Venture capitalists are lavishing money on the fashionable Linux supercomputing concept—but smaller firms face much larger rivals.
Reflecting the growing popularity of Linux clusters for high-performance technical computing, two companies have secured new investments in the tens of millions of dollars.
San Francisco-based Penguin Computing raised $10 million, while Linux Networx in Salt Lake City received a $40 million investment. Both companies will use the funds to develop new technology and expand into new markets, they said in announcements Thursday.
Both companies specialize in groups of lower-end Linux servers linked into a high-performance computing cluster. The technology is gaining prominence in industry, academia and government labs, and clusters accounted for nearly half the entries on the most recent list of the world's 500 fastest computers.
Oak Investment Partners led Linux Networx' investment round; new investor Tudor Ventures also participated. Ed Glassmeyer, Oak's founding general partner, will join the company's board.
Also on Thursday, Linux Networx announced a new storage system called Xilo that dovetails with its clusters. Xilo lets disparate storage systems be joined into a single pool, the company said.
In 2003, Linux computer maker Penguin Computing acquired Scyld, a cluster specialist. Penguin's new funding will let it improve the Scyld software, marketing, sales force and professional services, Chief Executive Enrico Pesatori said in an interview.
London Merchant Securities led Penguin Computing's investment round; Convergence Partners and Sunrise Venture Capital also participated. Scott Potter, a managing director of LMS Capital, joined Penguin Computing's board.
The company has about 50 employees, but expects to double that within a year and triple it within two years, Pesatori said. The objective is to adapt the Scyld software so it can be used not just for technical computing clusters, but also for running business software, he said.
"Many of the characteristics of Scyld—single system image, how you can provision or deprovision servers, how easy it is to manage—are also providing the features needed to manage large servers," Pesatori said. Scyld products account for about a third of company revenue, but the CEO hopes it will become two-thirds.
To boost the Scyld technology, Penguin Computing will use some of the funding to pursue business partnerships with software companies in specific sectors of high-performance computing such as fluid dynamics or biotechnology. And the company wants to make the Scyld software available on other companies' computers, he added.
The smaller companies face challenges from better established computer makers such as IBM, Dell, Hewlett-Packard, Sun Microsystems and Cray.