Scale Computing Snags $34.8M to Advance “Alternative” IT Platform

Scale Computing, an Indianapolis IT startup serving smaller businesses, distributed enterprises, and retailers around the world, has raised $34.8 million in a Series F funding round.

Co-founder and CEO Jeff Ready says technology hardware giant Lenovo was the largest contributor to the round, which included participation from Allos Ventures and unspecified “existing investors.” Since the company was founded 11 years ago, it has raised a total of roughly $104 million.

Ready says Scale provides “a fully integrated alternative way of doing IT.” The company’s patented technology uses automation and artificial intelligence to find and fix infrastructure problems in both hardware and software, he continues.

“Typically in IT, you have servers, storage, networking, et cetera in a mish mash to run the backend,” Ready explains. “The challenge is when you don’t have a lot of IT resources—personnel and maybe even money. That conflict between limited IT resources and increasingly complex IT infrastructure is the problem we’re trying to solve.”

Ready says Scale addresses those challenges by uniting disparate systems and software, usually made by a host of different vendors. A company might have an array of interoperating pieces in its stack, so when things go wrong, it can be problematic to get to the bottom of it, he adds.

“You have to figure out what went wrong and how you unwind it while knowing all the pieces touch each other,” Ready says. “It’s like a Jenga tower—how do you keep all of that running? We consolidate things and eliminate the need for other vendors.”

In a video e-mailed to Xconomy by the Detroit Symphony Orchestra, a recent Scale customer, the organization’s head of technology and infrastructure, Jody Harper, referred to Scale’s platform as “the nonprofit IT person’s dream.” Harper said switching vendors to Scale made his job easier and saved the orchestra money.

Earlier this month, Scale announced a partnership and new joint product with Lenovo, which splits its headquarters between Beijing, China, and Morrisville, NC. Ready says Scale’s HC3 Edge Platform on Lenovo servers is designed for medium-sized enterprise operations and replaces complex on-premise infrastructure with a “self-healing” system.

Ready says Scale has 3,000 customers worldwide, including Ahold Delhaize, a Dutch supermarket chain with 7,000 stores, and about 110 employees at offices in Indy and San Francisco. He says Scale plans to use its new capital to add more than 100 employees over the next year and a half, many in global support positions.

“We grow into our shoes, and then we buy bigger shoes,” Ready says of Scale’s fundraising and growth strategy. “It’s taken longer to grow because we’re not a household name. We don’t raise enough money to run Super Bowl ads, so we get most of our customers through the testimonials of other customers.”

Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or sschmid@xconomy.com. Follow @XconomyDET_AA

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