The company behind IBM's storage cloud is indeed on the way out.
Last month, Nirvanix -- the San Diego, California company that powered IBM's SmartCloud Storage service -- told customers and partners that it was shutting down on September 30, giving them just two weeks to migrate data, and now, it has filed for bankruptcy.
Nirvanix finally broke its silence this week with a post to its website revealing the Chapter 11 bankruptcy filing and giving customers and partners an additional two weeks to remove data from its service. The deadline for data removal is now October 15.
"Nirvanix voluntarily sought Chapter 11 bankruptcy protection in order to pursue all alternatives to maximize value for its creditors while continuing its efforts to provide the best possible transition for customers," the site says.
The initial news of the shutdown came as a surprise. Nirvanix -- founded in 2007 as StreamLoad -- had partnerships with IBM and Dell, was lauded for its technical chops, and was well funded. It raised over $70 million dollars, including a $25 million round of funding led by Khosla Ventures last year. But it did have leadership issues. The company has had five CEOs since 2008, and three in the past year, according to CRN. The broader reality is that running a cloud storage business is expensive.
This week's announcements, first reported by the Wall Street Journal, provide some closure for those waiting to see what would become of the company -- and of SmartCloud Storage. "We have an agreement with IBM, and a team from IBM is ready to help you," the site says. "In addition, we have established a higher speed connection with some companies to increase the rate of data transfer from Nirvanix to their servers."
The Nirvanix site specifically mentions IBM SoftLayer, Amazon S3, Google Storage, and Microsoft Azure as possible replacements.
Khosla Ventures is the largest equity holder, with 15.5 percent of common stock, 73.2 percent of series 1 preferred stock, and 72.9 percent of junior preferred stock. CEO Debra Chrapaty, formerly the CIO of Zynga, is still listed as CEO on the bankruptcy forms.
According to the bankruptcy paperwork, Nirvanix's largest creditor is Dell Marketing L.P., a subsidiary of Dell formerly known as storage outfit EqualLogic, which it acquired in 2008. Others include IT infrastructure monitoring software company Nimsoft (now owned by CA), Salesforce.com, and IT industry analysis firm Gartner.
