Ventures, Silver Creek Ventures
Founded by a team of Cisco WAN experts, CloudGenix anticipated the SD-WAN boom back in 2014. In May of that year the company raised $9 million in Series A funding so it could pursue what it called software-defined enterprise WAN (SDEWAN), which sounds an awful lot like what we know SD-WAN to be today.
In May 2015 the SD-WAN company raised $25 million in Series B funding to help scale its product, CloudGenix ION. This product provides connectivity between the ION endpoints and the CloudGenix controller. This layer is managed by the CloudGenix controller with selective peering to interoperate with the physical carrier network.
Founders: Mani Ramasamy (Cisco Systems), Kumar Ramachandran (Cisco Systems), Venkataraman Anand (Cisco), Navneet Yadav (Cisco, Juniper)
Funding: Bain Capital Ventures, Mayfield Fund, CRV
TELoIP was founded in CEO Pat Saavedra’s basement in Toronto in 2002 with a goal of providing voice, video, and data over the Internet. The company has raised $35 million since its start 14 years ago.
Today, TELoIP sells two services: SD-Internet and SD-WAN. The products are similar, except SD-WAN adds encryption to the data plane.
The company differentiates itself from the competition by selling its technology through channel partners instead of selling directly to enterprise customers. TELoIP sells through managed service providers (MSPs), and finds this alliance to be advantageous when competing against other vendors. TELoIP works with 10 channel partners, some counting sales of over $1 billion a year.
Founder: Pat Saavedra
Funding: $30 million in private funding
9. Glue Networks
Best known as a Cisco partner, Glue Networks originally found its niche in software-defined network orchestration but has recently migrated into the SD-WAN space with its Gluware solution. Gluware is a platform for automating configuration of an enterprise SD-WAN in cases of a multi-vendor network.
Cisco was an early investor in Glue’s SD-WAN and resells Gluware to enterprises that want customization. In cases where equipment is interoperable, Gluware can configure an entire chain, treating the multiple vendors’ products as one workflow.
Glue Networks currently supports Riverbed’s WAN optimization, Palo Alto Networks’ firewalls, and A10’s load balancer.