Data Sheet—Wednesday, September 17, 2014

Good morning, Data Sheet readers. Two long-time Microsoft directors are leaving this month, as CEO Satya Nadella gathers new advisors for its turnaround. Plus, will money for tech startups dry up anytime soon? Dealmakers may be more selective but it’s sure hard to tell from the furious flow of new funding or the steady stream of startups emerging from stealth. Today’s example, big data player BlueData. Enjoy your Wednesday!

Fresh thinkers for Microsoft's board. Two directors aren't sticking around after their terms are up this month: finance expert Dina Dublon and VC David Marquardt, who has been there since 1981. Stepping in as of Oct. 1 are Kraft Foods CFO Teri List-Stoll and Visa CEO Charles Scarf. (Incidentally, now seems a good time to mention that Salesforce CEO Marc Benioff is leaving Cisco's board in late November.)

Have VCs reached their tech investment threshold? Not yet. Benchmark partner Bill Gurley worries investors are taking on too much risk from cash-burning startups. Apparently, he's not the only one worried, but no one's ready to close their wallets. Exhibit A: the official launch this week of Battery East—run by dealmakers from Peter Thiel, BlackRock and Howard Schultz's venture fund. One of their first success stories: $75 million for stock trading platform IEX (made famous in the Michael Lewis book, Flash Boys). That's $25 million more than it was seeking.

CLOUD CHATTER

Rackspace: Nope, we're staying independent. After struggling to differentiate against bigger providers like Amazon Web Services, Microsoft and IBM, the company is growing again with its "we'll manage it for you" strategy. So it's off the market (it's been shopping for a buyer since May). Just to make sure you know it's serious, Rackspace finally promoted president Taylor Rhodes to CEO.

Next stop, Ohio? Amazon could get up to $81 million in tax breaks and other municipal perks for putting an Amazon Web Services data center near Dublin. In exchange, it'll invest $1.1 billion in the project over three years. The service provider runs its cloud from four other sites in the United States (10 around the world).

Cisco to buy private cloud specialist. It just announced a deal with Metacloud, which plays into its strategy of creating services to support hybrid infrastructure (which, when you think about it, means every cloud deployment at any sizable company). Terms weren't disclosed.

STATS & SPECS

Elementary, my dear Watson. How's this for timing? IBM is creating a cloud analytics service that includes predictive insights and visualization tools (and a freemium option). Goody! This should make Marc Benioff's upcoming Dreamforce keynote reveal about an anticipated rival offering even more fun! Both would love you to say bye-bye to spreadsheets.

STARTUPS & DISRUPTORS

Zendesk goes big. After rewriting the rules of customer service with fast-growing companies like OpenTable, Twilio and Terracycle, Zendesk is wooing enterprise credibility with a new "elite" option that raises the bar when it comes to dedicated support and service levels. Its new relationship with Avaya, which ties Zendesk features into its contact center technology, won't hurt either.

Stratasys snaps up CAD software upstart. The 3-D prototyping and manufacturing tech company is buying GrabCAD, which develops cloud-based collaboration tools for engineering teams. It didn't disclose the amount, but reports put it near $100 million.

Docker ropes in $40 million. Its "container" technology offers an alternate approach to redistributing and consolidating applications across data centers: early adopters include Baidu, Cambridge Healthcare, eBay, Gilt, Groupon, Spotify and Yandex. Sequoia is Docker's partner in this last found; Docker previously raised $15 million from investors including Benchmark, Greylock Partners, Insight, Trinity and Yahoo! co-founder Jerry Yang.

FAQ

Can you deploy big data in days, not months? That's the value proposition of BlueData, a stealth startup du jour emerging Wednesday to talk up its technology.

Its target (according to CEO and founder Kumar Sreekanti): big pharma companies, manufacturers, media firms and others that want to experiment with advanced analytics without messing too much with existing infrastructure. Its software, called EPIC Enterprise, is installed on-premise rather than in the public cloud, sidestepping some of the security concerns that haunt CIOs seeking to appease would-be data scientists.

The idea is to let businesses test hypothetical use cases before they drop a lot of money on an app or service that doesn't work. The motto: deploy quick, fail fast, assimilate that learning, and move on. "There is a lot of confusion, complexity and uncertainty around big data applications, platforms and deployment models, combined with how to leverage existing infrastructure investments," Sreekanti says. "This has kept a huge swath of the enterprise market on the sidelines."

Who's behind this company? The founders and advisors hail from places like Akamai, Facebook, Intel, NetApp, SGI, ServiceNow, VMware and Yahoo! Its $15 million Series B funding round was led by Ignition Partners (and also included Atlantic Bridge Ventures, Intel Capital, Amplify Partners and Data Collective). Oh, by the way, BlueData's partners include respected Hadoop and big data innovators like Cloudera, Hortonworks, Databricks and Metascale.

It's early days: the technology is being used in a small-scale private beta with about a dozen companies (Sanofi and Orange). Now it's time to build on that. BlueData claims its approach costs 50%-70% than competitive ones. Then again, it hasn't set its licensing price yet, so it's hard to say for sure. While you're thinking about it, you can test things out on a small scale using the community version.

ONE MORE THING ...

Rules for robots? Setting aside driverless cars for a moment, the automotive industry is super-dependent on software and sensors for vehicle operation and safety. And it's far from the only industry: robotics are behind many manufacturing and transportation processes. All this convinced Brookings Institute to weigh in with its case for a "Federal Robotics Commission" that would set policy.

The paper notes: "Robotics increasingly display emergent behavior, meaning behavior that is useful but cannot be anticipated in advance by operators. The value of these systems is that they accomplish a task that we did not realize was important or they accomplish a known goal in a way that we did not realize was possible."

Of course, humans will still take the fall when regulations are ignored.